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Jersey City Files $400 Million Suit Against Port Authority

Jersey City Mayor Steven Fulop (credit: Jersey City Mayor's Office)

Jersey City Mayor Steven Fulop (credit: Jersey City Mayor’s Office)

JERSEY CITY, N.J. (CBSNewYork/AP) – The Port Authority of New York and New Jersey has been taking advantage of outdated or nonexistent agreements to cheat Jersey City out of hundreds of millions of dollars in property taxes and other payments, according to a federal lawsuit filed Thursday.

Jersey City Mayor Steven Fulop said he filed suit in U.S. District Court seeking $400 million from the agency after months of preliminary negotiations failed to reach a settlement.

“This is not just an issue of the Port Authority failing to pay ample taxes, it speaks to the larger issue of how the politics at the Port Authority have continued to negatively impact the residents of Jersey City and New Jersey,” Fulop said.

Port Authority spokesman Steve Coleman said the agency has no comment on the lawsuit.

The suit alleges the Port Authority manipulated agreements over several decades to avoid payments of taxes, penalties and fees on dozens of properties it owns in the city.

“The Port Authority thinks they’re above any sort of state or local laws and they don’t need to compensate any of their host communities at all,” Fulop told WCBS 880’s Monica Miller.

The Port Authority operates three major New York-area airports, toll bridges and tunnels into New York City, the PATH rail system and the ports of New York and New Jersey, as well as the World Trade Center site. It annually reports revenues in the billions of dollars. Four of its PATH rail stations are in Jersey City, along with the New Jersey entrance to the Holland Tunnel, and a recently opened PATH command center. Part of the ports complex also is situated within the city limits.

Fulop said the agency does not pay real estate taxes on any of its 40 Jersey City properties, which he estimates would have historically yielded about $315 million in additional tax revenue and about $18 million per year. Fulop said 33 of its properties yield no revenue, while seven are subject to making payments to the city in lieu of taxes, or PILOTS, in the amount of about $2.2 million annually, a figure the mayor called “grossly inadequate.”

Fulop said the $400 million the city is seeking “can help our infrastructure, which the Port Authority burdened every single day.”

Fulop said the city would also pursue legal action to block a planned Port Authority redevelopment project to build a $118 million waste transfer station at Greenville Yards if the agency won’t pay the city a host transfer fee to offset the additional costs.

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