Who benefits most from New Jersey’s ‘American Dream’ mega-mall project?

This is the final installment of Mall Madness, a five-part series on the American Dream retail and entertainment complex under construction in the Meadowlands. The series was produced through a reporting collaboration between WNYC, NJ Spotlight, and Bloomberg Businessweek. The first story, second story, third story, and fourth story are also available online. The mall is schedule to open in the fall of 2018.

 

NJ Spotlight’s John Reitmeyer gives an overview of the American Dream Meadowlands project on WHYY-FM

The jury is out on whether the American Dream megamall will ever become a financial success, but one group has already benefited tremendously from the project — Gov. Chris Christie and his political allies.

Political donations to Christie’s campaign coffers, legal work for firms aligned with Christie, and large contributions to the Republican Governors Association have all occurred since Canada-based developer Triple Five took over work on the massive American Dream project located on state-owned land in the Meadowlands in East Rutherford.

A review of campaign-finance documents since 2011, when Triple Five entered the picture after two failed efforts by previous developers, show contributions from those with ties to the project total more than $350,000, and many who gave money to Christie’s unsuccessful presidential campaign donated up to the maximum amount allowed. Members of the Ghermezian family, the driving force behind Triple Five, have also made contributions to the state Republican Party, the records indicate.

Republicans

Federal IRS records show the governors association, an organization that spent $1.7 million on TV ads supporting Christie or attacking his Democratic opponent during his successful 2013 campaign for reelection in New Jersey, received a $300,000 contribution from the NJ Laborers PAC, the political fund of the 20,000-member labor union whose members are in line for jobs at the American Dream site once construction resumes in earnest.

Christie spoke about the American Dream project while picking up the union’s endorsement in person in late 2012, saying it would become a “job machine for the people of North Jersey.”

The RGA, according to the IRS records, also received $10,000 that year from McManimon, Scotland & Baumann, the law firm serving as a special counsel for Ameream, Triple Five’s subsidiary for the American Dream project.

Lawyers

The group that seems to have benefited most from work related to the American Dream effort is Gibbons PC, a major New Jersey law firm that employs William Palatucci, one of Christie’s closest friends and advisors. The New Jersey Sports & Exposition Authority, which is overseeing the American Dream project, said in response to an open-records request that it has paid Gibbons $7.42 million in legal fees since 2011. But the agency would not provide more detailed information despite repeated records requests.

“Gibbons PC, along with other firms, were approved by the NJSEA board to perform legal services in areas where firms have particular experience and expertise. Gibbons PC was assigned legal work on a wide array of issues including the American Dream project,” the NJSEA said in a statement. Palatucci and Gibbons attorney Peter Torcicollo were among the many firm employees to make contributions to Christie’s presidential campaign, the records show.

The Chiesa, Shahinian & Giantomasi law firm, previously called Wolff & Samson — whose founding member David Samson pleaded guilty in federal court earlier this year to charges that arose in the wake of the Bridgegate scandal — was also at one point representing Triple Five, records indicate.

To be clear, the campaign contributions are not illegal, and New Jersey is a state that is already well known for its long history of pay-to-play politics, under both Democratic and Republican administrations. But it was Christie who set a high ethical bar as a candidate for governor in 2009, running on his record as a former federal prosecutor who aggressively and successfully targeted political corruption in New Jersey. His 2009 gubernatorial campaign also ran a television ad that year in the wake of a major summer bribery scandal that promised he would “change Trenton” if elected.

Christie declined through a spokesman to be interviewed about the American Dream project. His press secretary instead released a statement, but it did not directly address a question sent by email asking whether the campaign contributions have in any way influenced the public-approval process for the American Dream project.

Christie for President

The contributions to Christie’s presidential campaign collected just from Triple Five executives totaled nearly $9,000, according federal records. Triple Five executive vice president Martin Walrath and general counsel and vice president of strategy Joseph Calascibetta each donated $2,600, and senior vice president for development Tony Armlin donated $2,700, according to federal records. Glenn Scotland, special counsel for Ameream, donated $1,000 to Christie For President, the records show.

More Republicans

Federal records also show $10,000 contributions were made to the New Jersey Republican Party’s federal account earlier this year by two members of the Ghermezian family, Syd Ghermezian and Aviva Ghermezian. Walrath and Calascibetta also made $10,000 contributions to the state GOP as well, federal records indicate.

A statement provided by Triple Five representatives said political contributions are made from time to time “like many other individuals exercising their (free-speech) rights.”

“They are not linked to any governmental action,” the statement said.

What about the taxpayers?

Senate Majority Leader Loretta Weinberg (D-Bergen) said she’s not surprised at all to hear about the campaign contributions.

“It would surprise me if you told me you didn’t come across any contributions,” she said during an interview in her legislative office.

But she quickly turned serious when discussing the NJSEA. Backing Triple Five’s planned bond sale are pledged state-tax incentives worth up to $390 million, and payments-in-lieu-of-taxes through a redevelopment agreement with East Rutherford that are worth up to $800 million.

The complicated finance plan was approved during public meetings held over the summer by the NJSEA, but the agency held those meetings during the middle of the day at an off-the-beaten-path location in the middle of the Meadowlands. The agency also allows NJSEA board members to cast votes by phone.

Weinberg said she’s concerned that on the American Dream project there’s simply been “too much investment on the part of the public with very little public oversight.”

“I think that it just needs to be done with a lot of accountability and a lot of public oversight, and we don’t have that in a lot of these autonomous or semi-autonomous commissions,” Weinberg said.

East Rutherford Mayor James Cassella, a Republican, said he understands that taxpayers may be looking at the project skeptically because of the reputation that many New Jersey politicians have these days.

“Even though 95 percent of the politicians are probably as honest as the day is long, it’s people think all politicians are crooked, so there’s something in it for them,” Cassella said.

But no matter what ends up happening with the megamall project — Triple Five is now shooting for a fall 2018 opening — Cassella said for East Rutherford residents, life will continue.

“It’s here, if it opens, fine. If it doesn’t, so be it … our lives up on the hill here will go on,” the mayor said.

Although Christie once bragged that American Dream would open in time for the Super Bowl that New Jersey hosted back in 2014, the statement provided by his press secretary, Brian Murray, also expressed a sense of resignation about the status of the American Dream project. Christie’s second term ends in early 2018, well before Triple Five plans to open the doors of American Dream to the public.

“We have witnessed many different development proposals for this location, dating back through the administrations of at least four previous governors,” the statement said. “That experience has taught us that governors have very little control over these kinds of projects, no matter how beneficial they may be to New Jersey.”

John Reitmeyer is the budget and public finance writer for NJ Spotlight. Ilya Marritz is a reporter/producer for WNYC. Susan Berfield is a reporter for Bloomberg Businessweek.

The Mall Madness series was produced through a reporting collaboration between WNYC, NJ Spotlight, and Bloomberg Businessweek.

NJ Spotlight, an independent online news service on issues critical to New Jersey, makes its in-depth reporting available to NewsWorks.