In a letter dated Jan. 11, the State Attorney General notified EnCap and the Trump Organization that they could continue environmental clean-up work at a 785-acre site that spans Rutherford and Lyndhurst and was once home to four garbage dumps.
The site is currently slated to include a golf course and possibly housing and office buildings.
The letter was dated the same day EnCap had been required to demonstrate that it was making "measurable progress" in land remediation at the site or risk being removed from the project.
The letter was also dated just days after EnCap failed to submit a budget that was due on Jan. 3.
Early supporters of the project, Secaucus Mayor Dennis Elwell among them, hope the extension will enable EnCap, now working in partnership with Donald Trump, enough time to get the beleaguered project back on track. Those who oppose the project wonder if the extension will give new life to a bad idea.
State taxpayers stand to lose $50 million if EnCap fails to meet its obligations, while Secaucus residents could either gain or lose an opportunity to mitigate their own tax burden.
In 1999, the New Jersey Meadowlands Commission (NJMC), which regulates zoning and development in several towns in the Meadowlands area, selected the North Carolina-based EnCap to develop a 785-acre site that had once been a long rambling series of garbage dumps. Under the agreement, EnCap was supposed to remediate the land and develop hotels, office buildings, and other commercial real estate projects.
"At first, I think in general, everyone thought it was a great idea," said Mayor Elwell.
The project was perceived to be a win-win all the way around: The garbage dumps would be closed permanently. Contaminated land that was saturated with leachate, a toxic stew that ran-off into the Hackensack River, would be cleaned. Desolate space would be put to good use. And the area would benefit from an expanded tax base as new businesses moved into the planned offices spaces that were going to be built.
Although Elwell was not involved in any of the planning discussions since the development site spreads across Lyndhurst, Rutherford, and North Arlington, he said, "It was my impression that the development projects were going to financially benefit all of the communities in the Meadowlands district."
So the mayor supported the project, sensing a possible opportunity.
"Secaucus is a community that pays $3.5 million into a revenue-sharing pool every year," he continued, referring to the taxpayer dollars that the township forks over to the NJMC. "Our hope for the EnCap project was that it would create new ratables" - tax dollars from commercial properties - "and would eventually offer some economic relief to the people of Secaucus."
The $3.5 million which the town pays to the NJMC is almost 10 percent of the Secaucus' annual budget.
"That's a tremendous amount of money," the mayor said. "It's huge."
Elwell wasn't the only official to get behind EnCap. The developer won the support of state agencies and other municipal leaders who were excited by EnCap's commitment to transform toxic landfills into usable space that could generate tax dollars.
Although Elwell says preliminary plans called for commercial development, the final plan included 2,600 units of residential housing for Lyndhurst and Rutherford, 1,600 units of housing in North Arlington, and two golf courses.
EnCap loses steam
But by last year, EnCap seemed to have lost momentum. The project was running over budget and behind schedule. Some environmental groups were unhappy with how the cleanup was being done. And EnCap missed a few project-related deadlines. Finally, in September, the NJMC threatened to remove EnCap from the project.
Both the developer and the project lost political support, too, when some pro-EnCap leaders were voted out of office and were replaced with anti-EnCap politicians. North Arlington Mayor Peter Massa, for example, made his opposition to EnCap part of his campaign platform.
While Elwell has remained generally supportive of the environmental clean-up at the location and the concept of development there, the inclusion of residential housing put a dent in his hope that the project would be weighted more heavily toward commercial development and create ratables that would benefit Secaucus. (Some people believe that ratables are most profitable when residential housing is either excluded or kept to a minimum.)
The Donald to the rescue?
Last November, New York developer Donald Trump announced that he was entering into a 50-50 partnership with EnCap to complete the project.
Since entering the picture, however, Trump has revealed few plans for the site, other than to say it will include one golf course, not two, and that he will announce a new development plan by mid-March. Until he announces his plans, it is unclear whether Trump will build hotels, office buildings, retail space, housing, or some combination of these elements.
Michael Cohen, an attorney at the Trump Organization who is now serving as executive and manager for the project, did not return several phone calls seeking comment.
"We haven't had any contact with Donald Trump or the Trump Organization," said NJMC spokesman Brian Aberback, who added that that Trump has not reached out to the NJMC. "Our contract is with EnCap, and that is who we continue to deal with."
Environmental clean-up moves forward
If there is any sign that the project may be back on course perhaps it is the environmental clean-up that has kicked into high gear since November. Last week, the DEP gave EnCap and the Trump Organization a vote of confidence when Commissioner Lisa Jackson announced that, even though EnCap missed its Jan. 11 filing deadline, a substantial amount of environmental clean up work has been done at the site.
A spokeswoman for Jackson said she made her determination based on weekly DEP assessments that are made on-site.
Her assessment that the remediation work is moving forward was likely the deciding factor in the Attorney General's decision to grant the four-month extension.
Hackensack Riverkeeper Bill Sheehan said, "My opinion, from the outside looking in, is that ever since the Trump Organization got involved, they've been able to correct or remediate all of the environmental problems that were attributed to the EnCap people. The project had been kind of languishing out there. But in the past eight weeks, they've done some really remarkable stuff out there."
Shehan, who believes the four-month extension granted by the State Attorney General is justified, said the clean-up work that's being done is obvious - even from the Turnpike. Areas that had been bare soil have been hydroseeded, which he said, "holds the soil in place so that it doesn't run off into the river and get into the ecosysytem."
He said work crews at the site have also been pumping leachate out of the ground and treating it at a sewage treatment facility in Newark, and they have recovered methane which is being put into the electricity grid using methane gases.
"All of the environmental concerns are being addressed," said Sheehan, who has previously taken some heat for supporting EnCap's remediation work. "As far as EnCap's financial dealings and the less-than-perfect process that went forward, that's not my focus. My focus is getting these garbage dumps cleaned and capped so that they're no longer polluting the river. As long as they are moving forward with the environmental agenda then I have no problem with these people."
Waiting for tax relief
Until Trump comes forward with his vision of how this former landfill will be revitalized, "we're at a standstill," said Mayor Elwell. "I do not know what's going to happen. Speaking personally, I think all of us would be better off if the project could move forward. The concept itself has tremendous merit."
Every year municipal expenses go up, the mayor said, while revenue remains more or less constant. There are few popular options to deal with this dilemma.
"You either raise taxes, or you cut services, or you have to create an influx of new ratables to offset your costs," Elwell said. "There's no magic to it."