An organization opposed to public financing for American Dream Meadowlands plans to take the NJSEA to court to stop it from selling $1.15 billion in public bonds
LYNDHURST -- An organization opposed to public financing for American Dream Meadowlands plans to take the New Jersey Sports and Exposition Authority to court to stop it from selling $1.15 billion in public bonds to finish construction on the stalled project.
An attorney for the New Jersey Alliance for Fiscal Integrity delivered a letter to NJSEA Tuesday asking the organization to delay the bond issue until the state Appellate Court can decide whether it's legal.
Thomas Calcagni, an attorney for the alliance, said NJSEA had failed "to remedy the litany of procedural and substantive defects that plagued" the resolutions approving the bond sales.
The Appellate Division is allowing for an expedited hearing, with the Alliance and NJSEA filing briefs Friday and the court handing down a ruling sometime next week.
Timing is critical: Triple Five had planned to wrap up financing and resume construction by the end of September.
Calcagni laid out several objections to the bonds in his letter. Among those arguments, he said the NJSEA had not included the terms of the bonds, including maturities and interest rates in its initial approvals of the bonds, indicating its "desire to rush the bonds to market and leave the public in the dark."
The bonds also violate a number of state laws, he said.
NJSEA commissioners criticized the Alliance last week for hiding its backers. Because it is organized as a 501(c)(4) social welfare organization under federal tax law, the group does not have to disclose donors. Commissioners said they believe the group is backed by mall competitors.
The NJSEA declined to comment through a spokesman.
NJSEA approved the complex financing deal for American Dream on Thursday. The plan calls for it to sell $1.15 billion in bonds to the Wisconsin Public Finance Authority and use the proceeds to help finish construction of American Dream.
The Wisconsin Public Finance Authority will simultaneously sell bonds to the public. Those bondholders will be repaid through a combination of sales tax revenue generated by the finished complex and through a payment-in-lieu of taxes agreement reached between East Rutherford, NJSEA and Triple Five.
Triple Five officials said they have relied on the Wisconsin Public Finance Authority in the past as a quick way to get bonds to market.
The developer expects to finish American Dream in summer 2018.
Myles Ma may be reached at mma@njadvancemedia.com. Follow him on Twitter @MylesMaNJ. Find NJ.com on Facebook.