Plans for a mixed-use development project expected to transform sections of the South Inlet’s blighted and vacant neighborhoods into a bustling downtown with restaurants, shops and housing moved forward Tuesday as the project received $1.2 million.
Money devoted by the New Jersey Casino Reinvestment Development Authority will allow the agency to move forward with acquiring portions of five city blocks — through eminent domain if necessary — for the first phase of the project. The acquisition process is expected to cost about $25 million. Most of that money will likely be loaned to the CRDA through an agreement with the state Economic Development Authority.
A nonbinding financing arrangement with the EDA to obtain $50 million in loans for the project was also approved by the CRDA on Tuesday. The state EDA last week approved the same agreement for the funding — about half of which will go to the acquisition process and the other half going toward roadway improvements and the improvement of other blighted properties in the South Inlet. The arrangement will allow for the EDA to borrow the money from a lender that would fund the bank loan in notes.
CRDA Executive Director John Palmieri called the announcement of the financing arrangement between the state agencies a “very powerful and important” agreement. The CRDA might seek to increase the arrangement in the next two to three years as other phases of the project are planned, he said.
The blocks included in the project are bordered by Connecticut, Rhode Island, Oriental and Pacific avenues. A few parcels on Oriental Avenue north to Vermont Avenue are also included. Only properties in those blocks are being considered for what is being called the first phase of the project. However, the project’s boundaries could be extended if the authority moves into a second or third phase, said Bunny Rixey, the CRDA’s director of real estate and development.
Included in the project’s boundaries are more than 60 residences in the low-rise Vermont and Metropolitan plazas, as well as a handful of other residences. The CRDA’s approval means that residents in those areas will be displaced. Letters will soon be sent to all of the affected residents inviting them to attend a public meeting. One-on-one sessions between residents and CRDA officials will follow.
Mayor Lorenzo Langford, who is a member of the CRDA board, said he initially had concerns about the plans to displace city residents, but those concerns were assuaged after CRDA officials showed a willingness to work with the city.
Board Chairman James Kehoe said the CRDA is working on plans to build replacement housing to compensate for the residences that will be demolished, but those plans have not yet been made final. Langford said the housing should be built near the current housing and allow for essentially the same living arrangements and financial situations that the residents have now.
“There is a sensitivity to the whole housing issue here in Atlantic City,” board Vice Chairman Robert Mulcahy said.
State regulations dictate that people in areas targeted for public projects should receive $4,000 in relocation expenses plus $500 in moving costs, but the CRDA’s offers are more generous than the state regulations.
Renters are offered $9,600 over three years. That money can go toward a down payment on a new property or can help offset rent. An additional $750 is offered in fixed moving expenses or the CRDA will pay for movers provided that the individuals obtain multiple estimates.
All properties in the project area will be appraised, and offers will be made to the owners, who may also have their own appraisal done to challenge the CRDA’s appraisal. The CRDA also pays for all costs associated with the purchase of a new property, including closing fees and attorney fees.
The CRDA helps residents and homeowners identify comparable living situations and provides transportation to property viewings. The agency also inspects each new property selected by the residents — even if the properties are out of state — to determine that they are safe and up to code.
The same process has been used for residents affected by the CRDA’s past projects, including a road-widening project related to Revel that affected Connecticut, Delaware, Mediterranean and Massachusetts avenues. Six properties were affected by that project.
“We’ve had people come here in tears, and when we’ve relocated them, they’ve brought us doughnuts and thank-you notes. They’re always in a better place once they’re relocated,” Rixey said. “If you look at the area of town that we’re doing the project, it’s because it’s in need of redevelopment.”
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