New Jersey bond plans spark controversy

New Jersey is planning more than $200 million in borrowing for new government office buildings amid opposition from many in the state's capital city.

The New Jersey Economic Development Authority voted on Dec. 12 to authorize $228 million in bonds for two new buildings that will house the state’s departments of taxation, agriculture and health. The state legislature’s Joint State Leasing and Space Utilization Committee on Monday approved relocating the departments into two new facilities to be built on state-owned land in downtown Trenton, a move some community activists worry will undercut plans to redevelop the city.

Emile Wamsteker/Bloomberg

Ten opponents of the project, including Assemblyman Reed Gusciora, D-Trenton, and City Council President Zachary Chester, filed suit in Superior Court Monday claiming the bonding is “illegal” since it was rubber stamped without voter approval. A newly formed group called Stakeholders Allied for the Core of Trenton has also launched a GoFundMe page that as of 3 p.m. Tuesday had raised $9,527.

“Single-use office buildings will only perpetuate Trenton's 'nine-to-five' culture,” Gusciora said in a statement adding that any decision on the office buildings should be left for Governor-Elect Phil Murphy instead outgoing Gov. Chris Christie. "It's really disappointing that the Governor, who has ignored the Capital City for his entire tenure, will be able to exercise his will and reshape the City for the foreseeable future.”

Gov. Christie's press office didn't respond to a request for comment on the lawsuit. The Republican governor’s eight-year run ends on Jan. 16, when Murphy will be sworn in.

The latest lawsuit follows similar legal action spearheaded by a bipartisan group of state lawmakers that unsuccessfully tried to block $300 million of debt issued by the Christie administration to renovate sections of the State House. The NJEDA bonds were issued on May 11 by lead underwriter RBC Capital Markets in a private placement deal.

New Jersey Department of Treasury spokesman Will Rijksen said the $228 million bond sale for the two buildings is slated for early 2018. The borrowing will occur as part of a $380 million debt issuance that would also include funds for new Juvenile Justice Commission buildings in Ewing, Winslow and Woodbridge. The tax-exempt bonds will mature in 30 years and be backed by lease payments through the agencies, according to an NJEDA memo.

Christie will exit next month with New Jersey having the second lowest bond rating of the 50 U.S. states due mainly to rising unfunded pension liabilities. The Garden State, hit with 11 credit downgrades over Christie’s two terms, has ratings of A3 from Moody’s Investors Service, A-minus from S&P Global Ratings and A from both Fitch Ratings and Kroll Bond Rating Agency.