Gov. Phil Murphy’s administration has referred a complaint about land deals involving the Delaware River Port Authority to a state watchdog agency after progressive political groups wrote a letter calling for a probe of the authority’s real estate activities and the role of “special interests.”
“I request that your office review the complaints highlighted in the letter and take whatever actions you determine to be necessary,” the governor’s acting chief counsel wrote to the Office of the State Comptroller on Monday.
Earlier this month, leaders of New Jersey Working Families and Pennsylvania Working Families asked the governors of both states to open an investigation, and told members of the DRPA board in person that they were concerned about the authority’s connections “to a political machine that in our opinion prioritizes the lining of its own pockets.”
The Working Families groups highlighted two parcels of land the DRPA sold or optioned for development projects in Camden amid a boon in state tax incentives for businesses willing to relocate to the long-struggling city.
One of the pieces of land — a three-acre parking lot worth $2.3 million — was the subject of an Inquirer story in December about investments by political power broker George E. Norcross III. Both the DRPA and the Camden Redevelopment Agency held rights to the lot, and the DRPA’s own interest was valued at $800,000.
The DRPA sold the parking lot to developer Liberty Property Trust for $800,000, which in turn sold the lot to an investor group including Norcross for $350,000.
An attorney for the Norcross investor group has described the $350,000 transaction as part of a “swap” with Liberty, saying the investors gave up their rights to park on other waterfront land that Liberty needed for a major development project.
Port Authority CEO John Hanson has said the authority received fair market value for its rights to the three-acre parcel, and that he did not know a partnership involving Norcross would end up with the land.
The second parcel was a nine-acre lot the DRPA optioned to a developer of a ShopRite supermarket project that never came to fruition. The supermarket project was represented by the law firm led by Philip Norcross, George Norcross’ brother, Politico has reported. The law firm has also done work for the DRPA.
DRPA Board Chair Ryan Boyer pledged to meet with the Camden County NAACP about the status of the land when the group’s president, along with the Working Families leaders and other activists, addressed the board at a Jan. 15 meeting.
The DRPA maintains four bridges that connect New Jersey and Pennsylvania, and operates the PATCO commuter line. The authority came under scrutiny from the state comptroller in a 2012 report, which found that a “culture of weak policies” had contributed to wasteful spending and mismanagement of funds.
“Given that the Comptroller’s Office conducted a review pertaining to the Delaware River Port Authority in 2012 and the comptroller is responsible for reviewing finances and efficiency within government agencies, the administration believes referral to the comptroller is appropriate,” said Murphy spokesman Darryl Isherwood.
The DRPA said it is proud of its financial stewardship and hasn’t raised tolls since 2011. A spokesman called the Working Families complaint “misguided.”
“The authority has conducted these (land) transactions in an appropriate, legal and ethical way,” said spokesman Mike Williams. “All of the authority’s business is conducted in the most transparent process possible. The actions referenced in the complaint were presented and voted on during open public meetings.”
The referral was addressed to acting Comptroller Kevin Walsh on his first day on the job. Murphy nominated Walsh to the post last week, and on Monday Walsh was sworn into the role in an acting capacity by a Superior Court judge. Walsh awaits confirmation by the state Senate.
The Comptroller’s Office confirmed it had received the referral. Spokesman Andrew Cliver said the office does not comment on investigative work.
A civil rights attorney and affordable housing advocate, Walsh most recently worked as executive director of the Fair Share Housing Center.
Walsh takes over the office from Philip Degnan, whose scathing audit of the state’s multibillion-dollar corporate tax-break programs laid the groundwork for investigations that have roiled New Jersey politics over the past year.
The tax-break programs were revamped under a law signed by Gov. Chris Christie in 2013. Since then, the Economic Development Authority has approved about $1.6 billion worth of tax incentives for businesses that pledged to move operations and create jobs in Camden, one of New Jersey’s poorest cities.
The comptroller’s audit found “significant” problems with the EDA’s oversight of the programs, including a failure to determine whether companies actually created or retained the jobs in exchange for the tax incentives.
“We are pleased that Gov. Murphy has asked the comptroller to review special interests’ control over the DRPA,” Sue Altman, state director for New Jersey Working Families, said in a statement. “The secretive agency needs to reform its practices and work on behalf of toll payers and local communities — not the politically connected.”