HomeMy Public PortalAboutOrd. 07-09
No. 07-09
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tNorong4 of Cllctrterd1 ~ ~ 3J ~
Councilman
Presents .the following Ordinance Seconded by Councilman
THIS ORDINANCE SECURES BONDS OR OTHER OBLIGATIONS ISSUED IN
ACCORDANCE WITH THE PROVISIONS OF THE 'REDEVELOPMENT
AREA BOND FINANCING LAW' AND THE LIEN HEREOF IN FAVOR OF
THE OWNERS OF SUCH BONDS OR OTHER OBLIGATIONS IS A
MUNICIPAL LIEN SUPERIOR TO ALL OTHER NON-iVIUNICIPAL LIENS
HEREAFTER RECORDED.
ORDINANCE APPROVING THE EXECUTION OF
FINANCIAL AGREEMENTS WITH GATEWAY AT
CARTERET URBAN RENEWAL, LLC AND
CAMELOT AT CARTERET URBAN RENEWAL,
LLC AND OTHER APPLICABLE DOCUMENTS
RELATED TO THE ISSUANCE BY THE
CARTERET REDEVELOPMENT AGENCY OF
REDEVELOPMENT AREA BONDS (NON-
RECOURSE TO THE FULL FAITH AND CREDIT
OF THE BOROUGH) AND DETERi\HNING
VARIOUS OTHER MATTERS IN CONNECTION
THEREWITH.
WHEREAS, the Local Redevelopment and Housing Law, NJ.S.A. 40A: 12A-] ef
seq. (the (<Act"), as amended and supplemented, provides a process for municipalities to
participate in the redevelopment and improvement of areas in need of redevelopment; and
WHEREAS, pursnant to the Act, the Borough of Carteret, in the County of
Middlesex, New Jersey (the "Borough") designated certain areas of the Borough,
constituting Block 243, Lots 1-5, Bloek 252, Lots 1-5, Block 253, Lots 1-7, Block 254,
Lots 1,2,3.0],3.02,4.01,6-10 and 12-]4, Block 260, Lots 7-]5, Block 261, Lots 1-8,
Block 272, Lots ]-6, 6.01 and 7-]6, Block 273, Lots 10-12 and Block 292, Lots 1-3, all
as identified on the official tax maps of the Borough, as an "area in need of
redevelopment" (the "Redevelopment Area"); and
WHEREAS, on Febnlary 6, 2003 the Governing Body adopted Ordinance No.
03-02, approving and adopting a redevelopment plan, entitled "The Lower Roosevelt
Avenue Redevelopment Plan", superseding the provisions of the Borough Zoning
Ordinance for the Redevelopment Area (the "Redevelopment Plan"); and
\VHEREAS, the Redevelopment Plan provides for, among other things, the
construction of mixed use improvements, consisting of for sale and rental residential
components and a retail component on the Redevelopment Area; and
"'HEREAS, on February 18, 2003, the Borough adopted Resolution number 03-
113, designating Kaplan at Carteret, L.L.C. (the "Redevelopertt, and predecessor in
interest to the Entities (as defined herein)) as the redeveloper of the Redevelopment Area
and authorizing the negotiation of a redevelopment agreement with the Redeveloper; and
'VHEREAS, the Redeveloper has agreed to implement the Redevelopment Plan
and develop, design, finance and construct a mixed-use project including approximately
forty-eight (48) townhouses (the "Townhouse Component"), up to one hundred thirty-
eight (138) condominiums (the "Condominium Component"), approximately two
hundred eight (208) rental apartments (the "Rental Component") and approximately
forty-two thousand nine hundred (42,900) square feet of retail spaee (the "Retail
Component" and, together with the Townhouse Component, the Rental Component and
the Retail Component, the "Project") and in connection therewith, the Redeveloper has
agreed to devote substantial cash assets and borrowed funds to the completion of the
Project; and
NO.
07-09
PAGE~
'VHEREAS, in order to implement the development, financing, construction,
operation and management of the Project, the Borough entered into a redevelopment
agreement with the Redeveloper dated Febmary 25, 2004, as amended by the First
Amendment to the Redevelopment Agreement, dated Jnly 13, 2004, the Second
Amendment to the Redevelopment Agreement, dated February ]6, 2005 and the Third
Amendment to the Redevelopment Agreement, dated February 16,2005 (collectively, the
"Redevelopment Agreement"), which Redevelopment Agreement specifies the rights and
responsibilities of the Borough and the Redeveloper with respect to certain aspects of the
Project; and
WHEREAS, by Resolntion No. 05-48, adopted by the Borough Conncil on
January 27, 2005, pursuant to Section 4 of the Act (NJ.S.A. 40A: 12A-4), the Borongb
designated the Carteret Redevelopment Agency (the "Agency") to act as the
"Redevelopment Entity" (as such tern] is defined in the Act at NJ.S.A. 40A:12A-3) for
the Redevelopment Area to exercise the powers contained in the Act to facilitate the
developm~nt ~~l~~~eV~?pment o~the Redevelopt1]cnt Area; an~
"'HEREAS, despite the Redeveloper's investment of equity and borrowed funds,
such amounts are insufficient to pay for all of the costs associated with the development
and construction of the Project; and
WHEREAS, pursuant to the Redevelopment Agreement, the Borough and the
Redeveloper are to share pre*development costs, including, but not limited to the cost of
acquiring the Redevelopment Area, Relocation Costs, costs of demolishing existing
structures on the Redevelopment Area and costs incurred in connection with
environmental remediation of the Redevelopment Area in accordance with New Jersey
Department of EnvirOlilllental Protection standards (collectively, the "Shared Pre-
Development Costs"); and
\VHEREAS, pursuant to the Redevelopment Agreement, the Borough will
reimburse the Redeveloper for one hundred percent (100%) of documented Shared Pre-
Development Costs in excess of$II,400,000 bnt less than $13,900,000, and fifty percent
(50%) of documented Shared Pre-Development Costs incurred in exeess of $13,900,000
(collectively, the "Borough Pre-Development Cost Contribution"); and
\VlIEREAS, in order to implement the development, financing, construction,
operation and management of the Project, on Febntary 10, 2006, the Redeveloper fanned
two urban renewal entities under the provisions of the Long Term Tax Exemption Law,
NJ.S.A. 40A:20-1 el seq. (the "Long Term Tax Exemption Law") and the New Jersey
Limited Liability Company Act, N.J.S.A. 42:2B-l el seq., known as Gateway at Carteret
Urban Renewal, LLC ("Gateway") and Camelot at Carteret Urban Renewal, LLC
("Camelot" and, together with Gateway, the "Entities"); and
'VHEREAS, Gateway will be responsible for implementing the development,
financing, constmction, operation and management of the Townhouse Component and
the Condominium Component and Camelot will be responsible for implementing the
development, financing, construction, operation and management of the Rental
Component and the Retail Component; and
\VHEREAS, the provisions of the Long Ternl Tax Exemption Law and such
other statutes as may be sources of relevant authority, authorize the Borough to accept, in
: lieu of real property taxes, annual service charges paid by the Entities to the Borough as
set forth in such laws ("Anllual Service Charges"); and
\VHEREAS, in accordance with the provisiolls of the Long Term Tax Exemption
Law, on April 12, 2007, the Entities filed applications with the Borough seeking tax
exemptions in connection with the Project (the "Applications"); ane}
\VHEREAS, the Borough is agreeable to granting such tax exemptions to the
Entities and, pursuant to the Long Term Tax Exemption Law and such other statutes as
may be sources of relevant authority, the Borough desires to enter into Financial
Agreements with the Entities to memorialize the temlS and conditions by which the
Entities will pay the Annual Service Charges; and
NO. ---47.-09-
PAGE~
"'HEREAS, to assist the Borough in fInancing the Borough Pre-Development
Cost Contribution and certain other Borough costs as set forth in the Redevelopment
Agreement, the Redevelopment Agency, as redevelopment entity, will issue bonds (the
"Bonds") pursuant to the Redevelopment Area Bond Financing Law, N.J.S.A. 40A:12-
64, et seq., (the "Bond Financing Law"); and
'VHEREAS, pursuant to the Bond Financing Law and such other statutes as may
be sources of relevant authority, if any, the Borough intends to pledge, to the extent
required, the Annual Service Charges paid to the Borough by the Entity for debt service
on the Bonds, orovided. however, that five percent (5%) of the Annual Service Charges
shall not be subject to such pledge in accordance with N.J.S.A. 40A:20-12 (the "County
Share"); and
WHEREAS, Borough and the Entities have agreed tbat any portion of the Annual
Service Charges paid by the Entities to the Borough in excess of the amount needed to
pay the County Share and Debt Service on the Bonds shall be returned to the Borough
and retained and used by the Borough for any lawful purpose; and
"'1IEREAS, the Borough made the following findings:
A. Relative Benefits of the Project:
The Project will provide new residential units in the Borough.
B. Assessment of the importance of the Tax Exemption in obtaining
development of the Project and influencing the locational decisions of
probable occupants:
i. Exemption pennits private development of residential units in the
Redevelopment Area.
ii. Redevelopment of the Area will cause the creation of construction
employment opportunities for local residents.
'YHEREAS, the Entities are qualified to do business under the provisions of the
Long Ternl Tax Exemp~ion Law and have submitted to the Mayor tax exemption
applications which are on file with the Borough Clerk (the "Applications"), requesting tax
exemptions for the Project; and
'VHEREAS, the Entities also submitted financial agreements to the Mayor, which
are on file with the Borough Clerk (the "Financial Agreements") (capitalized tenns not
defined herein shall have the meaning assigned to such tenns in the Financial
Agreements); and
WHEREAS, the Mayor has snbmitted the Applications and Financial Agreements
to the Borough Council with his reconunendation of approval (the "Mayor's
Recommendation"), a copy of which is on file with the Borough Clerk; and
'YHEREAS, the Financial Agreements contemplate that the Annual Service
Charges will be dedicated to debt service on the Bonds pursuant to the Bond Financing
Law; and
"'HEREAS, in order to set forth the terms and conditions under which the
Entities and the Borough (the "Parties") shall carry out their respective obligations with
respect to payment of the Annual Service Charges by the Entities, in lieu of real property
taxes, in connection with the Project and with the issuance of the Bonds by the Agency,
the Parties have detemlined to execute these Financial Agreements; and
WHEREAS, tbe Bond Financing Law requires the approval of the State Local
Finance Board prior to the issuance of financial instruments, such as the Bonds, where
such financial inst11lments are to be secured by payments in lieu of taxes such as the
Arumal Service Charges; and
NO. 07~09
PAGE~
\YHEREAS, the Borough Council has also detennined to authorize the execution
of certain agreements, including without limitation, the Financial Agreements, in
connection with the exemption of the Project from taxation and the financing described
herein; and
WHEREAS, the Borongh finds that the Project will result in the redevelopment of
the Borough and will revitalize the Borough and bring new growth because it will (a)
provide additional housing, retail and community space; (b) increase mobility by acting as
a draw for residents and renters from the surrounding communities; (c) assist in the
redevelopment of the Borough by providing modern and efficient retail, living and
amenity space; and Cd) improve the quality ofHfc by providing greater retail and housing
options for the citizens ofthe State; and
'VIIEREAS, the Borough believes that (a) it is in the public interest to undertake
the Project; (b) the Project is for the health, welfare, convenience or bettemlent of the
inhabitants of the Borough; and (c) the Project is an efficient and feasible means of
providing services for the needs of the inhabitants of the Borough and will not create an
undue financial burden to be placed upon the Borough.
NOW, THEREFORE, BE IT ORDAINED BY THE DOROUGH
COUNCIL OF THE DOROUGH OF CARTERET, NEW JERSEY AS FOLLOWS:
1. The Applications are hereby approved in accordance with the
Mayor's Recommendation.
2. Exemption from taxation is hereby granted to the Entities for
their respective portions of the Project for the term set forth in the Financial
Agreements, but in no event shall the tax exemptions exceed the earlier of (i) thirty-
five (35) years from the date of execution of the respective Financial Agreements or
(ii) to the extent pelmitted by N.J.S.A. 40A:20-13, thirty (30) years from the
commencement of the Annual Service Charges and only so long as the Entities remain
subject to and comply with the Financial Agreements and the Long Teml Tax
Exemption Law and upon the further condition that neither Entity files a petition oftnx
appeal for the premises on which any portion of the Project is to be located, excepting
any appeal filed prior to the adoption of this Ordinance.
3. The Mayor is hereby authorized to execute, on the Borough1s
behalf, the Financial Agreements and any other related documents substantially in the
forms on file with the Borough Clerk, subject to such necessary additions, deletions,
modifications or alterations deemed necessary by the Mayor in consultation with the
Borough's general counsel and/or bond counseL
4. Executed copies of the Financial Agreements shall be certified
by the Borough Clerk and filed with the Office of the Borough Clerk.
5. The Project, when completed, shall confoml with all Federal and
State law and ordinances and regulations of the Borough relating to its constmction
and use.
6. The Entities shall, in the operation of their respective portions of
the Project, comply with all laws so that no person shall, because of race, religious
principles, color, national origin or ancestry, be subject to any discrimination.
7. The Entities shall pay the Annual Service Charges as set forth in
the Financial Agreements.
8. The following occurrences are express conditions to the grant of
these tax exemptions to be perfomlcd by the Entities:
(a) The Entities shall pay full real estate taxes on the land for the
portions of the Redevelopment Area on which the Retail Improvements will be
constructed.
NQ. 07-09
PAGE~
(b) The Entities shall not, without prior consent of the Borough as
set forth in the Financial Agreements, convey, mortgage or transfer all Of any part of
their respective portions of the Project which would sever, disCOlmect Of divide the
improvements being tax exempted under the Financial Agreements from the land
underlying the exempted improvements.
(c) Camelot shall be deemed to impliedly agree that if it operates,
controls or manages the Rental Component of the Project, it will, in good faith, assist
the Borough in its goal of having all new jobs arising out of the businesses conducted
on the Redevelopment Area after substantial completion thereof offered to B:orotigh
residents first.
(d) Camelot shall, concomitantly with the submission of the
auditors' reports reqnired by NJ.S.A. 40A:20-9(d), where applieable, attaeh
employment reports under oath, with particl!lars, sJ1!!:il1g the manper .andthe ext~nt ttL
WhICh It has complIed with lO(cYabove. The employment reports, like the auditors'
reports, shall be filed with both the Borough's Chief Financial Officer and the Borough
Clerk.
(e) Each Entity shall pay any outstanding real estate taxes and all
outstanding water and sewer charges on the portions of the Redevelopment Area it
owns within one year of the adoption of this ordinance.
(f) The Entities shall complete their respective components of the
Project as set forth in the Applications.
9. The Mayor is hereby authorized to take all necessary and appropriate steps to assist
the Agency in its application to the State Local Finance Board for approval to issue the
Bonds for the funding ofthe Borough Pre-Development Cost Contribution.
10. After receipt of the approval from the State Local Finance Board
for the Agency financing described herein, the Mayor is hereby authorized to take all
necessary and appropriate steps for the Borough to assist the Agency to cause the
issuance of the Bonds, including the pledge or assigrunent of the Annual Service
Charges to secure payment 011 the Bonds and the execution of the Financial
Agreements and any other documents necessary to facilitate such financing.
11. The Mayor is hereby authorized to draft, amend, modify or
make such necessary changes to the Applications, the Mayor's Recommendation, the
Financial Agreements or any other necessary documents to effectuate the issuance of
the Bonds by the Agency that will be secured by the Aromal Service Charges, provided
that any and all such documents are in compliance with the provisions of the Bond
Final1cing Law and the terms of the Tmst Indenture governing the Bonds to be issued.
. ~ - 12.- - fIJis ordinance shall take effect twenty (20) days after the first
publlcatlOll thereof after fmal adoption as provided by the Bond Financing Law.
DO NOT lISE SPACE BELOW THIS LINE
RECORD OF COUNCIL VOTE
COUNCILMAN YES NO NV A.B. COUNCILMAN YES NO NV A.B.
BEllINO X X
DIAZ X RIDS X
KRUM X SITARZ X
x ~ Indicate Vote AS - Absent NV - Not Voting XOR - Indicates Vote to Overrule Veto
ON
!
I
CJ-
Affidavit of Publication
Publisher's Fee $54.56
} SS.
State of New Jersey
Middlesex County
Personally appeared Catherine Williams
Ofthe Home News Tribune, a newspaper printed in Freehold, New Jersey and published in NEPTUNE,
in said County and State, and of general circulation in said county, who being duly sworn, deposeth and saith
that the adveliisement of which the annexed is a true copy, has been published in the said newspaper
1 times, once in each issue as follows:
7/05/07
"
ments In lieu of taxes to the Borough. Further, the
~ft:e~~~t~~~f;~\~ell~~f~x~'fo'~ W~~~~~t
of debt selVlce on bonds to be issued by the
charge,
s Office,
to 4:00
and Fri-
T
lng of
~~bln~.
ereel on
meeting
011 JUljl
n>nrIa~t, ~~wl~~e~U~I€I~if.ijch
~, is lnterested WIll be given
KATHLEEN M. BARNEY, MMC
MunIcIpal Clerk
($54.56) 452761
AD. 2007
~mluvm~
Sworn and subscribed before me, this
5 day of July, 2007
o
41" ()7-dCJ
AFFIDAVIT OF PUBLICATION
The following is a true copy of an Ordinance or
Resolution of the Borough of Carteret that has
appeared in the Home News Tribune, a newspaper
which is printed in Freehold, New Jersey and published
in Neptune, in said County and State and of general
circulation in said county. one (1) times, once in each
issue as follows:
July 5, 2007
~~"'../ 6. /?-t-.~-'
Notary Public of New L~rfJ1~illVERA Kath~e~n Barney, RMCI
NOTARY PUBLIC OF NEW JERSEY MUnicipal Clerk
MY COMMISSION EXPIRES MAY 2, 2011
Sworn and subscribed before
me this 9M day oU ~ I .). co',
/ 0-
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