Tag Archive: Xanadu

Good luck Sen. Whelan

At the Meadowlands today Sen. Jim Whelan (D- Atlantic County) said, “If we do this right we will find a way to save and strengthen the horse racing industry, find a way to save and strengthen the casino industry, and at the same time find a way to get Xanadu finished.” Good luck, Sen. Whelan. Casinos, horse racing, and Xanadu are in deep financial trouble, beyond just fixes which the legislature or the governor can implement. The solutions being discussed are primarily about gaming – an independent agency to revive the AC casino business, slots/VLT’s for horse racing, and a possible casino attached to Xanadu.

The second Democratic Gaming Summit was held today at the Meadowlands Racetrack with about 1,000 in attendance – union members, race track enthusiasts, “suits” representing moneyed interests, and legislators trying their best to appear impartial while just as frequently representing the interests of their local constituents and business supporters.

A rising tide raises all boats, and certainly a better economy is what we need. However, the competition in the gaming industry will only get fiercer and continue to cannibalize itself. Internet gambling as it expands, which it will regardless of what the federal government wants, will only make physical location gambling more problematic. Gaming might produce short term gratification but longer term broader-based solutions are needed.

A better solution in Atlantic City where failing casinos are in death-like competition with surrounding states and some are worth only a fraction of their value four years ago, might be to return to its roots as an ocean-front family-friendly vacation resort which now happens to allow gambling. The Meadowlands race track at a minimum will have to tighten its belt but might have lessons to learn from the success this year at Monmouth. As Xanadu is located in a county with an excess of shopping malls, its new developer (when/if selected) might benefit by looking more at the entertainment, rather than retail, aspect of its proposed business model.

 

Needed: A venue Worthy of its Two Names

Our state government has adopted an unwise short-term strategy for Xanadu, also now called Meadowlands. Development for this shopping and entertainment center started in 2004 as a project of Mills Corp., and was sold to a Colony-led group in 2006. Now after about $2 billion in investment and up to another $ 1 billion needed to complete it, this center is in the hands of a group of its debtors.  It was an ill-conceived project in 2004 and remains so today.

The new group will have to deal with the state which understandably is trying to resuscitate the project, but with little forersight.  Michael Drewniak, a spokesman for Gov. Christie, on Tuesday said, “It really doesn’t matter to us who the title holder of the property is. What’s most important is that it’s an entity ultimately that can handle the project and complete it.” For a large property in one of the northeast’s most desirable locations, setting their sights on an entity that “can handle the project and complete it” displays a lack of imagination.

This white (but garish) elephant deserves better.  If investors thought that this retread concept of another huge mall with a few added entertainment venues was such a great idea, Colony would have found the funds to complete the project. Instead Colony surrendered it to lenders.

The state should carefully explore its options and not rush into a deal which only offers more of the same stale vision. In a wonderful book written in 1999, The Meadowlands: Wilderness Adventures on the Edge of a City, the intrepid author Robert Sullivan takes many bus trips from his apartment in NYC to tramp through muck and by canoe to explore the rivers, marshes, birds, and fish in this richly diverse land. Why not, among other attractions, have Xanadu be the starting point for similar adventures. After much restoration this area is more wondrous now.

Most everyone agrees the current facade could not be uglier. It reminds me of many large, tacky warehouses along our highways. The Star Ledger in a video accompanying its article has solicited some creative and fun suggestions.

The Star Ledger says the state is now in conversation with two potential developers and is considering providing tax exemptions. Such might entice completion, but is of no benefit in the long run if the center fails to attract sufficient vendors or customers. Others argue for additional gambling there. Such might offer a short term advantage but will quickly be caught up in a competitive, self-cannibalizing industry with diminishing financial gains for the venue and the undesirable side effects of gambling. A state commission recently recommended that if the project doesn’t move ahead the state should move quickly and aggressively toward foreclosure and seeking damages. Such might ultimately prove necessary, but I hope the state will continue to pursue a wide range of options – ones that do not just add lipstick to the pig but will give us a venue worthy of its two names.

What do you think?

The Double Standard

Chris Christie’s double standard never ceases to amaze! But it’s more than past time that we all take on his “double speak” each time he does it!  For instance and I paraphrase slightly: “Why would I put more money into a broke pension system?” Of course, why ask the obvious: “Why is it broke?” Has he contributed to the severe pension problems by skipping state pension payments in this year’s budget? Even Governor Jon Corzine, whom he trashes at every opportunity, managed to pony up a portion of the state’s contribution.  By the way, public employees have continued to pay their own share each and every year.

Now to the budget.

Need $7.5 million for family planning centers? Oh, not a priority, according to the Gov. We can’t possibly find that.

Need $65 million to close a gaping budget hole when it was realized that doing away with the Sunday closing laws in Bergen County would make a very serious political problem for Republicans in Bergen? Oh, that was easy. Just say “We’ll improve tax collections”…..and poof, we found $65 million in anticipated revenue.

Need $5 million to buy Senator Doherty’s vote for the budget? Just change another line item.

Gee, a political problem when the Christie budget increased the co-pay for the prescription program for low income seniors. Oh that was easy too, let’s get dollars from the national democratic health care reform money coming to our state. You know, the same program his party has been bad mouthing.The one Republicans worked hard to defeat.

Maybe removing more than 900 folks from receiving life saving drugs is not such a great idea. Got caught short on that one when Senator Joe Vitale and the Governor’s Advisory Commission on Aids brought it to light. Find the dollars by just saying we’ll get better discounts from the pharmaceutical industry and then criticize the Senator “for playing politics” when he wrote to restore these much needed funds.  That was really a smooth one Governor! Well maybe those same pharmaceutical companies can increase the discount in the employee prescription program for the family planning centers.

Tax credits (or even bail outs …. Xanadu?) for private business are good ideas if we can keep jobs in New Jersey. No big argument here. So let’s do it to keep Honeywell in Morris County. Oh the TV and movie industry? Gee who cares if Law & Order moved from North Bergen to New York to film their series. Who cares if that part of North Jersey lost jobs and all the small business around who serviced such endeavors?  Governor, tell us the difference between the two.

Ok. You all have the idea. We should headline these in Blue Jersey each and every time he does it. Did I miss any? Send them in.

Now back to Family Planning Centers. Every major newspaper in the state has endorsed the restoration of these funds. Organizations like Catholics for Choice, Women’s Political Caucus, Women Advocating for Good Government (WAGG) and The League of Women Voters have already supported this effort and are lining up their membership. I expect to hear soon from the National Council of Jewish Women. The Legislative Black Caucus has also joined the chorus. We cannot let folks get away with claiming this is a budget problem! It is not. The Governor knows it, the Treasurer probably knows it which is why he was afraid to be questioned in public and certainly the Commissioner of Health & Senior Services knows it. And don’t keep repeating that the Federally Qualified Health Centers can take the new patients. They can’t. They’ve said so themselves and their financial reports back them up.  And again, don’t repeat that the CEED program can take all comers for mammograms and pap smears. Maybe they can, but where do these women go to get the doctor prescriptions they need to access these services.  Stop the myth spinning. Women’s health is too important to continue this cynical endeavor to placate the right wing of the Governor’s party!

The women (and many of the good men) in our state will not let any legislator stand up with a straight face and try to claim this is all about the budget, or that poor women will have access to health care without this funding.

Assemblywoman Stender and I have not yet talked to our legislative leadership to work out the timing of a legislative override. It has to originate in the Senate, since that’s where the bill originated. We’ll let you know as soon as we have an agreed upon schedule.  In the meantime, keep letters and emails coming to the legislature. We absolutely need your help on this one. Get your family, neighbors, and friends to join the growing chorus. This is the time for all blue (and even red) New Jerseyans to join together and start with the Senate – your own Senator or any other you know.

Keep your voices heard!

 

The Mistake in the Meadowlands

Promoted by Jason Springer: 75% of revenues for 20 years???

In light of Governor Christie’s announcement concerning Xanadu, I thought I’d crosspost this from GSP. Displaced jobs, surrendered tax receipts, and the promise of part-time employment. What a winning combination!

So now I understand why the Chris Christie budget included so much revenue from repealing the Bergen Blue Law – because he plans to sink a ton of money into Xanadu.

Three sources familiar with a proposal under serious consideration by the Christie administration said that taxpayers – via a provision of the state’s Economic Stimulus Act of 2009 – could, in effect, invest about $180 million in the long-stalled project. That money would come in the form of an annual diversion to the developers of 75 percent of the state sales tax revenue generated by the project after it finally opens – for as long as 20 years, or until the $180 million cap is reached.

Yeah, the Christie Administration is going to give up 75% of its tax revenues from Xanadu for twenty years! That means that 5.25 cents of every dollar spent on taxable items in Xanadu will not go to fund the government, as it should. No, it will go towards making a developer rich, twenty years after he completed a construction project.

Unbelievable.

Sports & Entertainment: 3 Ill-Conceived Ventures

Three Bad Ideas: 1) The notion that the State of New Jersey could do a good job running Sports & Entertainment venues; 2. that Xanadu would become a great success; and 3) that the NJ Nets Basketball team could be successfully moved to Brooklyn.

First lets address one delusion of Governor Christie, as reported in today’s Record. Regarding any deal between the Nets and the Devils under which the the basketball team would move to Newark, Governor Christie said,”Nothing comes to my desk unless I want it to come to my desk.”  Dear Mr. Governor, you are the governor, and like it or not you can’t always control what lands on your desk.  Check with your predecessors.

The State’s ownership and management of Sports & Entertainment venues historically has been rife with over-bloated salaries, perks for politicians, waste, and fraud.  The result: a run on the State treasury. The state should sell off its assets, get out of this business, and turn it over to private enterprise.

Only other delusional people could have believed in the success of Xanadu.  Beyond being the turnpike’s great eyesore, it had little to offer.  Yes, an indoor ski slope was an innovative idea, but most of the other projects – restaurants, shops, a movie theater –  are already available in many  malls without having to face the potential Meadowlands traffic congestion, turnpike toll fees, Xanadu parking fees, and long walks within the huge facility.  As a nearby resident I saw little in Xanadu that I could not find  find a few miles from where I live (or probably from where you live) – and without the headaches. (Naturally sunday football rituals at the stadium are not materially affected.)

The state could wait several years until the economy improves substantially and perhaps negotiate a strong financial deal for the Xanadu property, but in the meantime the existing structures would deteriorate while the state treasury struggles.  According to the Record,  real estate executive Steve Ross is in serious talks to take over Xanadu.  Such a deal, negotiated wisely by the state, could be a win-win.  The state would get revenue from the sale, and with some fresh rethinking from new ownership, Xanadu might yet become a success.

As a longtime NJ Nets fan, the plan of its real estate owner to move the team to Brooklyn has been so far an equally ill-conceived venture – fraught with delays, uncertainty and the Perils of Pauline. The results: the owner has starved the team of money and talent, reduced the fan base,  entered into a convoluted ownership arrangement with a wealthy Russian sports team owner whose plans are unclear, and as a final insult removed “NJ”, leaving only “NETS”, as the name for this team whose roots are long entwined in the history of NJ sports.

NJ fans want a NJ basketball team.  It belongs in Newark’s Prudential Center.  The IZOD Arena is an aging venue that inside resembles a larger version of your high school basketball arena, full of concrete blocks, few amenities, and ugliness.  It did serve a purpose and offered value to sports fans, but it no longer meets the needs of  a modern sports arena.  It would cost a huge sum to renovate – funds for which the State is in no position to borrow money.

If a private buyer for the IZOD Arena could be found, that would be great. Let the buyer refurbish it.  However, without at least one major sports team in the arena it probably is not financially viable. Prolonging its life as a state entity will only result in  ongoing deficits and in reduced income for both Prudential Center and IZOD Arena as they compete for entertainment attractions.

Our state has more pressing problems now.  It should get out of the S&E business, make as good a deal as it can over the Xanadu property, shed itself of the IZOD Arena, and encourage the NJ Nets to move to Newark.   The Governor, wearing his hat as S&E Czar, has tough decisions to make. They will land on his desk whether he wants them to or not.  But heck, isn’t that his job?

Quote of the Day: We were just about to do that

Here’s the story:

An appellate judge has thrown out a $4,000 bill submitted to the Sierra Club and Hartz Mountain Industries by the New Jersey Sports and Exposition Authority to pay for documents related to a lengthy legal battle by the groups.

The environmental group and the Secaucus-based developer had been asked to pay $1 per page for a 4,297-page appendix that the sports authority submitted to the court. The Sierra Club and Hartz had sued over the sports authority’s approval of filling in 8 acres of wetlands at the site of the Xanadu entertainment and retail project.

And here’s the money quote:

We were about to drop the request anyway,” sports authority spokesman John Samerjan said. “We thought it was the right thing to just let it go and move forward.”

Sure, exactly and if the court ruled in your favor, I have no doubt you were going to say “Your honor, we’ve thought about it and your decision wasn’t necessary because it’s not the right thing.”  

This bill is not to benefit the people who benefit from it…

Paul Sarlo has seen the light.  Apparently his recent brush with mortality has proven to him he should fight for what’s right:

A bipartisan bill sponsored by state Sens. Paul Sarlo of Wood-Ridge and Joseph Pennacchio of Morris Plains would exempt Xanadu and the Giants and Jets from paying a total of $90 million in fees designed to help towns provide affordable housing.

The bill, which was introduced Monday, would result in a savings of $50 million to Xanadu developers – and $40 million in combined savings for the football teams. Xanadu, a $2 billion entertainment and shopping complex, and the $1.6 billion Meadowlands football stadium would not be subject to a law passed in June that imposed a 2.5 percent fee on most non-residential construction projects.

But dont’ worry – the bill is really aimed at keeping East Rutherford from having to pay for new affordable housing.  Whew.  There for a minute, I thought someone was going to screw the poor or something.

Quote of the Day

Pepsi Ferris wheel at XanaduSenate President Dick Codey opines on the $100 million deal to put a giant Pepsi logo on a Ferris wheel at the Xanadu project:

“I expect the Ferris wheel to become a major tourist attraction, with visitors from throughout the world paying big bucks for the opportunity to ride 287 feet in the air to enjoy spectacular views of the roof of a shopping mall and a Pepsi Cola logo.  I think it’s wonderful that now we have the circus here year round.

“I accept the Pepsi Challenge.  Now we should see if Coke is willing to top that by putting a Coke bottle on top of the Statehouse dome so we can use the revenues to help us pay down our debt.  If Pepsi is willing to pay $100 million, I’m sure Coke would be willing to pay twice as much if it can be viewed from two different states.

Update: I took Jay’s photoshop challenge. Here’s my rendering of what Codey’s proposal could look like. I think it kind of works. Heck, I’d let them put a giant Coke bottle up there for even $100 million.

Trenton Statehouse and Giant Coke Bottle

Update 2: noodletalk shares his rendering in the comments. I think he wins:

Xanadu back on track?

According to northjersey.com, Mills Corporation has announced it has made a deal with Colony Capital Acquisitions , an investment bank, to provide funding for Xanadu:

Under the proposed deal, which is expected to close in late September, Mills would become a minority partner in the project and would invest an additional $90 million, with the understanding that it would have no further financial obligations after the deal closes. Mills has already spent nearly $485 million on the project.

Colony Capital Acquisitions would invest up to $500 million and arrange for a construction loan that will pay the balance of the project’s estimated $2 billion cost. Kan Am, an existing financing partner in the project, invested about $342 million and Mack-Cali Realty Corp. put in $32.5 million.

Mills, which has been facing a series of financial troubles, has agreed to issue 4.5 million shares of its stock, which would be allocated between Colony and Kan Am.