The Monmouth County Board of Chosen Freeholders agreed to back up the acquisition of the 560 acres at Fort Monmouth that is not already controlled by the Fort Monmouth Economic Revitalization Authority (FMERA) with a $35 million bond guarantee. The Freeholders voted 4-1, with John Curley opposing the guarantee, at their meeting last night which was held in Ocean Township.
The Freeholders’ action enables the Monmouth County Improvement Authority to guarantee bonds issued by FMERA. With the AAA bond rating of MCIA, the bonds will have the lowest interest rate available in the market. FMERA will use the proceeds to purchase the land, valued at $90 million, from the Department of the Army for roughly $35 million. The bonds will be secured by the land.
Freeholder Director Tom Arnone told MoreMonmouthMusings that the $55 million profits from the anticipated land sales would be used to complete necessary infrastructure improvements in the former fort. Arnone said that without this agreement and with the Department of the Army’s continued involvement in the property, that roughly 60% of the land sale proceeds ($54 million of the anticipated $90 million) would go to the federal government. Additionally, the Department of the Army currently has the authority to approve or reject proposed sales and uses of the property. Upon completion of the acquisition, the Army and the federal government no longer have any control of the former fort.
Arnone and Freeholder Lillian Burry, a member of the FMERA board and the driving force behind the acquisition, both said that they anticipate that $10 million of the bonds will be paid down in the next several months as property sales that are being negotiated close.
Curley objected to the bond guarantee on the grounds that FMERA is not a taxing authority and that in most cases MCIA is guaranteeing bonds for Monmouth County towns that can pay them off by increasing property taxes. Additionally, Curley wanted the towns that host of fort, Oceanport, Eatontown and Tinton Falls to have authority over the uses of the property through their planning and zoning board, effectively replacing the Army’s red tape with local red tape.
But the mayors of those towns, all of whom serve on FMERA with Burry, support the acquistion, even if it does not give their land use boards authority over the uses. Mayor John Coffey of Oceanport said,“Combined, Fort Monmouth and Monmouth Park make up about 690 acres of a town that is only 2,400 acres. This financing takes a player out of the equation. It is essentially addition by subtraction. We are removing a bureaucracy that has slowed things down and taking it completely out of play. We will have one less approval to gain and one less hurdle to jump.”
“The potential impact of this tremendous redevelopment on the quality of life, tax revenue, amenities and overall living standard for the three boroughs, the county and our residents is enormous, and its many benefits will be enjoyed for decades to come,” said Freeholder Burry when the bond guarantees were first introduced at the Freeholders previous meeting on August 11.
“This is the right decision for Monmouth County. By guaranteeing these bonds we are helping to support the three boroughs and everyone in Monmouth County. With an estimated market value of more than $90 million for the project, and a total improvement value estimated at about $1 billion over the next ten years, this is a good investment,” said Freeholder Deputy Director Serena DiMaso, liaison to the MCIA.
“The best option for county taxpayers is for the County to assume the leadership role in regard to the Fort Monmouth Reuse Plan. We have a responsibility to ensure the property is returned to its once vital place in the economy of our county, and by guaranteeing the sale of these bonds we take an active role in the future successes for the site,” Arnone said.
The Freeholders and FMERA, especially Freeholder Burry in her role serving on both boards, are to be congratulated. They got the land at Fort Monmouth for $19 million less than it would have cost had the Army stayed involved and they got the red tape of the Army out of the equation. Given the value of the land vs the cost to finance the purchase, there is little, if any risk to Monmouth County taxpayers. We suspect the rating agencies will agree when the next AAA bond rating is issued.