InterCap Holdings CEO Steve Goldin has launched an all-out effort to convince West Windsor to negotiate a settlement with him in his lawsuit over the township’s redevelopment plan.
But there are some who believe that not only has Golden hurt himself just as much as the town with his lawsuit, West Windsor actually has no incentive at this point to come to even come to a settlement.
Under the worst-case scenario for West Windsor, the township could lose its redevelopment designation. But that could also mean that InterCap’s property would revert to the zoning prior to the redevelopment plan’s adoption — which does not allow for any housing at all.
“If the designation is deemed as being void, then the plan would have to be re-done,” said Township Attorney Michael Herbert. “There would have to be a new process of determining the redevelopment area, and the irony is that the biggest loser would be Mr. Goldin himself.”
“It’s a self-destructive approach, which we don’t quite comprehend,” added Herbert.
In addition, at a Township Council meeting this month, council members had acknowledged that there had been a settlement offer submitted by InterCap before a second round of advertisements were placed in the News, and after Herbert had sent InterCap a letter. They said the advertisement was misleading in that it used the dismal appearance of Route 571 — which has nothing to do with the InterCap lawsuit, they said — to convince residents to urge the township negotiate with InterCap. Council members also hinted that the campaign has hurt InterCap’s position at the negotiation table.
Goldin deferred any comment to his attorney, Richard J. Hoff Jr., of the Bisgaier Hoff law firm of Gibbsboro. Hoff disagrees with the township’s comments. The current zoning under the adopted redevelopment plan does not provide InterCap with an economically viable and realistic opportunity to build, he said. Nullifying the redevelopment plan would pave the way for InterCap to seek to have its previous zoning also voided.
And if InterCap does not get what it determines to be “economically viable” zoning for its property, it promises to be a thorn in West Windsor’s side. If the redevelopment plan or process is invalidated, Hoff has said the developer will re-file a previous lawsuit that challenged the old commercial zoning of the property.
“In the pending litigation, InterCap, in part, seeks the invalidation of the current redevelopment plan zoning for its property,” said Hoff. “Further, if the redevelopment process is invalidated and the property reverts to its prior (commercial) zoning, InterCap would reinstitute its original pre-development complaint, which challenged that zoning as illegal and unconstitutional.”
In that lawsuit, filed in December, 2008, InterCap alleges that the township violated Mount Laurel affordable housing regulations and that it discriminated against families with school children.
That lawsuit charges that the township’s zoning designation for the property is unconstitutional “as contrary to general welfare” of not just the municipal residents, but regional and state residents as well.
Citing state smart growth and affordable housing policies, the lawsuit alleges the township is not fulfilling state objectives of providing transit-oriented development to residents in need. It alleges that the township is in violation of the Mount Laurel Doctrine for failure to address affordable housing needs of cost-burdened households; that it failed to address unmet need as well as the need for workforce housing; and that it is in violation of the Federal Fair Housing Act.
That lawsuit also claims that one of the main reasons the township rejected InterCap’s proposals for the development of its 25 acres was “to prohibit the influx of school age children within the township,” which InterCap alleges is a violation of state and federal law against discrimination.
Goldin’s advertising campaign was prompted by a ruling on a procedural matter by Judge Linda Feinberg last month that seemed to be in InterCap’s favor. Goldin took it as an opportunity to enlist the help of the public in encouraging West Windsor to negotiate with him.
The litigation involves a plan for the 350-acre Princeton Junction train station redevelopment area adopted in March, 2009. The plan calls for a total base number of 483 housing units consisting of 311 market-priced units and 172 affordable housing units. As for non-residential development, the plan proposes 207,910 square feet of retail with the potential option to increase retail floor area in District 1 — which encompasses the 25 acres off Washington Road owned by InterCap Holdings — by an additional 67,500 square feet along with 7,500 square feet of added office space.
However, Herbert said there are two parts to the case — the first deals with a challenge to the redevelopment designation, and the second is a challenge to the plan. “The redevelopment designation was made in December, 2005,” said Herbert. “Mr. Goldin started buying property about a year later, fully acknowledging he was aware of the designation. He embraced it for three years, and only when he didn’t get the 1,440 units of housing did he challenge.”
Hoff said the first phase essentially serves as a new blight hearing, to be conducted by the court as opposed to the Planning Board. If the court rules it is not blighted, the redevelopment plan will be invalidated. If the court rules that the area is appropriately deemed to be blighted, the court will move on to the second phase, where it will conduct a hearing on InterCap’s argument that the redevelopment plan is unconstitutional and illegal.
“Again, if the township loses that and reverts to the prior zoning, it will face the original plan that challenged the constitutionality and legality of the original zoning,” said Hoff. “That lawsuit was voluntarily dismissed when the zoning was terminated by the adoption of the redevelopment plan. The adoption of the redevelopment plan resulted in the current litigation.”
One can see why Goldin would challenge the plan — he currently would be able to develop only 350 residential units on his property, while having to provide contributions to the infrastructure of the redevelopment area, including the roads, promenade, and parks.
“But, if in fact the designation was defective, then we go back to square one, and he’s where he was,” said Herbert. “The property would be where it was before the plan was adopted.”
Herbert said the township officials stand behind their designation and redevelopment plan, maintaining they used the correct process.
Even if the redevelopment designation is lost through the litigation, Herbert acknowledged one of the other options the township could employ — rezoning the parcels in the redevelopment zone through the use of the Municipal Land Use Law.
“The problem with that is we would lose a lot of benefits,” Herbert said. “We would not be able to have a master plan for a small area of the town; we would not be able to use bond financing wherein developers could use the municipal bond rating of the township,” which is seen as a tremendous incentive for developers, Herbert explained. “We would lose the prospect of receiving outside financial support as well as the kind of flexibility and financial initiatives which are only available under the redevelopment designation,” Herbert added.
However, in this scenario, “the township loses, and InterCap loses as well,” said Herbert.
The incentives the township was seeking do not, however, benefit InterCap at all, argued Hoff. “As InterCap cannot build under the current redevelopment zoning designation, it would not benefit from any purported incentive.”
Over the past few months, West Windsor has been trying to work with New Jersey Transit, which plans to build a new parking garage at the train station. According to Herbert, NJT has been waiting for West Windsor to come up with a plan for nearly four years. “I think they would move on,” Herbert said. “To the extent that we can have a redevelopment area continue without challenge, I think it would enhance our ability to work with New Jersey Transit.”
One could argue that West Windsor would still be getting a parking garage through NJ Transit’s own process, and with the Princeton Junction Overlay ordinance already in place, development will eventually occur along Route 571. However, “if a redevelopment plan for that area was unnecessary in the first place, one has to wonder why the township went through the process,” Hoff argues.
As for Goldin’s campaign, Herbert believes the move is just a “pressure tactic” to get 1,440 housing units approved for his property.
“Right now, the net density under the plan proposed is about 18 units an acre, which is the highest density in the entire region,” Herbert said. “The township’s willing to deal with a significantly higher density, but the town has made it clear they don’t want just a high-rise housing development. They want to have an integrated transit village with significant retail next to the second most active train station in the state, and public parks, a promenade, and facilities that are not simply a housing development.”
Mayor Shing-Fu Hsueh, who responded to Goldin’s campaign by submitting a letter to the editor in the last issue of the News, said that contrary to Goldin’s claims, the redevelopment plan he is trying to fight allows him to come to the township with all of the studies he has done and try to justify why he should get a certain number of housing units.
“The plan says that 350 units is his basic right,” Hsueh said. “If he wants to have more than 350 units on his property, there is a process he can follow.”
Hsueh said he expected Goldin would have been the first to come in and submit the studies he has conducted over the past three years. If and once he does that, there would be a plan developed with the number of housing units, retail space, offices, and amenities. “Instead of doing that, he filed litigation,” Hsueh said.
“We definitely want him to follow the process,” Hsueh said. However, Hsueh said, “he didn’t express interest in working with the township. The township would definitely look forward to working with him.”
Hsueh said, though, that it has to be an open and transparent process during which township professionals can review any details submitted by Goldin.
“If he’s willing to come and present to the Planning Board to go through this review process, I think we can make a lot of things happen,” Hsueh said. “He has to be able to represent what kind of benefits the township will be able to get. There are a lot of amenities, infrastructure improvements, that will have to be part of it.”
Hsueh said based on what Goldin has said in the past, he thinks the developer has “spent a lot of money with a lot of experts doing a lot of study.”
“We have been waiting since March, 2009” for open dialogue, Hsueh added. Instead, InterCap chose to file litigation.
“Since InterCap does not have zoning that is economically viable, it has nothing to lose,” Hoff said.
Council’s Response to Goldin. Goldin’s advertising campaign has caught the attention of the Township Council members, who called the literature “misleading.”
During the May 3 meeting, council members said they had been receiving E-mails from residents in which they referenced the InterCap lawsuit and complained about the appearance of downtown Route 571.
However, the InterCap lawsuit has nothing to do with Route 571, they said, and residents were being misled. In response, council members talked about submitting a letter to the editor to explain why the InterCap advertisement is misleading. “People are linking the way Route 571 looks and the lawsuit together,” Councilwoman Diane Ciccone said.
Councilman Charles Morgan said he was concerned because the council and Mayor Shing-Fu Hsueh had come to an agreement that any press releases and information sent to the public would be sent out as a joint effort between the two bodies of government. The mayor, however, sent a letter to the editor in response to Goldin’s advertising campaign without the council’s joint signature. It gave the impression that the two bodies were not on the same page, he argued.
Council President George Borek said he did feel the message would be stronger as a joint effort, and council decided to consult the mayor before sending its letter to the editor.
Councilman Kamal Khanna asked whether the pending letter to the editor would be out of date if a settlement were negotiated by then. Herbert said it would not. Responded Ciccone: “Regardless, there is a concerted attempt by someone who is suing us to bully us,” to try to get residents to pressure the township to settle based on an issue that is not pertinent to the lawsuit.
Morgan said the advertisements could have hurt the council’s willingness to even consider a settlement. He said the council has not even had the chance to review the latest settlement offer to determine the costs of settling versus the costs of furthering the litigation process.
After the meeting, Hsueh said there was “no such thing as a settlement” pending. “My statement was very clear and simple: we are waiting for them,” a reference to his earlier calls for Goldin to go through the Planning Board process under the current redevelopment plan.
Since the meeting, however, the Mercer County Association of Realtors has submitted a letter (see page 2), saying that the content of its letter to the editor was used by InterCap in the advertisement without the organization’s knowledge and does not accurately represent its views.
