The South Jersey Economic Development District has less than a month and a half to prove to its member counties it can be financially sustainable.

If it fails to do so, the district will be dissolved. Steve O’Connor, the district’s interim executive director, will deliver his first impressions on the financial status of the district at a board meeting tonight on the Cape May Court House campus of Atlantic Cape Community College.

O’Connor was brought on earlier this month at a monthly salary of $9,500 after the board unanimously voted to fire Gordon Dahl, who has been the district’s leader for 25 years. Under Dahl’s leadership, the district fell into significant debt while leading an infrastructure installation at the planned NextGen Aviation Research and Technology Park.

According to resolutions passed in Cape May, Cumberland and Salem counties — the three counties that compose the district — the agency has until June 11 to demonstrate its viability.

Last week O’Connor attended an executive session of the NextGen park’s board and provided an update on the complicated process of transferring the lease for the park’s land to the park’s board. Park officials have said the district is being cooperative but have not disclosed details regarding transfer negotiations.

At tonight’s meeting, SJEDD is scheduled to discuss and possibly take action on the future of a planned housing project in Egg Harbor City. The district owns vacant property at 145 to 147 Philadelphia Avenue that was planned for affordable-living senior housing mixed with 1,120 square feet of retail space.

The district was planning to construct the building and sell housing units for $134,900 each, according to its website. A financial report on the district’s assets values the vacant property at $96,831.

During the meeting’s executive session, the board is expected to discuss the lease transfer and anticipated litigation. Dahl has threatened to sue the district, alleging breach of contract, conspiracy theories and defamation. He was looking for more than $1 million in settlement costs, according to a letter sent by his attorney to the district. A formal lawsuit has not yet been filed.

Dahl’s salary had increased by more than 40 percent between 2006 and 2011. He also took in $17,189 in vacation buybacks between 2009 and 2011, according to payroll records.

The board also will discuss and possibly take action on a district vehicle, which had been assigned to Dahl. In the agency’s most recent audit, which covered March 2009 through March 2010, auditors found that Dahl was driving the car from his home in Mays Landing to the district’s office in Millville but had not properly reported that use to the Internal Revenue Service. Auditors concluded that the IRS could impose penalties if they examined the situation.

Contact Jennifer Bogdan

609-272-7239