The court cleared the way for a state agency to sell bonds to help finish the construction of American Dream.
LYNDHURST -- A court cleared the way Tuesday for a state agency to issue $1.15 billion in bonds to help finish the construction of American Dream Meadowlands.
A three-judge appellate panel dismissed claims saying the bond sale violated state regulations in a decision handed down Tuesday afternoon.
The New Jersey Alliance for Fiscal Integrity, a non-profit advocacy group, filed an appeal Friday challenging the bond issue. The group said the bonds violate a number of financial regulations.
The decision handed down late Tuesday afternoon said NJSEA complied with financing rules and did not put New Jersey taxpayers at risk.
"The NJSEA bond sale terms will put the buyer clearly on notice that these are non-recourse bonds, not backed by the full faith and credit of the state, and the bondholder takes the sole risk of non-payment on its investment," the court said.
The road to a runaway American Dream
The complex financing deal calls for the New Jersey Sports and Exposition Authority to sell $1.15 billion in bonds to the Wisconsin Public Finance Authority and hand the proceeds to Triple Five to resume work on American Dream. The Wisconsin agency would simultaneously sell its own bonds to the public in Wisconsin.
The bondholders would be repaid through a combination of up to $390 million in sales tax revenue generated by American Dream and through a payment-in-lieu-of-taxes agreement reached between East Rutherford, NJSEA and Triple Five.
Tony Armlin, vice president of development for Triple Five, said he was pleased with the ruling.
"Now that this frivolous claim has been dismissed, American Dream--a world-class retail, tourist and entertainment destination that will serve as the economic engine for the region--will be completed," he said.
NJSEA commissioners have criticized the Alliance for not revealing its backers, which they believe to be other retailers. The Alliance says on its website it is "supported by taxpayers and North Jersey businesses."
However, the Alliance is organized as a 501(c)(4) advocacy group under federal tax laws, allowing it to hide its donors. Mark Bentivegna, an accountant, is listed on the group's website as its president and treasurer.
Triple Five, the developer of American Dream, had planned to wrap up financing and resume construction by the end of September. The project, first proposed under the name Xanadu in 2002, has progressed in fits and starts over the years. The recent hiccup came this April, when Triple Five ran into trouble securing financing for American Dream.
The developer has spent $600 million on American Dream since taking the project over in 2010 from a consortium of lenders.
Myles Ma may be reached at mma@njadvancemedia.com. Follow him on Twitter @MylesMaNJ. Find NJ.com on Facebook.
