JERSEY CITY - A Kane In Your Corner investigation finds Jersey City officials may have a point when they complain that sweetheart deals made by the Port Authority of New York and New Jersey cost them hundreds of millions of dollars.
From Path Plaza to the Global Marine Terminal at Port Jersey, the Port Authority owns 32 parcels of Jersey City real estate. But the authority’s annual Payments in Lieu of Taxes, or PILOTs, have been unchanged in nearly 50 years thanks to an agreement dating back to 1967.
Nowhere is the impact of those deals more clear than at One Path Plaza, a 9.3-acre property in the heart of Journal Square. The property tax assessment today would be approximately $10 million, but the Port Authority still pays the 1967 rate of just $86,000. Over the decades, Jersey City officials say that single property has cost them $219 million in uncollected revenue.
In Port Jersey, the Port Authority’s annual PILOT payment is $1.3 million, as opposed to the current assessment of $1.6 million. The city says that property has cost them $9 million in uncollected revenue over the years. In some of its Jersey City properties, the Port Authority makes no annual payments at all.
“For the Port Authority to take the position that a payment in 1967 is acceptable in the year 2013 – that same dollar amount – is just, you know, I think anybody would say it’s really outlandish,” says Jersey City Mayor Steven Fulop.
The Port Authority certainly appears to have the money to pay a more current tax valuation. Last year, it cleared $1.5 billion in net operating revenue and it plans to raise tolls again later this month. The Port Authority also pays some of the highest salaries of any public sector employer. Five employees currently make more than a quarter of a million dollars a year, including Executive Director Patrick Foye and Deputy Director Bill Baroni, who each draw salaries of $289,667.
The Port Authority declined requests for an interview, but Chairman David Samson did make a brief statement to NJ Business Magazine. “We usually do not comment on threatened or pending litigation, but I can tell you the Port Authority is in compliance with its legal and contractual obligations,” Samson said.