The rationale for settling is bad law, bad policy, and just plain gutless.

Sometimes you settle for practical reasons. But when the guys you did a favor for then turn around and sue you because you won't re-write their contract and give them an even sweeter deal... that's just plain wrong. It's extortion, and you fight it, if for no other reason than to show the rest of the world you won't roll over when they threaten you.

Did I mention that the company doing this is the largest residential builder in NJ? Maybe it makes more sense to give in when the bully is really big.

Congratulations to Councilmen Fulop, Lavarro, and Donnelly for fighting for the people of Jersey City.

Unfortunately, this is another blown call (at best) for Mayor Healy, and for those councilmembers who supported him. I would expect some of these elected leaders to know better. Especially those who represent distressed communities which don't get sweetheart abatements. But this is a straight Team Healy vote. Expect more of the same.

Jersey City developer could save $300,000 thanks to deal OK'd by City Council

Thursday, September 27, 2012, 9:04 PM
By Terrence T. McDonald/The Jersey Journal

Jersey City will not assess a service charge on unsold units in a Downtown luxury condo complex for one year unless the units are sold by then, thanks to an agreement approved by the City Council tonight.

The council in August rejected a move by the city administration to amend its original tax break for K. Hovnanian, developer of the 420-unit 77 Hudson St. The rejected measure would have lowered the developer?s annual service charge to the city from 16 to 11 percent of its annual gross revenue for the first three years of the deal.

The new deal, approved 5-3 by the council tonight, would just affect just the service charge on the 66 unsold units at 77 Hudson Street according to a Sept. 21 memo from Corporation Counsel Bill Matsikoudis.

Matsikoudis? memo says Hovnanian sells about eight units at 77 Hudson St. each month.

The deal approved tonight, which could save Hovnanian as little as $300,000 and as much as nearly $800,000, ends a lawsuit the developer filed in 2009, arguing the city showed ?bias? by not amending a tax-break deal for Hovnanian?s 420-unit 77 Hudson St., as the city did with a similar complex on Second Street.

?The current proposed settlement is superior to the previous agreement the City Council rejected,? Matsikoudis writes in his memo, urging the council to approve the deal because of the ?risk? of litigation.

Council member David Donnelly, Steve Fulop and Rolando Lavarro voted against the measure ? Councilwoman Nidia Lopez was absent ? with Fulop saying it will ?cost the taxpayers significant money.?

?If you?re going to readjust and bail out the big developers, the same should apply to the small taxpayer,? Fulop said.

The city originally won the case Hovnanian brought, but that decision was overturned by an appellate court, which sent the case back to the lower court. Matsikoudis said in July he wants to settle because he believes the trial judge showed some ?favorability? to Hovnanian.

http://www.nj.com/hudson/index.ssf/20 ... y_developer_could_sa.html

Settlement between Jersey City and developer will cost city $900K in tax revenue

July 19, 2012, 8:23 AM
By Terrence T. McDonald/The Jersey Journal

A legal settlement between Jersey City and the developer of a Downtown luxury condo complex was given initial approval by the City Council yesterday, with city officials saying the deal will cost the city about $900,000 in revenue over three years.

The settlement would end a lawsuit filed by developer K. Hovnanian in 2009 that argued the city showed ?bias? by not amending a tax-break deal for Hovnanian?s 420-unit 77 Hudson St., as the city did with a similar complex on Second Street.

Under the terms of the settlement, which was approved yesterday by a 6-3 vote, the city amended its 20-year tax abatement with Hovnanian by reducing the developer?s annual service charge to the city from 16 to 11 percent of its annual gross revenue for the first three years of the deal.

The decreased payments from Hovnanian amount to $892,500 over the course of the three years, city spokeswoman Jennifer Morrill said.

Hovnanian says sales at 77 Hudson St. have ?languished,? with 85 units unsold, according to the city.

The change would only affect units unsold as of July 18, 2012.

Hovnanian asked for the amendment in 2009 to ?level the competitive playing field,? its attorney said at the time. The city, which denied Hovnanian?s request then, had previously granted a deal to the developers of the 269-unit Crystal Point condo building on Second Street that was identical to the one requested by Hovnanian.

Council members Steve Fulop, Rolando Lavarro and Viola Richardson voted against the settlement, which will be voted on again before it is finalized.

Corporation Counsel Bill Matsikoudis told the council Monday he wants to settle the dispute because he believes the judge in the case has indicated ?some favorability? toward Hovnanian?s claims.

http://www.nj.com/jjournal-news/index ... y_council_approves_s.html

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Historically, the Council has always held it's meetings during the day in the summer months. Doesn't mean they aren't still FOS.

As a side note, the city council meeting where they approved this was held at 10am today, so I can't imagine very many residents were able to make it and speak out about it. I don't want to make an accusation that it was planned that way, but it seems all too convenient for the city council.

Shame on K Hovnanian as well - if your condos aren't selling, why not try lowering the price rather than f___ing Jersey City over? That's a good strategy, under the basic laws of supply and demand. Don't these people know high school economics?

Jersey City City Council gives initial approval to new tax deal for 77 Hudson St. developer

July 18, 2012, 12:41 PM
By Terrence T. McDonald/The Jersey Journal

A legal settlement between Jersey City and the developer of a Downtown luxury condo complex was given initial approval by the City Council today.

The settlement would end a lawsuit filed by developer K. Hovnanian in 2009 that argued the city showed ?bias? by not amending a tax-break deal for Hovnanian?s 420-unit 77 Hudson St. as the city did with a similar complex on Second Street.

Under the terms of the settlement, which was approved today by a 6-3 vote, the city would amended its 20-year tax abatement with Hovnanian by reducing the developer?s annual service charge to the city from 16 to 11 percent of its annual gross revenue for the first three years of the deal.

Hovnanian says sales at 77 Hudson St. have ?languished,? with more than 85 units unsold, according to the city.

The change would only affect units unsold as of July 18, 2012, according to the proposed settlement agreement.

Hovnanian asked for the amendment in 2009 to ?level the competitive playing field,? its attorney said at the time. The city, which denied Hovnanian?s request then, had previously granted a deal to the developers of the 269-unit Crystal Point condo building on Second Street that was identical to the one requested by Hovnanian.

Council members Steve Fulop, Rolando Lavarro and Viola Richardson voted against the settlement, which needs another council vote before it is finalized.

Corporation Counsel Bill Matiskoudis told the council on Monday that he wants to settle the dispute because he believes the judge in the case has indicated ?some favorability? toward Hovnanian?s claims.

The suit was originally thrown out at the trial-court level, a decision overturned by an appellate court, which sent the case back to the lower court for review.

http://www.nj.com/hudson/index.ssf/20 ... city_council_gives_4.html

hero69 is on point here. The banks, investment houses, hedge funds, corporations and real estate speculators ... all part of the 1% who are bleeding this country dry while the middle and lower classes get screwed. Romney is their hero.

@hero69- and the really disgusting thing is for you to try and bring Romney into this thread, just goes to show how ignorant you really are.

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+1

I'm glad you said Healy & Co. Most of the City Council people are lackeys of the developers.

This is so disgusting.....It seems Healy & Co. are like Romney & Co. A bunch of liars (imo) whose ultimate loyalty is to their paymasters and not voters and taxpayers.

Jersey City administration asks City Council to approve settlement providing tax break to end Hovnanian lawsuit

July 17, 2012, 9:21 AM
By Terrence T. McDonald/The Jersey Journal

Jersey City officials are recommending that the City Council tomorrow approve a legal settlement with a developer who sued the city in 2009 after the council denied the developer?s request to amend its tax-break deal with the city.

Corporation Counsel Bill Matsikoudis at yesterday?s council caucus urged the nine-member body to approve the settlement, saying he believes the city could lose the suit and end up with a far worse deal than the one contained in the settlement.

Hovnanian, the developer behind the 420-unit condominium complex at 77 Hudson St., in late 2009 requested the city revise Hovnanian?s 20-year tax deal with the city, saying it was having trouble selling units in a declining housing market.

The council denied the request and Hovnanian sued. A similar request by the developers of the 269-unit Crystal Point complex on Second Street was approved, indicating ?bias in favor of? the Crystal Point developer, a Hovnanian representative told the council in October 2009.

The city initially won the case, but the decision was overturned by an appellate court, which sent the case back to the lower court.

Matsikoudis said yesterday he believes the trial judge presiding over the case has indicated ?some favorability? toward Hovnanian?s claims, and Matsikoudis wants to settle.

Under the terms of the settlement, which the council is scheduled to approve at its meeting tomorrow at 10 a.m., Hovnanian?s annual service charge would be reduced from 16 to 11 percent of its annual gross revenue for the initial three years of the 20-year tax abatement.

The change would only affect the units unsold as of July 18, 2012, which the city says is more than 85.

77 Hudson St., which NJTV has named one of the best places to live in New Jersey, was the target of a federal investigation, with the feds in March 2011 indicting six people involved in the building?s construction on charges including unlawful payments to union officials and embezzlement. All have since pleaded guilty to various charges, and two were sentenced last week.

http://www.nj.com/jjournal-news/index ... y_administration_ask.html

Disgusting. Once again, Jersey City gets bullied into giving a developer what they want, regardless of what the original terms of the abatement said.

Hey K Hovanian - you say your condos aren't selling? You need to have an even sweeter deal from the city, despite what was already negotiated and agreed to years ago?

Here's a brilliant idea - LOWER the selling price of your condos. They aren't selling because they are overpriced. No matter how nice they may be and how great the location is, the rules of supply and demand will always exist. WHY is this so hard for you to understand?

JC taxpayers continue to subsidize high end luxury housing - the Crystal Point post construction tax abatement rears its ugly head as 77 Hudson looks to be correct in assuming precedent was set. looks like tax abatement subsidies now are as of right.


Jersey City administration asks City Council to approve settlement providing tax break to end Hovnanian lawsuit

Jersey City officials are recommending that the City Council tomorrow approve a legal settlement with a developer who sued the city in 2009 after the council denied the developer?s request to amend its tax-break deal with the city.

Corporation Counsel Bill Matsikoudis at yesterday?s council caucus urged the nine-member body to approve the settlement, saying he believes the city could lose the suit and end up with a far worse deal than the one contained in the settlement.

Hovnanian, the developer behind the 420-unit condominium complex at 77 Hudson St., in late 2009 requested the city revise Hovnanian?s 20-year tax deal with the city, saying it was having trouble selling units in a declining housing market.

The council denied the request and Hovnanian sued. A similar request by the developers of the 269-unit Crystal Point complex on Second Street was approved, indicating ?bias in favor of? the Crystal Point developer, a Hovnanian representative told the council in October 2009.

The city initially won the case, but the decision was overturned by an appellate court, which sent the case back to the lower court.

Matsikoudis said yesterday he believes the trial judge presiding over the case has indicated ?some favorability? toward Hovnanian?s claims, and Matsikoudis wants to settle.

Under the terms of the settlement, which the council is scheduled to approve at its meeting tomorrow at 10 a.m., Hovnanian?s annual service charge would be reduced from 16 to 11 percent of its annual gross revenue for the initial three years of the 20-year tax abatement.

The change would only affect the units unsold as of July 18, 2012, which the city says is more than 85.

77 Hudson St., which NJTV has named one of the best places to live in New Jersey, was the target of a federal investigation, with the feds in March 2011 indicting six people involved in the building?s construction on charges including unlawful payments to union officials and embezzlement. All have since pleaded guilty to various charges, and two were sentenced last week.

http://www.nj.com/jjournal-news/index ... y_administration_ask.html

77 Hudson advertises on LXTV regularly so gets puff pieces on that OpenHouse show every so often.

Still can't imagine they're selling too many units in this environment...

77 hudson was just on Open House NYC on NBC. Maybe it'll be online later. I searched the website and found an older one. someone must be on the payola.
http://lxtv.com/openhousenyc/video/8043

Only a couple of more months before Vega goes on trial and then we'll be rid of the troll.

Developer gets nowhere with lawsuit challenging Jersey City's refusal to give better abatement to 77 Hudson

Friday, August 06, 2010
Melissa Hayes - The Jersey Journal

A Superior Court judge has dismissed a lawsuit filed by a developer seeking a better tax abatement deal in Jersey City.

Judge Mark Baber dismissed with prejudice K. Hovnanian's suit against Jersey City on July 30, which means the developer can not refile the suit.

K. Hovnanian has been seeking an amended tax abatement, arguing its development, 77 Hudson, should get the same treatment as competitor Crystal Point.

Last year, Crystal Point's abatement was changed from 20 to 30 years. Instead of paying 16 percent of the project's gross income per year, owners pay 11 percent for the first five years, 13 percent for the next five and 16 percent for the duration.

The 420-unit 77 Hudson is not on the water, but is close to the Essex Street Light Rail. Both buildings are in close proximity to PATH stations.

K. Hovnanian officials have argued that Crystal Point is outpacing 77 Hudson in sales because of the amended tax abatement.

After city officials repeatedly refused to amend 77 Hudson's abatement, K. Hovnanian filed a four-count complaint in Superior Court alleging the denial was arbitrary and capricious; violated the implied covenant of good faith and fair dealing; violated its due process and equal protection rights under the U.S. Constitution; and violated the uniformity clause of the state Constitution.

MELISSA HAYES

K Hovnanian's appeal denied in bid for enhanced abatement. Would be nice if the judge had the discretion to force KHov to give back some of the original abatement just for the nuisance factor.

Judge: 77 Hudson Developer ?Has No Right? to Challenge Jersey City?s Abatement Decision
By Jon Whiten ? Aug 6th, 2010 ? Category: Blog, News, Politics

Developer K. Hovnanian?s attempt to force Jersey City to revise its tax abatement deal for the 77 Hudson condo building has been dismissed by a Superior Court judge, who found that ?Hovnanian has no legal right? to the amended deal.

The developer had gone to the city seeking a sweetened abatement deal after one was given in June to the developer of Crystal Point, a high-rise building at the Hudson River and 2nd Street. Hovnanian came to the city in August looking for a similar deal; the company argued that by not doing so, Jersey City was giving Crystal Point an unfair advantage in the tight luxury condo market.

But the Healy administration, under fire for its handling of abatements and its governance in general following last July?s corruption sweep, held its ground against Hovnanian. It refused to change the terms of the deal, arguing that Crystal Point was ?in an area that is clearly more remote? than 77 Hudson, which is near Exchange Place.

In October, the City Council unanimously voted against the developer?s application for an abatement change. Then in April, the city?s Tax Enhancement Committee did the same, and Hovnanian took the matter to court.

In the filing, Hovnanian argued that the city?s denial was ?arbitrary, capricious and unreasonable,? that it violated good faith and fair dealing, and that it violated both the U.S. and New Jersey constitutions.

The city moved to dismiss the charges, and in the ruling handed down last week, Superior Court Judge Mark Baber dismissed the case with prejudice, meaning Hovnanian cannot file the suit again.

?The city was under no obligation to grant or modify the initial abatement request or Hovnanian?s request for an amendment and violated no rights, constitutional or statutory, enjoyed by Hovnanian when it did so,? he writes.

Baber finds that the law has little say when it comes to enforcing what abatement terms a city chooses.

?Like the original decision whether to grant an abatement, the decision whether to agree to an amendment is discretionary on the part of the municipality,? he writes. ?Other than requiring the ?mutual consent of the municipality and the urban renewal entity,? the statute sets no standard under which a developer like Hovnanian would be would be entitled to an abatement or to an amendment of a previously approved abatement except by agreement.?

Hovnanian?s argument that it had been treated unfairly, Baber continues, ?overlooks the fact that the entire abatement scheme ? envisions a consensual relationship between the municipality and the developer.?

City attorney Bill Matsikoudis says he?s ?gratified? that the court ?recognized the City Council and mayor?s discretion in the awarding of tax abatements.?

Anyone know how 77 Hudson is selling or its counterpart renting? I haven't heard much, but last time I looked at pricing it was still in the nosebleed vicinity...

77 Hudson is a complete ripoff.

Quote:

The city "did the right thing"?

Don't kid yourself..... the FBI investigations are the only reason this didn't get approved.

The sad/funny part is how the committee and council have had to act like they are basing their decision on the fact that there is a big difference between the two buildings and that Crystal Point needs it while 77 Hudson does not.

It's like the family with the alcoholic parent. Everyone is so invested in coming up with reasons why things are bad but no one will state the obvious. Crystal Point's developers made $7,500 in cash contributions to Healy, et al the very day their abatement came before the council in June. The arrests happened in July. The rules have changed. It really is that simple - it would just be nice if someone on the committee or the council would save everyone the time and say so.

I'm floored that the city actually did the right thing... Maybe if K Hovanian didn't waste so much money on those 77 Hudson ads during the LXTV show they'd be in better shape...

Quote:

Tough sh_t.

Jersey City officials deny developers request for a better tax abatement again

By The Jersey Journal
April 16, 2010, 11:21AM

First Mayor Jerramiah T. Healy and the Jersey City City Council denied K. Hovanian's request for a better tax abatement deal. Now the city's Tax Enhancement Committee has as well.

K. Hovanian's Attorney Eugene Paolino wants the 77 Hudson condos to get the same treatment as the competing Crystal Point, whose abatement was changed from 20 to 30 years and owners pay 11 percent for the first five years, 13 percent for the next five and 16 percent for the duration, instead of the regular 16 percent throughout.

Paolino wanted to keep the 20 years, but wanted to pay 12 percent for the first two years, 14 for the next seven, and the standard 16 percent thereafter.

The abatement would result in a $1.7 million loss in revenue, something City Council was unanimously against.

"It's our position that the sales pace at Crysal Point is double ours and the only reason is the difference in the tax abatement," Francine Chesler, staff attorney for K. Hovnanian, said

The rationale of Crystal Point being "remote" is farfetched, but it is still right to deny the application for a new abatement.

Not to be cynical but look at the date of the post with the video from the city council meeting: Oct. 15, 2009. Now, note the date of the tax abatement committee meeting where the sweetened deal will be introduced: April 15, 2010. Six months, per Brennan's wishes, to the date.

Like clockwork.

Brennan said that it makes no sence to reintroduce an ordinance over and over again, as Fulop wanted to do. I agree with Brennan.

Question is if we will see the same type of view with this developer? Why do we keep hearing from him over and over again?

Wonder what Brennan's take is on this.

Hovnanian is a business and they are asking for the same deal as was given to another developer.

It is the Jersey City Council that caused this problem. Have they issued a policy change? What criteria did they give for denying this application? If they deny this again the city will get sued.

The council and mayor are a liability to this city and must be removed.

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It should come as no surprise that with the City Council, having given out PILOT's and Abatements for years now when they should have been charging a premium for property downtown, next to NYC where development costs are 3-fold what they are in JC, that these predatory developers would be back to the trough again.

Now that even the average resident here understands why taxes have been raised 25% to 30%+, we have a failing infrastructure of sewers and water lines, failing schools, corruption that is known across the US, incompetence and malfeasance at every corner, of muncipal government with a $500,000,000+ municipal budget, over $600,000,000+ school budget and now every developer who overbuilt on a housing bubble, (over 17,000 condos were approved to be built, most downtown) and now they come back again. These developers should have been taxed at full basis to hel9 improve our failing infrastructure, but then since JC is known as "pay to play", the council just rolls over if they smell possible monies for their campaigns in one or more job-holding capacity.

Where does JC's residents have a sign that says "bend over? As Esther correctly called them, corruptocrats who think we are their ATM! Tell Hovanian and any other developer, Hell NO!