On Tuesday, March 26, an initial decision was reached by a trial court judge to deny a motion by the City of Hoboken, and the developer of a downtown hotel, KMS, to dismiss a lawsuit against the two entities pertaining to the hotel redevelopment deal, according to a press release from the city.
The litigation against the city and KMS was originally filed by “Hoboken Land Building, L.P.” and “Hoboken Holdings, L.P.”
The two Hoboken businesses, both within a block of the approved hotel which will be built on the parking lot of the post office on Sinatra Drive, filed the suit on Nov. 15 in Hudson County Superior Court seeking to have the resolutions pertaining to the redevelopment agreement declared null and void.
The suit stems from the givebacks the city will receive as a result of approving the hotel plan, including $2 million to renovate the Hoboken Community Center at the former YMCA property, $1 million to improve infrastructure along First Street, $165,000 for infrastructure in adjacent neighborhoods, a $1 million endowment to the Hoboken Public Education Foundation, $484,000 to the Hoboken Public Charter Schools, and $200,000 for Hoboken’s Affordable Housing Trust.
According to multiple media reports, the businesses believe the givebacks are an obvious quid pro quo and promote favoritism and cronyism. They also say the city is without the legal authority to require that a redeveloper make a payment to the Hoboken Public Education Foundation, because it is a non-government entity.
According to a press release from the city, the city “will aggressively pursue the next steps to defend its position on the merits and believes it will ultimately prevail in court.”
“The hotel deal furthers the redevelopment of the city, provides the community with unprecedented benefits and continues to be a priority for my administration,” said Mayor Ravi Bhalla in the press release. “We are confident that the city will ultimately prevail, our city will be revitalized, and our community will realize all [the] benefits agreed to in this deal.”