CAPE MAY — City Council has introduced a $3.4 million bond ordinance to purchase properties on the north side of town for a 38-acre park.

The ordinance, which is scheduled for a public hearing and council vote in March, is not expected to raise the tax rate because much of it will be paid for by state Green Acres and Blue Acres funds, with any local share coming from the city’s own open space fund.

Mayor Ed Mahaney said the bond ordinance is merely the funding mechanism for the deal that will include buying the former Vance’s Bar property off Lafayette Street and two residential properties on St. John Street.

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After the bar closed, the property was slated for a 24-unit condominium development, but the housing market declined and there were some pollution concerns from a city coal-gasification plant that operated nearby from the 1880s to 1937.

Mahaney did not want to give specific details because the acquisitions are in the negotiation stage. Officials have previously said they expect land acquisition to cost more than $3 million.

The ordinance indicates the city expects to receive $1,567,050 in state funding. Local open space funds are collected from taxpayers, but this money already has been collected, with almost $2 million banked.

“We are in negotiations with the owners of the properties. Vance’s is owned by a bank as the development company lost it in foreclosure. The two (lots) on the east side of St. John Street are under private ownership,” Mahaney said.

The city announced plans in May 2011 to create a park on that side of town, complete with nature trails, basketball courts, picnic pavilions, bocce, shuffleboard, soccer and other amenities. The city has a few small parks but nothing of this size with these amenities. There already is a Little League baseball field there, and open space owned by Cape May Elementary School will be incorporated into the park.

The gasification plant has raised questions about the land, and helped derail SSJ Development’s plan to construct condominiums, but officials say it is safe for surface-level recreation.

Remediation work, including soil removal and installing monitoring wells to track pollutants in groundwater, has been done. Through a number of utility company mergers, Jersey Central Power & Light now owns the gasification plant property. The company has helped clean up the site and will donate some of the land to the city.

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