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In 2014, with the township debt already over $56M, the Township Committee voted to increase Readington's debt by over $3.2 MILLION.
$2,405,685 for capital improvements via ordinance #11-2014 (see page 8), including road projects ($1.37M) and park and recreation improvements ($175,000).
After incurring this additional debt, the Township Committee later claimed a $111,600 budget surplus for Roads that was taken to pay legal expenditures. See "Notable Budget Items" below. With regard to parks and recreation, the Township Committee could have used funds to be received under the Transco agreement, but chose instead to incur debt and use the Transco funds for new land purchase. See "Transco Pipeline" below.
$400,300 to finance sewer improvements. These sewer projects were to have been financed under an original bond for $983,250 issued under ordinance #22-2005 in 2005. Almost 10 years later the original bond is to be increased by more than 50% because "costs exceeded estimates" and two out of the six original projects had never been completed. See 9-15-14 RTC meeting minutes, page 7.
$408,500 to finance the acquisition of Block 32, lot 12 and Block 34, lots 10 and 11, each of which are 1-2 acre lots in Whitehouse Station owned by Fallone at Readington LLC. These are landlocked lots currently on a "paper" street, but appraisals solicited by the township valued the property as if the street actually existed. See appraisal. The stated purpose for the acquisitions was to satisfy COAH (affordable housing) obligations. See 11-17-14 RTC meeting minutes.
Township Committee Authorized "Emergency" Appropriation to Pay 2014 Legal Expenses Which Top $950k
On May 19, 2014, the Township Committee adopted Readington's 2014 budget, which included a line item of $400k for legal expenditures for all of 2014. This was purportedly a good faith estimate despite
(1) the fact that Readington had spent $351k in 2013 on legal expenditures and 2014 was to include the lengthy and complex Solberg trial;
(2) the fact that (1) above was directly brought to the Committee's attention at the May 19th meeting by a concerned resident; and
(3) the fact that as of the end of April of 2014, Readington had already incurred at least $367k in legal expenditures in connection with the Solberg litigation. See HCD article.
A mere 12 weeks later at the August 11, 2014 meeting, the Township Committee adopted a resolution authorizing an emergency appropriation of an additional $395k to pay legal expenses. The resolution specifically stated that
"an emergency has arisen with respect to legal services for ongoing litigation and settlement of certain matters and no adequate provision was made in the 2014 budget" See resolution.
The law authorizing emergency appropriations in this manner was intended for, and is typically used for entirely unforeseen and unexpected expenditures, for example, a natural disaster such as hurricane Sandy. Legal expenditures were not unforeseen or unexpected as of May 19th when the budget was passed. Under the law, the $395k will be deferred to the 2015 budget.
Further, on December 22, 2014, the Township Committee authorized the transfer of an additional $150k from surplus budget line items (primarily police and roads) into the legal expenditure line item. See 12/22/14 RCT meeting minutes, page 5.
In sum, Readington has incurred at least $950k in legal expenditures in 2014, and has used an unorthodox means to finance its expenditures that defers a significant portion of the expense into 2015.
Transco is a done deal with an agreement in place and much of the compensation expected to be received already spent in 2014.
The Transco Pipeline requires an easement through some land in Readington Township that is under the Green Acres program, and therefore constitutes a "diversion" of the land under the applicable regulations. On November 3, 2014, Readington publicly released the fact that it had reached an agreement on the matter where Readington would seek the necessary diversions in return for compensation of $522,000. Under the Green Acres regulations, compensation received for such a diversion must be used for replacement land acquisitions, for construction of parkland improvements, or a combination of both. See Green Acres regulations, 7:36-26.10 (p. 126). Despite improvements needed for our existing parks (for example, the roller hockey rink at Summer Road Park that is in a state of disrepair and the tennis courts known to be in need of resurfacing (see "Additional Debt" section above)), the Township Committee opted to commit the funds for new land acquisitions. On December 1st, the Township Committee passed resolutions committing (contingent on receipt of the Transco funds) to the purchase the following properties:
1 - Block 66, Lot 53, which is a 5 acre, landlocked piece of property that is bordered by already preserved open space land, Julia and Richard Allen's preserved farmland, and property owned by Sam Tropello. The landlocked property has an access easement over the Allen's property (lot 24) to allow egress to Hillcrest Road. See tax map. Sam Tropello was unaware of the land transaction until after the fact, but the Allens were aware in advance.
2 - Block 44, Lot 4.02, which is a 19 acre parcel located located off of Dreahook Rd.
See 12/1/14 RTC meeting minutes, page 4-6. The public release of the details of the Transco agreement and the almost immediate subsequent agreements to purchase new land parcels with the money that would be received occurred immediately after the general election but before the new year when new committee members would take their seats.
On May 4, 2015 the trial court in the Solberg condemnation
case issued its ruling. Readington LOST the
case, and had its condemnation complaint entirely invalidated.
Readington lost BECAUSE the trial court found that despite
its pleadings and testimony in court, the facts established that the condemnation
was done for the purpose of preventing expansion of the airport which is not a
valid public purpose (a legal holding by the Appellate court in this case in
2009). In view of the Appellate court's
holding, the trial court was instructed to, and did, assess the facts to
determine what Readington's true purpose really was, which is what dictated the
Readington was found to have engaged in "deliberate
subterfuge" in its attempts to hide its true anti-expansion agenda behind a seemingly
legitimate open space purpose. Because
of this, the trial court held that the action had been "brought in bad faith" and was a "manifest abuse" of eminent domain law.
The trial court further found that Readington officials had
been untrustworthy in their testimony and as a whole "unworthy of belief" and
that they had demonstrated a "lack of public candor" with residents during the
time leading up to the bond referendum and filing of the eminent domain
Readington was ordered to pay all of the Solbergs' attorney
fees and expenses on the matter dating back to 2001.
Residents should read the trial court opinion in its
entirety, and also to read the earlier Appellate court decision in this case,
to fully understand the situation we are currently in.
Trial Court Decision
Appellate Court Decision