East Brunswick is on the brink of reaching a conclusive settlement with Toll Brothers, but some members of the Township Council are keen on changing legal representation before finalizing the deal.
The council on Monday night tabled a slew of contracts for legal and professional services, in part due to the proposed reappointment of the DeCotiis, FitzPatrick and Cole law firm for the Golden Triangle redevelopment case. Mayor David Stahl, a Democrat, sought council approval for that and other appointments, but the council’s three Republicans, Camille Ferraro, Michael Hughes and Jim Wendell, contested the resolution.
The trio raised concerns about reappointing the law firm, contending that it produced an unfavorable agreement with Toll Brothers in 2005.
“I have some reluctance with this law firm because there was egregious actions and oversight that put us way behind the eight ball. Did anyone ever take responsibility for that?” Ferraro queried. “I have no faith in this firm. You may say that we’re too far down the road and it’s too late to change it now, but I don’t buy that.”
Toll Brothers agreed in 2005 to buy the 32-acre site from the township for $35 million. The builder was to construct 402 residential units and more than 180,000 square feet of retail space in the form of smaller shops. Toll Brothers made five annual payments of $4.5 million for a total of $22.5 million before announcing in 2008 that the project was no longer viable due to changes in market conditions. In 2009 both Toll Brothers and the township filed breach-ofcontract lawsuits, but the sides have since discussed a settlement to end the legal dispute .
A then-Democrat-controlled council voted 4-1 in June to grant preliminary approval for a new settlement that allows the purchase price to stand at the $22.5 million already paid. A condition of the settlement includes the implementation of a PILOT program, with Toll Brothers making a payment in lieu of taxes to the township annually, starting at $550,000 in 2011. The municipality would receive 95 percent of these fees; Middlesex County would receive the other 5 percent. The actual amount the township will receive in future years would be dictated by the square footage of the commercial and residential development, Stahl has said. East Brunswick is looking at a minimum of $1.1 million annually between apartment rentals and the commercial portion as taxes and fees increase, he said.
Since granting preliminary approval of the settlement, township officials have been working with DeCotiis firm attorney Matthew Karrenberg to flesh out details of the agreement and redevelopment plan. To move negotiations along between Toll Brothers and prospective retailers, the township has put forth amendments to a zoning ordinance tailored to the project’s needs. The revised ordinance awaits final adoption, but Stahl said the completion of the settlement is imminent.
The reappointment of the DeCotiis firm as redevelopment attorney, which was included in a general resolution of contractual appointments, was originally tabled at the council’s Jan. 3 reorganization meeting along with several other appointments. They were initially postponed on the premise that there was not enough background information on the appointees. Though all information was provided by Monday night’s meeting, issues remained with the contractual service appointments.
Wendell first posited the argument that the council had little time to review the township’s request for quotations (RFQs) and lacked paperwork crucial to their contracts, including pay-to-play affidavits and sworn statements to demonstrate compliance with other terms. Ferraro surmised that the absence of such documents could cause legal liabilities for the township, and suggested that the resolution be tabled.
However, Township Attorney Catherine Tamasik, a member of the DeCotiis firm, said that there would be no liabilities in relation to the pay-to-play affidavits, and that the council could make the submission of the documents a condition of approval.
“There’s no legal liability attached to the council if you were to vote on the resolution tonight. You could approve this on a conditional basis, in that the actual contracts sent to the service providers can be contingent on providing the statement,” she said.
Tamasik went on to explain that other documents, such as a political contribution exclusionary statement, are not required under the township’s fair and open process.
Stahl said that by postponing the appointments, the township is forced to adhere to the 2010 contracts, which are costing the township 10 percent more in legal and professional compensation than the contracts that are awaiting approval.
“Every time the council votes not to appoint these professionals, it is a vote to raise taxes,” Stahl said. “They’re getting paid 10 percent more than under the new contracts. If we can make sure to procure the affidavit before we officially award these contracts, then I would like to move ahead with this thing.” Stahl explained that there are very few appointments included in the resolution, and that the intent is to qualify several legal and professional services so they can be on call for the township. He questioned why council members did not raise these issues earlier.
Ferraro and Hughes then brought up their underlying concern about the legal representation in the Golden Triangle redevelopment.
“The crux of our argument is that the legal case this firm put together did not adequately provide enough protection for the township,” Hughes said. “I feel that’s a significant problem and should be a hindrance in being appointed again.”
He added that with the Golden Triangle redevelopment plan soon coming to a conclusion, East Brunswick needs counsel that officials can trust going forward.
However, Democratic Councilwoman Denise Contrino said that replacing the attorney now would end up costing the taxpayers.
“Changing counsel this late in the game will be an enormous expense. They would need to start from scratch,” she said. “Also, the current redevelopment counsel handling the case is not the same one from 2005. Holding them accountable for something a different attorney did is unfair and will ultimately cost the taxpayer.”
Wendell suggested that the township consider using the independent auditor who contributed to the June 2010 preliminary settlement.
“Saying that the attorney would need to start fresh is a bit naïve given that we brought in an independent auditor who caught up quickly,” he said. “Maybe it would be best to change to that firm, which we’re already familiar with.”
Stahl was not pleased with the lastminute opposition, and said it was brought up in order to hold someone responsible for what happened six years ago.
“This is a political game for who’s to blame,” he said. “Hindsight brings perfect clarity. If I had known that the economy would collapse, then I would have never voted for that agreement. The world in 2005 was much different than it was in 2008, or even than it is now.”
Stahl said that the attorney was most likely following orders from the township officials assigned to the project at the time, but now the attorney would be following his instructions.
Changing the attorney now, he said, would hinder the settlement process.
“To interject a new attorney with a new style after our current attorney has already developed a strong relationship with Toll Brothers, who is on the cusp of signing a document, will delay the process,” he said.
Stahl said he has never had a conversation with the independent auditor brought in last year, and therefore has little knowledge of what he is looking for in an agreement.
“I’m not afraid to stand up for what I believe in. This is a good law firm. This is a good agreement. Now let’s get it done,” he said.
The resolution was tabled to an unspecified date in a 3-2 vote along party lines. The township’s legal and professional service providers will continue to work in accordance with their 2010 contracts. The next council meeting is scheduled for Jan. 24.