On Feb. 14, the City Council will vote on a 30-year tax abatement that will allow the construction of a new 20-unit veterans’ housing project on Ocean Avenue. Critics question the project’s intent, however, since only three of the 20 units will be dedicated to housing homeless veterans, while the other 17 units could be rented at market rate if not enough veterans apply.
The project is being developed by Terzetto NJ LLC, a woman-owned, Jersey City small business. It was approved by the city’s Planning Board in 2017.
The mixed-use, mixed-income building on Ocean Avenue near Bidwell Avenue will include three units for homeless veterans, six low-income units, and 11 market rate units. All of these units will be priority marketed to veterans.
But under questioning from several council members at a council caucus earlier this month, including Councilman Michael Yun, the developers admitted the remaining 17 residential units could go to non-veterans if not enough veterans apply.
A representative from the developer at the council’s Jan. 22 caucus meeting said the company cannot hold units vacant waiting for qualified veterans to apply. If a veteran applies, he or she will be given preference. Otherwise, the unit will be rented to the general public.
In support of the project, Mayor Steven Fulop promoted this project as another effort to provide housing for homeless and other veterans.
“As a veteran myself, I am proud that Jersey City was the first city in the state to take the pledge to end veterans homelessness, and with each project, such as this one, we are one step closer to achieving this important goal,” Fulop said. “Our commitment to providing housing and resources to those who have served our country is one way Jersey City is saying ‘thank you’ to these men and women for all they have done. This project represents a crucial and exciting step forward.”
The developer, Terzetto, will work with Community Hope to provide supportive services to the homeless veterans, and the Curtis Consulting Group LLC, which provides vocational training geared specifically toward veterans.
Dubious about JCRA’s role
But Jayson Burg, a persistent critic of the Fulop Administration, said he was concerned about the close relationship between Terzetto and the Jersey City Redevelopment Authority, which has spearheaded the project.
“This was once an adopt-a-lot property,” Burg said, referring to a city instituted project to help clean up and maintain vacant properties throughout the city.
“The building will cost $3.7 million to build,” he said. “Terzetto NJ Urban LLC is getting 75 percent from Jersey City and Hudson County. Each apartment unit of the 20 units costs $185,000, which does not include the retail space.”
Burg said the developer should not receive a 30-year tax abatement for the project, considering all the benefits it has already received from the city and county. Burg pointed out that the city sought requests for proposals on the property in late 2015, but the project is only just getting approvals to move ahead.
Burg and others have often questioned the city’s ability to use the Jersey City Redevelopment Agency to negotiate projects such as this, believing the city has the ability to steer projects to favored developers.
“Politics in New Jersey,” a comprehensive but somewhat dated book published by The Eagleton Institute of Rutgers University, noted that requests for proposals can often be drafted so that the specification may only fit one bidder, or that a bidder might massively underbid a project to eliminate competition. Later, the contract can be amended to include other aspects that allow a contractor to make up the difference. In some cases, projects are overspent through a series of change orders.
Critics have pointed to other projects the city has undertaken which have taken too long and cost more than originally proposed, raising questions as to whether these were underbid in the first place.
Under Title 40 of state statutes (known as Home Rule), municipalities control nearly all aspects of development through agencies such as the planning and zoning boards. Redevelopment authorities have even more power to advance projects, often doing away with some of the state-imposed restrictions projects would normally have to face.
Yvonne Balcer, another critic of the Fulop Administration, opposes 30 year abatements as unfair to homeowners who have to pay the school and county taxes that are not paid by properties with abatements.
This project, according to Fulop, seeks to accomplish two important priorities: creating housing for veterans, particularly homeless veterans, and to develop a stock of affordable housing to counter the huge amount of market rate projects that are causing people to move out of a number of areas of the city.
The demolition of housing projects such as the Montgomery Gardens two years ago for mixed use development has contributed to a shortage of affordable housing. Even artists, who once proliferated in downtown Jersey City, have been forced out by rising rents. Many have settled into Jersey City Heights. But even those rents are on the rise. One study of the 50 largest cities showed Jersey City with the highest average rent for a one-bedroom unit.
To counter the trend, the city has implemented a requirement that all abated projects set aside 20 percent of its units as affordable, even along the waterfront. But critics like Burg and Balcer believe this is too little and too late.
Al Sullivan may be reached at email@example.com.