A state authority's plans to demolish several blocks of property near Revel casino in order to build chic boutiques, restaurants and housing is taking longer than expected because of financing issues tied to the $2.4 billion casino’s earnings.
The Casino Reinvestment Development Authority first publicly announced plans in May to acquire portions of five city blocks in Atlantic City's South Inlet neighborhood with the intention redeveloping the area to tie into plans for a park around Absecon Lighthouse.
Dozens of residents, primarily in the Vermont and Metropolitan plaza low rises would be displaced by the plans.
Meanwhile, announcements soon followed that the New Jersey Economic Development Authority would help the CRDA secure $50 million in loans for the project. CRDA would rely on funding derived from agreements with Revel to pay back the loans.
But those loans haven't been secured and now may need to be broken down into smaller increments to make them feasible, CRDA Executive Director John Palmieri said. Rather than $25 million increments, smaller loans may have to be considered.
"Revel hasn't hit the mark they'd hoped to establish. That, of course, affects what lenders and financial institutions are able to lend us," Palmieri said. "Their initial assumptions we had built into our game plan are different from what we had established five months ago, and so this will take some time. But if I thought this project was not going to happen, I would tell you."
The redevelopment area is bordered by Connecticut, Rhode Island, Oriental and Pacific avenues with a few additional parcels on Oriental Avenue extending north to Vermont Avenue. In June, CRDA devoted $1.2 million to initial land acquisition, including property appraisals and environmental remediation, which is not yet complete.
Some residents, already upset about moving out of their homes, are now irate at what they've called a lack of communication about the plans and delays.
Sandra Taliaferro attended a CRDA meeting last month demanding officials tell her whether or not she'd be able to spend the holidays at home. Taliaferro had packed up her belongings and began renting a storage unit in anticipation of moving.
During three informational meetings in July, residents say CRDA representatives told them they could be issued notices to vacate in September, meaning they would have to be out of their homes by December. The same statements were heard by a Press of Atlantic City reporter, who attended one of the meetings.
Palmieri, who met with the residents alone following the October meeting, insisted that while the authority sees the project as a priority, there is no there is no time line, as property appraisals are still underway. He stressed that he did not believe residents were told they would be evicted if they didn't act quickly but acknowledged that the authority needed to do a better job at communicating.
"If that's what you heard, I'm not going to question that," he said when asked about the time line. "Maybe that was the sense (CRDA staff) had at the time. I wasn't at the meetings But tenants will absolutely be given a reasonable heads up when we have information. We're not there yet."
Warren Massey was among the residents who attended the October CRDA meeting and a subsequent individual meeting with Palmieri. While he doesn't live in the area affected by the project, the former Atlantic City Housing Authority Board chairman said he became concerned over the authority's plans to displace residents. He has started a petition calling for CRDA to end all displacement efforts.
"(CRDA) botched the whole thing. People at those meetings were told there was a December deadline. It's total incompetence in terms of how things were handled," Massey said. "I would rather see a concerted effort by the CRDA to help rebuild this city than watch people be moved out of their homes for this. I would like the residents to be communicated with fairly and justly, and that's not what's happening.
Palmieri insisted that that residents will be given more than the state-mandated 90-days notice to leave, something not discussed during the authority's meeting with residents in the summer. He also said that residents like Taliaferro who rented storage units in anticipation of quickly moving out would be compensated by CRDA for the cost, including any fees associated with moving belongings back into their homes. Residents with children in the school system will not be displaced during a school year, he said.
"I could not imagine a scenario in which we would give the shortest amount of notice and be disruptive to parents in the school year. We need to communicate as thoroughly as we can so no one gets confused," Palmieri said.
Atlantic City Mayor Lorenzo Langford initially said he had concerns about the project. He later voted in favor of devoting CRDA money to the effort after he had been assured that the CRDA was willing to consider a land swap that would allow the city to create an affordable housing project, thus replacing the housing that would be lost in the South Inlet.
Discussions centered on CRDA trading property it owns outside of the Tourism District for city-owned property in the area of the South Inlet project.
Atlantic City Director of Planning & Development Keith Mills said the city would like to move forward with an appraisals but the CRDA is holding up the process.
“The part about CRDA’s reluctance to move forward that doesn’t make sense is that this would help them with regard to eventual replacement housing. We could have been six months ahead on this now,” Mills said.
Palmieri said the land swap is still under consideration. The CRDA board supports the idea, but has also suggested that if a parcel were to remain under CRDA’s control then the authority would be able to provide financing for development, he said.
“We haven’t talked to the mayor in weeks about this,” Palmieri said. “It’s not that we’re being difficult. We will work with the mayor to satisfy the housing goal. It’s just that we’ve not reached a decision.”