PART ONE: Did Mayor Jackson Rip Off a Church?

As this blog has delved deeper into Mayor Jackson’s business dealings, there have been some interesting stories that make me wonder about the Mayor’s leadership and track record, which will be recounted here. Mayor Jackson has quite a few businesses in Montclair and the surrounding communities. One business in particular, Lorterdan, is a diversified real estate development company. Lorterdan Properties has numerous businesses throughout New Jersey.

In 2002, Lorterdan Properties at Ramapo, LLC purchased close to 250 acres near the New Jersey/New York border. The property was originally acquired by CHFM Associates and was sold to Jackson.

The land was a HUGE discount for Jackson. Jackson bought the land for $2,075,000 in 2002 and later sold the land (keep reading below for the details) for $11,500,000 in 2009. If the land was adjusted for inflation, the land should only have been worth $2,474,509.59 in 2009. Instead, Jackson saw a 454% increase. That’s a pretty significant increase. After looking through records, it appears like Jackson didn’t make any improvements to the land.

So why did Jackson receive such a discount on the land he purchased in 2002? Well, CHFM Associates is a New Jersey Partnership, founded by its partners Foun-Chung Fan, Wen-Hong Chen, Maurice Hsu, and Hsiu-Ju Mao. According to New Jersey’s business entity records, Foun-Chung Fan is also a principal at Lorterdan Properties at Ramapo, LLC. Probably as a result of this partnership, Jackson received the property at a heavily discounted rate.

Once Jackson got the property in his hands, he intended to build four developments, totaling over 1,800 housing units. Jackson even received zoning for the property, but something seemingly went amiss and Jackson put the property up for sale. Some speculate the economic downturn was a contributing factor for Jackson’s decision to sell the property.

What follows next is taken from a lawsuit, Lorterdan vs. Watchtower. Documents from it are linked to at the bottom of this blog for your reading pleasure.

The property was eventually sold by Jackson to Watchtower Bible and Tract Society of New York  (a Jehovah’s Witnesses group) for $11.5 million in 2009. If Watchtower decided to develop the land, they would then pay an additional $9.5 million in “consulting fees.” A repurchase agreement on the land was also included in the contract—at any time, Watchtower could back out of the contract within a two-year period, and Lorterdan was contractually obligated to repurchase the property for the same price as it was sold for.

Over the course of a year, Watchtower had numerous setbacks when they tried to get zoning for the property in order to develop it, and were ultimately unsuccessful. Additionally, they had difficulties earning a tax-exempt status. When it was clear that Watchtower could not get the property developed within the agreed upon timeline of two years, they sent a letter to the mayor dated November 1, 2010 and asked his company to repurchase the land.

Mayor Jackson personally met with Watchtower, acknowledged his contractual obligation, and promised to begin financing the repurchase of the property. Mayor Jackson’s company, apparently planning for what to do with the property after the repurchase, petitioned the Town Board on March 1, 2011. Lorterdan’s original 2005 development plan was zoned for a 55+ Senior Development, but in 2011, he wanted the age restrictions removed due to the "proposed target market of those homes" had "drastically declined, largely because of the current deteriorated national economic conditions."

Watchtower was more than willing to work with the mayor (developer) and consented to Lorterdan’s rezoning efforts, providing Lorterdan with an Owner's Consent Affidavit dated March 14, 2011. The Owner’s Consent Affidavit stated that the Lorterdan had a contractual right in the property and there was an obligation to repurchase it from them.

However, during that period of time in March 2011, it seems Mayor Jackson’s rezoning plans did not pan out. According to the Opinion and Order, on March 28, 2011, Lorterdan’s attorneys sent Watchtower a notice that it was rejecting the repurchase agreement, despite Mayor Jackson’s previous statements and assurances. In addition to backing out of the property repurchase plan, Lorterdan demanded that Watchtower pay $9.5 million for consulting fees that would have been owed had Watchtower decided to develop the property (perhaps the mayor somehow forgot the letter they received from Watchtower several months earlier?). Mayor Jackson’s company then initiated a very, very messy lawsuit. Ultimately, the case was settled confidentially.

This begs the question: why did Mayor Jackson agree to repurchase the property from the Watchtower group, only to reject the repurchase agreement and file a lawsuit against the religious group? This blog has a couple of different theories.

1.     It’s quite possible that Lorterdan's rezoning plan submitted on March 1, 2011 was turned down, or that they weren’t able to secure financing for the project.  But even in that case, they were still obligated to buy the property back from Watchtower, and suing instead of doing that raises questions about principles and ethical business behavior.  

2.     Another possibility is that Jackson just didn’t have the $11.5 million on hand to return to Watchtower and was looking for a way out of the contract. But in that case, that’s just irresponsible.

The case raises a number of interesting and important questions that will be explored in future posts. Stay tuned…

For more information on the case, click here. 

Mayor Jackson Stepping Down From The Planning Board After This Blog Revealed Potential Pay to Play Issues

The past few blog posts here have been about Mayor Jackson potentially violating Montclair’s ethics ordinance by receiving contributions from developers while possibly negotiating development deals with them. As of Monday, when this blog first shed light on some of the shady business deals happening in our town, Mayor Jackson served on the Planning Board.

Well now it appears that Jackson will be stepping down from the Planning Board. Says the Montclair Times:

“The commission's former representative, Martin Schwartz, will remain on the Planning Board as Jackson's appointee, essentially replacing Jackson.”

Coming just a couple of days after this blog’s first post on mayor’s possible backroom deals, the timing of this decision doesn’t seem coincidental. Maybe the mayor/developer thought he could avoid a potential future conflict? Or future scrutiny?

Also, this blog would also love to know if there’s any real beef between Jackson and Schwartz over the MC Hotel and Centroverde development project. Back in January, Schwartz said they were pushing back on the “ugliness” of the projects:

“Many residents worry that the developments will add large, bulky buildings to the streetscape, detracting from the historic quality that differentiates Montclair from some of its less picturesque neighbors. The designs, they argue, could be found anywhere along the state’s strip-mall-strewn roads.

The developments are “going to look absolutely hideous,” said Jason DeSalvo, a Montclair resident. “They’re basically sheer walls. It’s like a concrete canyon,” he said.

“We are pushing back on the ugliness,” said Martin Schwartz, a member of the Montclair planning board and a critic of the developments. “We are saying we want redevelopment — we just don’t want it to look like Route 46 New Jersey.” ”

And when Schwartz questioned Planning Director Janice Talley on whether she was “really in favor of opening the floodgates for unbridled development here,” his comments struck a nerve with Jackson. Jackson characterized his comments as “facts-challenged, bad form, and perhaps [having] a touch of demagoguery.” Those are some fighting words!

“Clearly, there is a feeling by many residents that our planner does not really support a preservation-directed, neighborhood character approach to redevelopment,” says Schwartz.  “Based on the excessive heights and bulk parameters originally proposed in the first master plan draft which put people up in arms, and the mass and density she didn’t stop for the first CentroVerde project [Valley and Bloom] while the redevelopment terms required the project to blend in with our downtown, it appears Ms. Talley is really in favor of opening the floodgates for unbridled development here.”  Many Montclair residents themselves have directly demanded more municipal preservation and protections of historic structures, both publicly at meetings and in research Talley herself conducted through public feedback for the master plan.  Talley, though, defends her stewardship of redevelopment projects in Montclair.

“My role is to facilitate the development of plans through coordination of consultants, subcommittees, the Planning Board and the public, ” Talley tells Baristanet.  “I am not a decision maker, but a facilitator in this process, and the plans that have been prepared over the past four years are the result of many different voices.  Recent redevelopment plans have included extensive design standards which were not a part of previous redevelopment plans.  The purpose of these design standards is to help ensure that new development fits in with the context of existing neighborhoods.”

Mayor Jackson was more direct in response to Schwartz’s observations.

“I consider Mr. Schwartz a friend and I respect his opinion on matters of planning and development,” the mayor said.  In this instance, however, I have to characterize his comments as facts-challenged, bad form, and perhaps [having] a touch of demagoguery.”

It’s great to see that Schwartz is replacing Jackson. This blog isn’t the only one to support the preservation of Montclair’s historical assets. A little while back Saving Montclair made an appeal to keep Schwartz on the Planning Board. This blog is glad he kept him, but curious about the whole turn of events.

It seems Jackson was weary of the increased public scrutiny as he stepped down from the Planning Board just 2 days after this blog’s revelations. This blog will continue to monitor the situation and provide updates on the matter as necessary. And this blog will continue to investigate issues like these. In fact, this research has led to further findings that will be detailed here over the next week. Stay tuned…

Who I Am

This blog has also gotten a few inquiries and heard some murmurings on social media that speculated about whether I was tied to the blog Montclair Schools Watch. While I’ll cop to being a bit of a copycat after watching their blog, I don’t know them or have any ties to them, or even agree with them on most things. My own beliefs around what we should do with our schools seem to be pretty different than theirs (significantly so, from what I can tell), and I disagree with them and the people they support.

My own interests are more focused on town governance, good governance, development, and media accountability. These are areas where I feel like there hasn’t been nearly enough scrutiny on the system, and where the media attention has been weak. That’s what I intend to blog about. That said, if you have any good tips on problems or corruption present in the schools, or anywhere else, please don’t hesitate to send them my way: montclairsdirtylaundry@gmail.com

Did Mayor Jackson’s Actions Violate The Spirit Of Montclair’s Pay-To-Play Ordinance?, Part 2

This blog was irked to discover that ARC Properties’ Robert Ambrosi and Marc Perel’s properties were included in the Redevelopment Study and voted on by both the Planning Board and Township Council. Did this blog mention that both Perel and Ambrosi had their sons contribute to Mayor Jackson in 2012? Yeah, that definitely happened.

As was previously mentioned, on 3/14/12, Mayor Jackson received a $2,500 contribution from Michael R. Ambrosi (Michael Ambrosi is Vice President of Leasing and Marketing at ARC Properties, a local developer group. Ambrosi’s father, Robert, is the Chairman and CEO of ARC Properties):

This blog laid out Montclair’s ordinance in the previous post, but just to recap, the ordinance establishes “that a business entity which makes political contributions to municipal candidates and municipal and county political parties in excess of certain thresholds shall be limited in its ability to receive public contracts from the township of Montclair in the county of Essex.” The ordinance states that no business entity, which includes an individual, the individual’s spouse, and any child/children, can be awarded a contract if they had made a contribution to a candidate (Jackson) within a twelve-month period. 

Based on Montclair’s ordinance, even negotiating future development projects would be strictly prohibited. In other words, if Ambrosi had discussed/struck a deal/negotiated redevelopment plans with the mayor from March/April 2012 (when his son first contributed to Jackson’s campaign) to March/April 2013, he would likely be in violation of the ordinance.

Around the time Mayor Jackson received a contribution from Ambrosi’s son, Jackson became the “driving force” and was the “architect of the idea” behind a plan to move the police headquarters to a privately owned building. According to a Montclair Times article from 2012:

“Montclair's aging police headquarters and municipal offices may soon be relocated together into a new building, part of an ambitious project that could also include offices and restaurants on the parking lot across the street from the Lackawanna Plaza shopping center, a project that would increase the tax stream and decrease the township's debt, municipal officials said.

The idea is in its early stages and is being explored at this point, according to officials, who said it would include leasing the land on which the police station is located - at the corner of Valley Road and Bloomfield Avenue - and/or leasing the land on which the Municipal Building sits, at 205 Claremont Ave.

Mayor Robert Jackson, the architect of the idea, envisions the fiscal value of the police and municipal property not only paying for the new project, but also adding additional income of $2 million to $3 million a year to the town's coffers as either taxes or as a PILOT (payment in lieu of taxes) fee - income that could help control taxes and reduce Montclair's tremendous debt.”

An interesting tidbit, Robert Ambrosi owned the property Jackson was interested in. In fact, Jackson told the Montclair Times that he discussed the plan for the property with Ambrosi. Jackson was unsure if Ambrosi’s property would be bought or leased, but did hint at current and future negotiations:

“The owner of the property, Robert Ambrosi, founder of ARC Properties, Inc. of Clifton, did not return calls for comment.

Jackson, however, said that he's spoken to Ambrosi about the project and "he likes the idea very much. He was very favorable."

Jackson does not know whether the land would be bought or leased from Ambrosi.

"It can take a number of forms," he said. "When you negotiate, you say, 'Here's what we have, here's what you have, this is what we want, how can we make this happen?'"

So Mayor Jackson already discussed the property with Ambrosi in 2012 (the Montclair Times article was from 12/24/12), a few months after Ambrosi’s son (who works for the company) had contributed to the Mayor’s campaign. In 2013, the Montclair Times article reported that Ambrosi was unsure if he would sell or lease the land to whoever develops the project.

“I think it's a good idea," said Robert Ambrosi, a Montclair resident and founder of Clifton-based ARC Properties, Inc. "The locations where the Police Department and Municipal Building are now are underutilized.

"We are very open and receptive to it," said Ambrosi.

At this stage, Ambrosi doesn't know whether he will sell or lease the land to whoever develops the project. "There are so many details," he said, "it's impossible to say."

As a Montclair resident, Ambrosi sees the projects as "good for the taxpayer.”

All the big developers in town were probably already on the mayor’s Christmas card list before he got elected, but that doesn’t excuse under the table and behind the scenes dealing like this one. There’s a lot of details around this but one fact is clear: Our dear Mayor and sometime-developer Robert Jackson was discussing and negotiating plans for the property with Ambrosi in the months shortly after he received a big check from Ambrosi’s son, who works for the family company. And as best as this blog can tell, that would violate the Montclair ethics ordinance.

Did Mayor Jackson’s Actions Violate The Spirit Of Montclair’s Pay-To-Play Ordinance?

This blog started looking into the deals and relationships driving our town’s development, and already there are some fairly questionable issues.

On 3/14/12, Mayor Jackson received a $2,500 contribution from Michael R. Ambrosi:

On 4/11/12, Jackson received a $2,500 contribution from a Gregory M. Perel:

Who are Michael Ambrosi and Greg Perel, and why are those contributions important? Michael Ambrosi is Vice President of Leasing and Marketing at ARC Properties, a local developer group. Ambrosi’s father, Robert, is the Chairman and CEO of ARC Properties. Gregory Perel, who lives in New York but contributed to a local Montclair campaign, doesn’t work for ARC Properties. But his father – Marc Perel – does. He’s the President and COO.

While searching through business entity records, this blog discovered that both Robert Ambrosi and Marc Perel are principals at an entity called Montclair Commerce, LLC:

Interestingly enough, Montclair Commerce, LLC owns the deed to 233 Bloomfield Avenue, which was recommended as a redevelopment area in the October 2014 Montclair Center Redevelopment Study. The Township Council authorized the Planning Board to undertake the preliminary investigation on March 4, 2014 and June 18, 2014 – votes that helped advance the developers efforts.

A New Jersey statute, NJ Rev Stat § 40A:12A-4 (2014), grants the municipal governing body the authority to conduct a preliminary investigation, make recommendations, and implement redevelopment plans. According to a local law firm specializing in the area of redevelopment and planning, “Bluntly, a redevelopment agreement is a zoning contract.”

Jackson and Councilor McMahon abstained from voting while on the Planning Board, as they would be voting on the matter at the Council level. On 3/10/15, the Township Council passed a resolution, based on the findings of the Planning Board and their public hearing, and designated 233 Bloomfield Ave. as an area in need of redevelopment. The plan was the first resolution on the Consent Agenda: the “Council of the Township of Montclair does hereby declare the parcels of land known and described above on the Tax Maps of the Township of Montclair to be an area in need of redevelopment,” which included 233 Bloomfield Ave. Jackson voted for the redevelopment plan (tune into the Council Meeting at the 71:44 minute marker on 3/10/15 to hear Jackson’s vote).

Under redevelopment plans, developers like Ambrosi and Perel get tax abatements in exchange for “the developer’s promise to build in distressed or blighted areas.” According to the Montclair Times:

“Montclair's elected officials say tax abatements have become a useful tool in their quest to attract development and increase tax revenues for the township.

The PILOT, or Payment In Lieu Of Taxes, agreements permitted under state statutes allow municipalities to offer developers a reduced tax burden in exchange for the developer's promise to build in distressed or blighted areas.”

Some community members have already expressed concerns over the PILOT program, saying developers were getting too many benefits on the taxpayers’ dime:

“Scott said that there is going to be development in Montclair one way or another, but it was up to residents to  keep up with development proposals as they relate to the density and scale involved and oppose any elements of the master plan and redevelopment plan they feel would alter the town’s character. He added that Planning Director Janice Talley had an obligation to keep updated the various redevelopment plans on the township’s website. Many residents were disgruntled over the Payment In Lieu Of Taxes (PILOT) program, which they felt gave too many benefits to developers on the backs of the taxpayers. Resident Jarvis Hawley expressed interest in getting a petition signed by residents to prevent future PILOT deals.”

So Ambrosi and Perel were awarded a contract with the city and quite possibly earned tax credits in exchange for promising to redevelop the property.

But Montclair has an ordinance establishing “that a business entity which makes political contributions to municipal candidates and municipal and county political parties in excess of certain thresholds shall be limited in its ability to receive public contracts from the township of Montclair in the county of Essex.” The ordinance states that no business entity, which includes an individual, the individual’s spouse, and any child/children, can be awarded a contract if they had made a contribution to a candidate (Jackson) within a twelve-month period. 

Based on Montclair’s ordinance, even discussing future development projects would be strictly prohibited. In other words, if Perel and Ambrosi had discussed these redevelopment plans with the mayor from March/April 2012 (when their sons first contributed) to March/April 2013, they would be in violation of the ordinance. The New Jersey Local Government Ethics Law would also likely be relevant here – and is particularly concerned with public actions that create even the appearance of a conflict.

This Montclair ordinance was designed to protect “taxpayers and residents as to their trust in government and its business practices” from deals like this. Even if there was not a discussion and a specific violation of the ordinance, it seems to this blog that the Mayor's actions certainly violated the spirit of the ordinance, which was intended to prevent even the appearance of public corruption and to promote trust in government. Mayor Jackson should have rejected the contributions from Perel and Ambrosi, or avoided any involvement in city projects associated with them. He certainly shouldn’t have voted to advance their project himself. 

As a final note, the fact that both campaign contributions came from these developers’ sons (instead of from themselves) seems particularly odd and plenty shady to this blog…

Questioning the Legitimacy of Business Deals In Town

The talk of the town is the Redevelopment Project that has been ongoing. While some are supportive of the project, others have their doubts, saying the project would increase taxes, displace residents, and cause more congestion in that area.

This blog intends to look into the business deals happening in our town. Are the business transactions legitimate? One way to figure out if any favoritism in our town has existed is looking at publicly available campaign finance disclosures in order to have a clear understanding of how money influences politics. Should we be concerned with any pay-to-play activity? This transparency is only valuable when the public actually looks at the contributions and determines for itself whether there is any "pay-to-play" dealings or outside influences at work here.

It’s like a puzzle, putting all of these pieces together. This blog hopes to uncover some of these questions over the next few days. Stay tuned.