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How Newark became a hotbed of cookie-cutter, multifamily housing
Monday, December 05, 2005
BY IAN T. SHEARN
Star-Ledger Staff Click here for story
In city's housing boom, a select few cash in
Newark's no-bid contracts, discounts and tax breaks mean fast, fat profits for some unlikely home developers
Sunday, December 04, 2005
BY IAN T. SHEARN
Star-Ledger Staff Click here for story
Faiella leaves politics, but not city development
By GEORGE E. JORDAN
Date:
2002/07/03 Wednesday
Page:
068
Section:
BUSINESS
Edition:
FINAL
Size:
412 words
STAR-LEDGER STAFF
Click
here for story
How Faiella Left Newark - Click here for story
Ready for some d'ja vu? -
Series: EMBEDDED AT CITY HALL | AN OCCASIONAL SERIES
Checkered flag for development
UNDER THE BIG TOP | THE REPORT FROM CITY HALL - Joan Whitlow
In
Newark, building plans roar past any roadblocks and race toward approval
Excerpt:
Marvin
Ginsberg builds carwashes and wants to put another on South Orange Avenue. He,
too, was shepherded by someone the council knows well, Alfred
Faiella, former deputy mayor and for three decades the point man on projects
to bring businesses and development to the city. He was also the head of the
Newark Economic Development Corp., a nonprofit agency. It folded its tent, but
Faiella took the name with him. I'm still looking for someone to explain to
me how this all happened.
Click
here for story
Note from Maureen Nevin: Back when Asbury Park invited the public to comment on the waterfront redevelopment agreement with Asbury Partners LLC, I tried to provide the council and public with the information contained in the following news reports, which I held in my arms at that time. However, Asbury Park's redevelopment attorney, James Aaron, silenced me, saying that the information about Mr. Faiella was not relevant to the agreement on the table.
Excerpts from earlier Star Ledger reports by George Jordan:
The Star Ledger called Alfred L. Faiella, currently representing Asbury Partners LLC, the most powerful development official in Newark for three decades.
Faiella also became deputy mayor - giving him dual titles -- and "the first and last word on all development projects." "For two decades, Alfred Faiella has been the man developers needed to see in Newark to get things done."
Last September (6/01) Faiella, who was pulling down a salary of $157,525, plus an annual pension contribution of $30,000 and a $2,000 expense account, was forced from that office by NEDC board members, including NEDC Chairman Edward Rytter, a vice president at Prudential Insurance Co. of America, and the president of the Newark Alliance, a corporate civic group closely aligned with philanthropist and businessman Raymond Chambers.
Since the 60's Faiella has held sway in Newark over tax abatements, the sale of city land, zoning approvals and tens of millions of dollars in federal grants. $2.4 million went into an industrial park to be privately owned by Faiella. See Donald Payne (D-10th Dist.) former Newark councilman. "outraged..."
Criticisms included:
Newark's land use master plan had not been updated in two decades
the city's zoning ordinances were last rewritten in the 1940's
As executive director of the Newark Economic Development Corp (NEDC), Faiella claims to have attracted some $5 billion to the state's largest city. But only produced 100 jobs, of the 300 he promised.
Read the reports here:
The Star-Ledger Archive
COPYRIGHT © The Star-Ledger 2002
Date: 2002/07/03 Wednesday Page: 068 Section: BUSINESS Edition: FINAL
Size: 412 words
Faiella leaves politics, but not city development
By GEORGE E. JORDAN
STAR-LEDGER STAFF
Alfred Faiella yesterday ended his
three-decade reign as Newark's most
powerful development
official to pursue work as a consultant and lawyer.
The first step toward Faiella's exit from public life came when Newark Mayor
Sharpe James
did not reappoint him as deputy mayor for
economic development and housing.
James has
nominated an official from the Washington, D.C.-based Congress of National
Black Churches
to replace Faiella.
As deputy mayor and director of the now-defunct
Newark Economic Development
Corp., Faiella
had the first and last word on all development
projects. He personally
brokered big deals
as architect of the city's policy of doling out land, cash and tax breaks
that fueled
downtown office construction during the 1970s and 1980s.
Faiella, a noted political fund-raiser, could not be reached for comment.
Despite his departure from City Hall, Faiella remains a major player in
Newark development.
He serves as president of a series of nonprofit and private for-profit
corporations he
created at NEDC that own two huge downtown parking garages worth $21.1
million and a $9
million warehouse in the South Ward.
The entities also own valuable land near Newark International Airport, the
Passaic River
waterfront downtown and the proposed arena site across from Penn Station,
according to
state and city records.
Earlier this year, Faiella said he was weighing offers from major law firms
and considering
working as a private consultant.
Faiella's most important contribution to Newark development was his role in
a half-dozen
high-rise glass and steel towers, mostly around Newark Penn Station.
But Faiella also was criticized for his
inattention to planning in the
surrounding city
neighborhoods.
James could not be reached for comment and his press secretary, Pamela
Goldstein, did not
respond to telephone messages left at her office.
James has nominated Niathan Allen, the Congress of National Black Churches'
program
director, to serve as deputy mayor for economic development and housing,
overseeing
development, land use and housing policy.
This week, the Newark City Council tabled Allen's nomination, but is
expected to confirm
his appointment next week.
____________________________________________________________________________
_________________
George E. Jordan can be reached at gjordan@starledger.com or (973) 392-1801.
URL:
Faiella leaves
politics, but not city development
Date: 2002/02/22 Friday Page: 034 Section: BUSINESS Edition: FINAL
Size: 526 words
Newark development agency to close
City Hall will take over some functions
By GEORGE E. JORDAN
STAR-LEDGER STAFF
The Newark Economic Development Corp. said yesterday it would fire its staff
and shut it
doors next month.
The shutdown of NEDC marks an end to an agency widely credited with keeping
the city's
economy afloat in the aftermath of the 1967 riots.
It also leaves Newark, for now, with no one to promote the city and help
companies relocate
as city boosters push to finalize funding for the proposed Newark arena.
NEDC Chairman Edward Rytter, a vice president at Prudential Insurance Co. of
America, said
the agency, insolvent after Newark cut off its funding late last year, would
send out
layoff notices next week. The staff was informed Friday.
"There's is no question; people will be getting notices of when we will be
shutting down
and when they will be going off the payroll," Rytter said. "It's a little
unfortunate."
NEDC's staff, whose tenure at the agency rages from five years to as many as
18 years, have
been offered severance packages that include pay for accrued vacation time
and about $2,000
per year of service.
Newark's proposed budget includes money to add some NEDC workers to the
city's payroll.
Newark Mayor Sharpe James, who is seeking re-election to a fifth term, has
declined comment
on NEDC. He told corporate leaders this month Newark City Hall would take
over some of its
key functions, such as public relations campaigns promoting the city.
James told a Regional Business Partnership breakfast that NEDC or a new
group that replaces
it must raise its own funding. "NEDC is going to have to stand on its own
two feet," the
mayor said.
Central Ward Councilman Cory Booker, who faces off against James in the
Democratic primary
in May, said the collapse of NEDC "exposes a tragically missed opportunity
to empower
communities in the city." He said local residents should have had more say
over the years
in its activities.
Rytter said a group of civic leaders may create a development company to
replace NEDC,
which has taken credit for luring $5 million in investment to the city,
mostly in the form
of office buildings and parking garages around Newark Penn Station.
NEDC was formed in 1964 as a one-stop service point for businesses looking
to relocate or
expand in Newark. It later administered federal Urban Development Action
Grants and the
state Urban Enterprise Zone.
The Newark City Council voted in September to have the James administration
stop payment of
the agency's $1.6 million in annual contracts and seize $4.3 million of city
funds in the
NEDC's accounts.
The vote was taken the same day the longtime former executive director,
Alfred Faiella, was
forced to step down by a board of directors dominated by corporate
chieftains and
philanthropists opposed to his development policies.
Faiella, who serves as the city's deputy major for economic development and
housing, has
declined comment on NEDC's demise.
____________________________________________________________________________
_________________
George E. Jordan can be reached at gjordan@starledger.com or (973) 392-1801.
URL:
Newark
development agency to close
Date: 2002/02/01 Friday Page: 051 Section: BUSINESS Edition: FINAL
Size: 678 words
Development agency loses Newark aid
By GEORGE E. JORDAN
STAR-LEDGER STAFF
Newark Mayor Sharpe James said yesterday the city would no longer fund the
Newark Economic
Development Corp., the agency charged for nearly four decades with luring
private
investment to New Jersey's largest city.
The mayor told a breakfast meeting of the Regional Business Partnership the
nonprofit
development agency must "stand on its own two feet."
No funding for the corporation leaves Newark with no one to promote the city
as a place to
business, help companies looking to relocate or administer its state Urban
Enterprise Zone.
Lawrence Goldman, president and chief executive of the New Jersey Performing
Arts Center,
said killing the corporation was a bad idea. Prominent nonprofit development
agencies were
an essential ingredient in celebrated comeback cities such as Cleveland,
Baltimore, Chicago
and Pittsburgh, he said.
Groups such as the Newark Economic Development Corporation "create the
necessary bridge
between government and business. I believe that's a successful model," he
said.
The NEDC, founded in 1964, had contracts with the city to provide a one-stop
service point
for businesses looking to relocate or expand in Newark. It takes credit for
luring $5
billion in investment to the city.
The agency, though, has teetered on the verge of insolvency since autumn,
when Newark's
City Council recommended the James administration stop payment of the
agency's $1.6 million
in annual contracts and seized $4.3 million of city funds in the NEDC's
accounts.
Newark cut off funding the same
day in September the long-time former
executive director,
Alfred Faiella, was forced to step down by a board of directors dominated by
corporate
chieftains and philanthropists opposed to his development policies.
Faiella, a major James political backer and the city's most powerful
development official
for three decades, continues to serve as deputy mayor for economic
development and housing.
"It is still functioning," James, who is seeking election to a fifth term in
May, said of
the NEDC. "It will function even better as a completely independent agency
receiving no
municipal dollars."
Edward Rytter, NEDC's chairman and a vice president at Prudential Insurance
Co. of America,
could not be reached for comment.
Faiella retains control over a series of
nonprofit and private for-profit
corporations he
created at NEDC, with assets of at least $35 million. They include two
downtown parking
garages, the
South
Ward Industrial Park and an interest in Two Gateway
Center.
Faiella yesterday did not return telephone calls seeking comment.
He has insisted the enterprises have "nothing to do" with NEDC. But for
years, the entities
were the agency's lone source of operating revenue.
In the past, profits from the entities were transferred to city coffers,
according to their
federal income tax returns. Newark then used the money to fund NEDC's annual
contracts to
assist businesses and administer the Urban Enterprise Zone and two federal
and state grant
programs.
John Petillo, an NEDC board member, said the organization could probably
survive
independent of the city, but in the future its ventures should be modeled
after the New
Brunswick Development Corp. Known as Devco, the group has spurred $1.5
billion of
development, including construction of 1.7 million square feet of office
space.
"It's not defined by a person. It's Devco, not the person," said Petillo in
a criticism of
Faiella's claim of control over NEDC-related ventures. "It's an
institutional tie-in, not a
personal tie-in."
Under Faiella, NEDC became involved in
everything from land-use planning to
zoning
functions. Faiella also was allowed to operate his law practice, a
development company and
a consulting business out of the nonprofit's offices.
The agency has offices in the Legal and Communication Center next to Newark
Penn Station.
If NEDC folds, its half-dozen staff members may
face unemployment.
TAG: 2002-3c5acfdd9
URL:
Development
agency loses Newark aid
Date: 2001/12/07 Friday Page: 031 Section: BUSINESS Edition: FINAL
Size: 650 words
Newark agency's future is bleak
Chairman says NEDC has 'month or two' left
By GEORGE E. JORDAN
STAR-LEDGER STAFF
The Newark Economic Development Corp., the agency that for 37 years lured
private
investment to New Jersey's largest city, is on the verge of going belly up,
according to
its chairman.
NEDC is a month from folding after the Newark City Council froze payment of
its $1.6
million contract and seized $4.3 million of city funds in NEDC's accounts
over the past two
months.
"We don't have a lot of time," said NEDC Chairman Edward Rytter, a vice
president at
Prudential Insurance Co. of America. "We have a month or two. Beyond that,
we have to
obviously consider shutting down."
The NEDC was formed in 1964 as a one-stop service point for businesses
looking to relocate
or expand in Newark. The nonprofit eventually became involved in everything
from land-use
planning to zoning functions, and has taken credit for luring $5 billion in
investments to
the city.
The corporation, which also oversees the Urban Enterprise Zone in Newark,
was funded under
two one-year contracts that pay a total of $1.6 million annually to lure
business.
The city was scheduled to pay NEDC the first of two six-month installments
this month, but
the council voted unanimously in September to withhold the money. The vote
was taken the
same day corporate chieftains and philanthropists who wield considerable
behind-the-scenes
clout forced out the agency's former director, Alfred Faiella.
The city's civic boosters said they opposed Faiella's policies toward
neighborhood
development and land-use planning. Newark City Councilwoman Gale
Chaneyfield-Jenkins, who
sponsored a resolution freezing city payments to NEDC, has said she took
offense at
attempts by corporate interests and non-residents to wield so much
influence.
Chaneyfield-Jenkins and other council members were not available for comment
yesterday.
Newark Mayor Sharpe James, who plans to seek a fifth term in May, declined
comment though
his spokeswoman, Pamela Goldstein. She directed questions to Faiella, who is
deputy mayor
for economic development and housing.
"No comment," Faiella said. "I'm not going to touch that."
Councilman-at-large Donald Tucker, who is overseeing a council subcommittee
investigation
of NEDC, said the council would redirect NEDC's funding to bolstering the
city's one-member
planning department.
"I just think (NEDC) is going to have a role that is radically different
than what it has
had," Tucker said.
That, Tucker said, means "less money."
Faiella's departure from NEDC touched off controversy because he continues
to serve as
president of a dozen nonprofits and private for-profit corporations he
created at NEDC.
With only $500,000 on hand, NEDC this week was forced to suspend a contract
to produce
brochures and other materials promoting the city. NEDC has a staff of a half
dozen
full-time workers. If NEDC folds, its staff may face unemployment.
If the council redirects NEDC's funding to the city planning department,
Faiella in his
role as deputy mayor would oversee city planning. That would again place him
in charge of
almost all of the city's development, the type of broad-ranging power
Newark's civic
boosters oppose.
Dennis Gale, director of Rutgers University's Joseph C. Cornwall Center for
Metropolitan
Studies, said Newark could use NEDC's demise as an opportunity to join "the
mainstream of
American cities" by hiring a professional planning staff.
Gale also said making Faiella the ultimate development decision-maker was a
bad idea
because of the potential conflicts in his multiple roles.
"You need fresh leadership," he said. "Whatever they do, they need fresh
leadership."
____________________________________________________________________________
_________________
Staff Writer Nikita Stewart con tributed to this report.
URL:
Newark
agency's future is bleak
Date: 2001/10/10 Wednesday Page: 021 Section: BUSINESS Edition: FINAL
Size: 716 words
Newark stalling massive rehab of downtown
$160 million project in jeopardy
By GEORGE E. JORDAN
STAR-LEDGER STAFF
A deal to turn the vacant Hahne & Co. building into luxury apartments, a
critical part of
efforts to revitalize Newark's downtown, is on the brink of falling apart,
city officials
said yesterday.
The city council's delay in granting preliminary approvals has the
Philadelphia-based
developer threatening to withdraw its commitment to spend $160 million on
the former
department store, city officials said.
"They could walk," said Deputy Mayor Alfred Faiella, who oversees
development and housing
policy. "We should get this moving now."
The timing of the setback is critical. The World Trade Center disaster, a
slumping economy
and military action in the Middle East already have developers rethinking
projects big and
small. Financing is in jeopardy for the proposed Newark arena, and no one
can say how the
city plans to pay for an elaborate park planned along the Passaic River,
where construction
of an office building for the FBI is under way.
For the past month, the nine-member council has refused to vote on a
resolution that starts
the process of condemning a few vacant lots on the fringe of the
three-square-block area
south of the Hahne's building. The site is located on Broad Street, across
Military Park
from the New Jersey Performing Arts Center.
Parkside Associates, a partnership of three Philadelphia-based developers,
plans a
mixed-use development of 549 one- and two-bedroom apartments, augmented with
restaurants,
shops, nightclubs and a health club.
The deal would be financed by the developers, requiring no public land or
cash.
A lone councilwoman, Gale Chaneyfield-Jenkins, has put the brakes on the
project. In two
meetings over the past month with officials from Parkside, she has demanded
extensive
financial information from Parkside and questioned its plan to apply for
property tax
breaks.
In the past, Chaneyfield-Jenkins had championed tax abatements and other
subisidies to
encourage development. Yesterday, she declined comment through an aide,
Yvette Abdullah.
The Newark Alliance, a civic group comprised of corporate executives,
yesterday released a
statement that called Hahne's "the most exciting private development project
of its kind in
the city's history" and urged the city to give "fast track consideration."
Parkside Associates was selected by the New Newark Foundation, an
organization dedicated to
hastening downtown development. Funded by Prudential Insurance Co. of
America and
philanthropist Raymond Chambers, the foundation owns $25 million in prime
downtown real
estate.
Parkside is a partnership of Kravco Co., a major developer of malls and
mixed-use
developments; Dranoff Properties, a developer that specializes in recycling
historic
buildings; and Universal Cos., which specializes in job training and
minority
entrepreneurship.
Developer Carl Dranoff and Kravco Chairman Lewis Gantman did not respond to
telephone
messages.
Tropicana Casino and Resort, which is in discussions to spend upward of $20
million to
build shops and restaurants in the Hahne building, remains committed to New
Jersey's
largest city, said Dennis Gomes, president of Resort Operations for the
Aztar Corp.,
Tropicana's parent company.
"We're looking to do something up there, and this is a deal we absolutely
love," Gomes
said. "The building is a beautiful building, and we think this project has
tremendous
potential."
Tropicana executives worked closely with Sen. Bill Gormley (R-Atlantic) in
creating
legislation to give casinos tax credits in return for investing in urban
areas outside of
Atlantic City. Tropicana's plan to build a $225 million expansion to its
Atlantic City
casino, in return for $50 million in tax credits and a pledge to invest up
to $20 million
into the Hahne project, has already been approved by the Casino Reinvestment
Development
Authority.
"We're hoping that everything works out so this can go forward," Gomes said.
"If for some
reason it (Hahne's) falls through, we'd look for another viable project."
____________________________________________________________________________
_________________
Staff Writers Judy DeHaven and Nikita Stewart contributed to this re port.
GRAPHIC INFO LIST:
Hahne & Co., 609 Broad St.
Built: 1901
Size: Four stories, 311,700 square feet
In its heyday, the building was a place where Newark's wealthiest families
arrived in
hansome carriages to shop. It had a towering atrium - 108 feet high -
spanned by a bridge
at each floor. During World War II, the skylight was painted black and the
openings between
floors were closed. Like the fortunes of Newark itself, the store went into
a slow decline,
until it closed in 1991.
TAG: 2001-3bc47469b
URL:
Newark stalling
massive rehab of downtown
Date: 2001/09/06 Thursday Page: 024 Section: ESSEX Edition: WEST Size:
578 words
Newark City Council wants audit of development agency
By GEORGE E. JORDAN
STAR-LEDGER STAFF
The Newark City Council last night opened an inquiry into the finances of
its nonprofit
development agency, which is embroiled in a dispute over control of $35
million in assets.
The nine-member council voted unanimously to audit Newark Economic
Development Corp., which
contracts with the city to help businesses move to Newark or expand
operations. At the same
time, the council held up approval of the NEDC's $562,000 budget to manage
the city's urban
enterprise zone.
Also yesterday, Alfred Faiella, the NEDC's executive director, resigned in a
closed-door
meeting with the organization's board of directors. He has been the NEDC's
chief for nearly
three decades.
"Al submitted his resignation. We accepted it with regret, recognizing his
long service and
contribution to the city," said Ed Rytter, NEDC's chairman and a vice
president at
Prudential Insurance Co. of America.
Faiella was replaced temporarily by Christopher Paladino, president of the
New Brunswick
Development Corp. Known as Devco, the group has been celebrated for its work
in downtown
New Brunswick.
Rytter said Paladino would "provide strategic advice and transition
services" for the next
six months, when the NEDC would hire a new executive director.
Faiella is being ousted under pressure from an influential group of
corporate chiefs and
philanthropists who are opposed to his policies on development and land use
planning. Since
the late 1960s, Faiella has been the most powerful economic player in
Newark, holding sway
over tax abatements, the sale of city land, zoning approvals and tens of
millions of
dollars in federal grants.
Faiella could not be reached for comment yesterday.
In an unusual arrangement, Faiella was also Newark's deputy mayor for
economic development
and housing, a post he has held for two years. Faiella has said he would
continue as deputy
mayor.
Pamela Goldstein, spokeswoman for Mayor Sharpe James, did not respond to
inquiries about
Faiella's status or his salary. As deputy mayor, he previously earned $1 a
year and had use
of a city car and driver.
The NEDC paid the bulk of his salary. Faiella earned $157,525 as NEDC's
executive director.
His contract also provides for a $30,000 annual pension contribution and a
$2,000 monthly
expense account.
Faiella's resignation from the NEDC did not resolve a bitter dispute over
control of 12
nonprofit and private for-profit corporations he created. Faiella said last
week he plans
to remain president of the entities, some of which carry NEDC in their
names.
The corporations own and operate two huge downtown parking garages worth
$21.1 million, a
$9 million warehouse in the South Ward, and a $3 million stake in two of the
four Gateway
office buildings, according to state and city records.
The officers of the corporations are Faiella, Robert Kroner and William
Eaton, the
corporate charters show. Faiella is president of each and the other two,
both lawyers, are
trustees, the records show.
Rytter referred questions about the NEDC-related affiliates to Goldstein.
"The question
about the affiliates - that is a question the city is working on," he said.
Councilman-at-Large Donald Tucker said the NEDC has filed no annual audits
with the city
since 1993. He said the council never asked for the records in the past
because it assumed
the NEDC was a "municipal entity."
URL:
Newark City
Council wants audit of development agency
Date: 2001/09/05 Wednesday Page: 013 Section: NEW JERSEY Edition: FINAL
Size: 864 words
Economic development chief steps down
Corporate leaders and philanthropists are unhappy with Newark official's
policies
By GEORGE E. JORDAN
STAR-LEDGER STAFF
After two decades of false starts, Newark City Hall moved to do what private
developers had
failed to do: build a manufacturing center to provide badly needed jobs in a
barren South
Ward neighborhood.
Alfred Faiella, executive director of the Newark Economic Development Corp.,
was put in
charge, and $11 million in federal and state grants were poured in to the
facility, along
with $1.7 million in city funds. Faiella vowed some 300 jobs would be
created at the South
Ward Industrial Park.
Today, however, only 100 people work in a warehouse there, and the facility
at Hawthorne
Avenue and Bergen Street is one of a half-dozen such developments at the
center of a
dispute between Faiella and the NEDC. Faiella, who has headed the NEDC for
three decades,
steps down today under pressure from a relatively new board of trustees. The
board is
expected to name someone to replace Faiella today.
But it is the ongoing disagreement about projects such as the South Ward
Industrial Park
that has captured the board and City Hall's attention.
While the NEDC built the industrial park, it did so by creating a private,
for-profit
corporation. The officers of the corporation are Faiella and two of his
associates,
according to state and city records.
Faiella said last week that he would continue to be president of that
corporation and a
series of other nonprofit and for-profit entities set up in the same way to
encourage
development. There are 12 in all with assets of $35 million.
The South Ward Industrial park "secured federal grants with NEDC's and the
city's
assistance," Faiella said, in explaining his stance. "It never used NEDC
money. It used
federal and state grants."
None of that sat well with Rep. Donald Payne (D-10th Dist.), a former Newark
councilman who
helped free up $2.4 million in federal grants for the industrial park. He
said he was
outraged that the industrial park provided so few jobs, adding: "On top of
that, to be
privately owned by the NEDC's executive director is absolutely shocking and
really a misuse
of money."
NEDC contracts with the city to assist businesses looking to relocate or
expand in Newark.
It also administers the state urban enterprise zone and a federal grant
program.
Faiella's long tenure at the NEDC is coming to a close because an
influential group of
corporate chiefs and philanthropists is not happy with his development and
land use
planning policies.
In an unusual arrangement, Faiella for the past two years also has served as
deputy mayor
for economic development and housing. He will continue in that post.
Yesterday, Mayor Sharpe James put some distance between himself and Faiella.
James said the various entities at the heart of the dispute were set up over
the years as
independent nonprofit organizations and profit-making ventures controlled by
Faiella
without Newark's knowledge.
"These matters are being investigated by the (NEDC) board. None of this
occurred with the
knowledge of the city," the mayor said. "This was brought to their (the
board's) attention
by us."
NEDC's chairman, Edward Rytter, a vice president at Prudential Insurance Co.
of America,
said the board would meet today to name Faiella's successor, although it
wasn't clear
whether the post would be filled temporarily or permanently. The NEDC is
governed by a
19-member board of trustees appointed by James and the Regional Business
Partnership, which
promotes public-private partnerships.
Faiella earned $157,525 as the NEDC's executive director. His contract also
provides for a
$30,000 annual pension contribution and a $2,000 monthly expense account.
As deputy mayor he earned $1 annually and had the use of a city car and
driver. His city
salary is now under review.
He also was allowed to operate a law practice, a development company and a
consulting
business out of the NEDC office, firms that specialized in assisting large,
commercial and
industrial projects, some in northern New Jersey.
Mayor James' spokeswoman, Pamela Goldstein, said yesterday that said
Faiella's new
compensation as deputy mayor was not set. "Mr. Faiella's proposed salary . .
. is unknown
at this time," she said in a written statement.
Last week, Faiella boxed up the NEDC-related corporations' financial records
at the NEDC's
office in the Legal Communications Building and told co-workers of his plans
to move the
operations into another suite in the same building.
Faiella has declined to release the federal tax returns of five for-profit
corporations he
created as executive director - three associated with the South Ward
Industrial Park; Three
Gateway Garage Corp., owner of a parking deck that was sold last year for
$7.2 million, and
the NEDC Waverly Corp., which helped develop a hotel and plan a convention
center near
Newark International Airport.
____________________________________________________________________________
_________________
George E. Jordan covers Jersey real estate. He may be reached at (973)
392-1801 or
gjordan@starled ger.com
PHOTO CAPTION: 1. Alfred Faiella will continue as deputy mayor for economic
development and
housing. CREDIT: 1. ROBERT SCIARRINO/THE STAR-LEDGER
TAG: 2001-3b964fc13
URL:
Economic
development chief steps down
Date: 2001/09/02 Sunday Page: 019 Section: NEW JERSEY Edition: FINAL
Size: 1414 words
Board members drive Newark development guru from office
Faiella loses executive directorship amid disagreements on policy
By GEORGE E. JORDAN
STAR-LEDGER STAFF
For three decades, Alfred Faiella has been the most powerful development
official in Newark
- arranging federal grants, loans, tax breaks and making available
city-owned land and
fast-tracking zoning approvals.
During his tenure, he says, $5 billion has been invested in New Jersey's
largest city.
This week Faiella, 50, will step down as executive director of the Newark
Economic
Development Corp. amid a bitter dispute over control of a series of
nonprofit and private
for-profit corporations he created with assets of at least $35 million.
Faiella said last week he plans to remain president of the entities, some of
them carrying
NEDC in their nam9es. He also plans to continue as Newark's deputy mayor for
economic
development and housing, a post he has occupied for two years in addition to
NEDC's
executive directorship.
"These entities are not part of NEDC," Faiella said of the corporations.
"These are
separate and apart from NEDC and the city. If I discontinue my work at NEDC,
it has nothing
to do with my work with the city."
Faiella is being ousted under pressure from an influential group of
corporate chieftains
and philanthropists who wield considerable behind-the-scenes clout in
Newark. They oppose
his policies toward development and land use planning.
NEDC's chairman, Edward Rytter, a vice president at Prudential Insurance Co.
of America,
said he met with Faiella last week and proposed that NEDC manage the
corporations after
Faiella's departure. He said NEDC's board meets Wednesday to name Faiella's
successor.
Faiella's NEDC resignation was engineered by Rytter and John Petillo, an
NEDC board member
and president of the Newark Alliance, a corporate civic group closely
aligned with
philanthropist and businessman Raymond Chambers.
They opposed construction of an FBI headquarters championed by Faiella along
the Passaic
River across from the New Jersey Performing Arts Center, where the city
boosters favored a
waterfront park. They also have criticized Faiella's indifference toward
land use planning.
Newark's comprehensive Land Use Master plan has not been updated in two
decades and the
city's zoning ordinances were last rewritten in the 1940s.
They said it was unclear if Faiella would agree to relinquish control
without a fight.
"This is unfair to the city," Petillo declared. "He's had his day. He should
just go on his
way."
NEDC, founded in 1964, contracts with the city to provide a one-stop service
point for
businesses looking to relocate or expand in Newark.
It also administers the state Urban Enterprize Zone and a federal grant
program.
As NEDC executive director, Faiella founded a dozen corporations that today
own and operate
two huge downtown parking garages worth $21.1 million, a $9 million
warehouse in the South
Ward and a $3 million stake in two of the four Gateway office buildings,
according to state
and city records.
The lone officers of the entities are Faiella, Robert Kroner and William
Eaton, their
corporate charters show. Faiella is president of each and the other two,
both lawyers, are
trustees, the records show.
Although Faiella claims "they (the entities) have nothing to do" with NEDC
or Newark City
Hall, Faiella was instrumental in obtaining city hall approval involving
city-owned land,
property tax breaks or state and federal Urban Development Action Grants.
The South Ward
Industrial Park, owned by three profit-making entities founded by Faiella,
was financed
entirely with public money, state and city records show.
"He was representing the City of Newark. No way Al can now say the city has
no interest,"
said Councilman-at-large Donald Tucker, chairman of the council's tax
abatement committee.
"It isn't that he went out and got private industry to invest. None of this
would have
happened without the investment of the city."
Faiella earned $157,525 as NEDC's executive director. His contract also
provides for a
$30,000 annual pension contribution and a $2,000 monthly expense account.
He also was allowed to operate a law practice, a development company and a
consulting
business out of the NEDC office, firms that specialized in assisting large,
commercial and
industrial projects, some in northern New Jersey.
In an unusual arrangement two years ago, Newark Mayor Sharpe James appointed
Faiella deputy
mayor and moved him into city hall. NEDC paid the bulk of his salary, while
Newark
taxpayers paid Faiella $1 yearly as deputy mayor. He also was assigned a
city car and
driver.
But the dual titles - NEDC executive director and deputy mayor for
development - gave
Faiella the first and last word on all development projects. Faiella has
acknowledged that
his multiple titles created potential conflicts of interest.
Faiella said last week that he was in negotiations with city hall and the
NEDC-related
corporation over what his compensation will be in the future.
And in any case, Faiella does not plan to have a diminished influence when
he leaves his
post at NEDC.
Last week, Faiella boxed up the NEDC-related corporations' financial records
at NEDC's
office in the Legal Communications Building and told co-workers of his plans
to move
management of the South Ward Industrial Park and Legal Communications Center
and Bank
Street parking garages into another suite in the same office building.
The arrangement would be unusual. Community development corporations around
New Jersey and
the nation routinely create affiliates to limit their insurance liability
and occasionally
go into partnership with for-profit entities. But control of the entities
does not remain
with a departed executive director.
For instance, Miami Beach Community Development Corp., one of the largest
and most
successful in the nation, has 20 affiliate corporations, all of them
nonprofit. The
presidency of each of them was transferred to a new executive director two
years ago when
his predecessor resigned, explained Roberto Datorre, the Miami Beach group's
chairman.
"No way that would happen here. It doesn't belong to him, for God's sake, it
belongs to the
organization," Datorre said of Faiella's plan to remain as president of the
affiliates. "He
doesn't want to let go. He feels he's been there, he has done everything,
but that's tough.
That's the way it is."
The dispute has put Faiella on a collision course with Mayor James, who has
depended on
Faiella to broker the city's biggest development deals, such as construction
of the Gateway
complex, Seton Hall Law School and two dozen neighborhood shopping centers.
The projects, worth tens of millions of dollars, helped keep Newark afloat
when businesses
and families were turning their backs on the city. They formed the
cornerstones of the
city's attempted economic turnaround.
In the past, Faiella has also served as James' chief political campaign
fund-raiser.
James, running for a fifth term next year, has declined comment.
"This exposes a tragically missed opportunity," said Central Ward Councilman
Cory Booker, a
potential challenger to James for mayor. "The city should be about creating
wealth for its
residents, but it is obvious the agenda was different. They used government
funds and grant
dollars to empower private entities of which none had local participation or
control."
NEDC is governed by a 19-member board of trustees. Six city officials sit ex
officio on the
board. James and the Regional Business Partnership, which promotes
public-private
partnerships, jointly name six additional trustees. The Regional Partnership
fills the
remaining seats.
Faiella, who has an engineering degree from NJIT and a law degree from Seton
Hall Law
School, began his career with the city property division under former Mayor
Kenneth Gibson.
He has evolved into one of the most powerful economic players in Newark.
Dennis Gale, director of Rutgers University's Joseph C. Cornwall Center for
Metropolitan
Studies, said the dispute highlights the inherited conflicts in Faiella's
multiple roles.
"What it is, is one guy trying to maintain control over a tremendous amount
of the city's
business and not handing out, allocating, distributing, power to other
people," Gale said.
"It's all under one guy's thumb. He's trying to hold onto some of his
goodies."
NOTES: George E. Jordan covers real estate. He can be reached at (973)
392-1801 or
gjordan@starledger.com.
URL:
Board members
drive Newark development guru from office
Date: 2001/08/03 Friday Page: 033 Section: BUSINESS Edition: FINAL
Size: 574 words
Point man for Newark development may leave
By GEORGE E. JORDAN
STAR-LEDGER STAFF
For two decades, Alfred Faiella has been the man developers needed to see in
Newark to get
things done.
Now, he could be out as executive director of the nonprofit Newark Economic
Development
Corp., the city's primary commercial development agency, according to six
people in
government and private industry who are familiar with the situation. Faiella
said he will
remain as deputy mayor for economic development and housing until at least
the May
election, when Mayor Sharpe James runs for a fifth term.
When asked if he would be leaving NEDC before then, he said he couldn't
comment. But he
acknowledged he has received job offers.
"The last offer I got from a law firm was good," Faiella, an attorney and
private
developer, said. "I made a commitment to my mayor for his term, at the very
least. From
time to time, I've had job offers, but lately - you know, real estate is
real heavy right
now - but I've got a job to do." Newark Alliance Chief John Petillo and
Newark Business
Administrator Harold Lucas are conducting an informal search for a successor
at NEDC,
according to the people familiar with workings of the agency.
Neither Lucas nor Petillo, who is a member of NEDC's board, responded to
telephone messages
left at their offices and with their spokesmen seeking comment.
James denied changes were brewing at NEDC.
"I have no knowledge of that," the mayor said. "There is no change at NEDC.
Nothing has
happened to my knowledge."
As executive director of NEDC and deputy mayor, Faiella wielded almost
exclusive authority
over major - as well as many not-so-major - commercial and residential
projects in the
state's largest city. NEDC claims responsibility for attracting an estimated
$2.6 billion
in investment in the city since 1985.
During the past two years, however, Faiella's policies have been criticized
by some
developers and other business executives because of the absence of
comprehensive master
planning of development.
A group including engineer Lza Thornton-Tomasetti, Urs Gauschat, dean of
Rutgers
University's school of architecture, and members of the architectural firm
the Hillier
Group have criticized the poor quality of many homes popping up in city
neighborhoods.
Faiella has defended himself against critics of the city's planning efforts.
"We're doing it on a block-by-block basis," he said in a recent interview.
"All you have to
do is look at the results. I think the criticism is a little unfair."
The NEDC, formed in 1964, was meant to be a one-stop service point for
businesses looking
to relocate or expand in Newark. But unlike its counterparts elsewhere
around the country,
NEDC became involved in everything from land-use planning to zoning
functions.
Faiella, 50, has an engineering degree from the New Jersey Institute of
Technology and a
law degree from Seton Hall.
"He was the lightning rod for development in the city for a long time,"
former Mayor
Kenneth Gibson said. "It wasn't so much everyone had to go through him than
he had the
ability and authority to get things done."
Two years ago, James named Faiella deputy mayor and moved his office into
City Hall.
____________________________________________________________________________
_________________
George E. Jordan can be reached at gjordan@starledger.com or (973) 392-1801.
PHOTO CAPTION: FAIELLA
TAG: 2001-3b6acf389
URL:
Point man for
Newark development may leave
Date: 2001/05/06 Sunday Page: 045 Section: ESSEX Edition: 9 Size:
995 words
The people begin to clamor for a new Newark
Campaign encourages discussion of the city's policies
By GEORGE E. JORDAN
STAR-LEDGER STAFF
AT ISSUE Restaurant owner Feldon Middleton was fuming.
As 40 of his neighbors in Newark's Weequahic Park section bemoaned the lack
of a clear path
to influence their city's future, Middleton rose from his seat to silence
the crowd.
"We have to take control of our community. Set your own agenda, seek the
resources and do
what needs to be done," he said, raising his voice for emphasis. "Until you
do that,
nothing is going to happen. You can't just go to meetings and make a lot of
noise. You have
to do something."
The scene in a community building in Weequahic on Thursday night -
stakeholders pondering
problems and ways to fix them - has been playing out with increasing
frequency across a
broad cross section of New Jersey's largest city.
Newark's growing cachet is giving birth to a new sense of civic activism
among the
businesses moving downtown, developers snapping up properties around the
city and
first-time home buyers moving into every neighborhood, academic and city
leaders said. Even
discouraged veteran activists said they were motivated to re-enter the fray.
As Middleton went to his seat amid applause, a grin formed across the room
on the face of
Richard Roper, a public policy expert. He organized the meeting in
Weequahic, and plans
others like it around the city this month to encourage dissent against the
status quo.
"I want citizens to feel they can influence public policy-making in the
city," he said. "I
think there is a realization there needs to be more attention paid by all
segments of the
Newark metropolitan area to what is happening in the city and how it
happens."
Roper, director of the 21st Century Task Force, a group of 22 academics,
corporate
executives, philanthropists and educators who have ties to Newark, is
circulating a new
report about Newark's future. The 55-page booklet contains general findings:
Newark must
fix its schools and its image, as well as create jobs for low-skilled
workers and
opportunities for existing small businesses.
But Roper said the point of the campaign was to encourage public discussion
of the full
spectrum of city policies by Newarkers of every stripe. All the better, he
said, if they
criticize the city's decision-makers - a cardinal sin in Newark's insular
political culture
- and act to force change.
"What is going on is a series of major events in the city seem to be
converging into the
notion that it is time to rethink the direction of the city," said Dennis
Gale, director of
Rutgers University's Joseph C. Cornwall Center for Metropolitan Studies.
"People are taking
a fresh look at Newark. The old ways are not going to work."
The new voices rising up around the city this year run the gamut from
corporate chieftains
questioning land-use policies to neighborhood activists hounding officials
about parks and
public spaces to youth groups decrying summer recreation programs and
small-business owners
and entrepreneurs demanding a role in the renaissance.
Frank Hutchins, director of the HUD Tenant Coalition and a longtime South
Ward activist,
said the basic concerns - schools, city services, jobs and tattered
neighborhood commercial
corridors - were the same as in years past. But, he said, the number of
groups making noise
could change Newark's political calculus.
"There were so few of us before, we were like crying in the wilderness," he
said. " Now
there are a number of people that have voices or opinions. I don't know if
it's new people
coming in or people who have suddenly arisen like the Phoenix."
Mayor Sharpe James, who has announced he would seek a fifth term next year,
acknowledged
elected leaders cannot ignore the growing numbers of influential, and not so
influential,
players.
"I always have believed that government does not have all the answers and
that more
progress is made when people affected by governmental decisions become part
of the
decision-making process," James said in a written statement.
Alfred Faiella, Newark's deputy mayor for economic development and housing,
said before a
breakfast speech last week to a group of regional business executives and
academics that
the questions he faces are getting tougher.
The most vocal outcry, he said, was over the Comprehensive Master Plan,
which is about to
undergo its first major revision since 1979, and a city zoning ordinance,
which has not
been rewritten since the 1940s. He said the public hearings begin this
summer.
"Everybody's input and perspective is important," he said. "But there are no
quick fixes."
The 21st Century Task Force report, funded by corporations and charities,
was the result of
nearly two years of discussions and study by the group. Some of the same
entities fund
Leadership Newark, a two-year fellowship started by Roper in 1998 to train
future leaders.
The task force was similar to the defunct Newark Collaboration Group, a
committee
comprising corporate and elected officials headed by James a decade ago. But
the task force
was different in one respect: By design, elected leaders were excluded from
the panel.
The process of rebuilding Newark's civic culture, giving birth to a
renaissance of
political action, is far from complete.
In the Newark school board election last month, only the second since the
state took
control of the schools in 1995, just 7 percent of the 114,075 eligible
voters went to the
polls. Similarly, only a handful of familiar faces attend vital public
meetings, like City
Council budget hearings and planning board sessions. Activists say that when
they do speak
out, they frequently walk away believing their views did not cou