The future of the South Jersey Economic Development District and the competence of Executive Director Gordon Dahl have been called into question by the Cape May County Board of Chosen Freeholders.
The freeholders are demanding that the SJEDD’s board take a vote of confidence in Dahl within 30 days. If the board does not unanimously support Dahl, he should be removed immediately and a “qualified permanent successor” should be found, according to a resolution passed unanimously Tuesday.
The same resolution also outlines a course of action for dissolving the district if it doesn’t prove to be financially stable within 90 days.
Dahl did not return phone calls or emails Thursday. His contract with the district, in place since 2008, automatically renews each February and has not been tied to any performance evaluations.
Freeholder Leonard Desiderio, who is also the chairman of the SJEDD board, said the resolution was the result of an executive session of the freeholder board in which Cape May County considered pulling out of the district.
Atlantic County severed its three-decade relationship with the district in January after discovering that the district had not completed audits in two years and had incurred hundreds of thousands of dollars in debts in the course of developing the NextGen Aviation Research and Technology Park in Egg Harbor Township.
Desiderio said he will ensure the district complies with the resolution, but despite its language, he does not believe the district should be dissolved. He declined to say whether he would support Dahl as executive director. Instead he pointed to pressures coming from people he declined to name as the driving factor behind the resolution.
“Whoever is pushing everybody’s buttons wanted it dissolved immediately. I asked the freeholders if they would please give us 90 days because the district has been so important to this region,” Desiderio said. “It’s unfortunate that the district has been put in this position, and it’s unfortunate that Gordon has been put in this position.”
Bill Whelan and Julia Acton, the SJEDD’s executive committee members from Cumberland and Salem counties, respectively, did not return calls Thursday.
Meanwhile, Cape May County does not want to take any more chances with the NextGen park. The resolution calls for the SJEDD’s board to immediately find a “competent interim manager” to guide the district through the resolution of the project.
The SJEDD, which has led a $7 million infrastructure installation at the park, has been under pressure to turn over the lease agreement for the park’s land to the park’s board. The district has refused to turn over the lease unless it is reimbursed for $858,000 spent over the course of the project that is not reimbursable under grant agreements. The district also has a $350,000 mortgage against the park’s land.
Ed Salmon, president of the park’s board of directors, said he would consider the transition a “good sign” and said the board’s primary focus is on getting the lease transferred.
A watchdog report by The Press of Atlantic City last month revealed that contractors who have completed work at the park are owed $495,000. One of those contractors has since sued the district for $169,700, and others have threatened legal action as well.
In January, Dahl and the district’s then-attorney Noah Bronkesh turned down a bridge loan from the state Economic Development Administration that would have allowed the district to pay those contractors. The terms of the loan would have required the district to simultaneously turn over the lease for the park’s land, and thus not recoup the $858,000.
“The (park board’s) position is the executive director took many unnecessary and imprudent risks in incurring these expenses and pursuant to our memorandum of agreement with the district, we are not responsible for them,” said Howard Kyle, Atlantic County’s representative to the board. “However, our interim master developer is looking at one of those costs — architectural design work — and if he is able to use those plans, the district may recover some of those costs.”
Desiderio said the district hopes to recoup $500,000 by selling the park’s architectural drawings and could take out loans to pay the contractors.
Cape May County’s resolution calls for the district to resolve all of its financial and operational difficulties within 90 days and demonstrate that it can sustain itself within that timeframe. If all counties are not assured the district is viable, it should be dissolved. The resolution states that the SJEDD will need to satisfy all outstanding debt, divide assets and equitably separate all employees before dissolving the district. The district has three employees, including Dahl.
The federal EDA’s Philadelphia Regional Office oversees the SJEDD. An EDA spokesman did not return calls Thursday seeking comment on the process of dissolving a district and changing its leadership.
Atlantic County Executive Dennis Levinson said officials from the three remaining counties — Cape May, Cumberland and Salem — have consulted Atlantic County in deciding how to proceed.
“We have agreed that we will work with them in any capacity that we can as they straighten things out,” Levinson said.
U.S. Rep. Frank LoBiondo, R-2nd, was provided with a copy of the Cape May resolution, as was Levinson and the other member counties.
“I agree with the Cape May County freeholder board in calling for greater accountability at the SJEDD. I believe the timeline and concerns set forth in their resolution are reasonable to evaluate if the SJEDD can meet its obligations,” LoBiondo wrote in an email.
The SJEDD, which ordinarily meets four times a year, has not scheduled its next meeting. A meeting scheduled for Monday was canceled after a number of board members could not attend. When Dahl was asked last week about the district’s next meeting, he told The Press that a meeting had not been set, despite the fact that a public notice of the meeting had already been printed.
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