Governor Sherrill: Don’t Give $75 Million of Tax Money to a Billionaire Swiss Company To Repair Their Asbury Park Building. Let Them Use Their Own Money.

The Governor, through the New Jersey Economic Development Authority (NJEDA), is considering awarding a $75 million tax credit—paid for by New Jersey taxpayers—to a multibillion-dollar private equity company based in Switzerland. 

They don’t need our money; they’re just insisting on having it.

That Swiss company breached contracts with the public and is now asking the public to pay for their breach.  No one should be allowed to use taxpayer money to pay their debt to the taxpayer.  This letter will detail how this outrageously unwise spending  will fail.

The building at issue is the Convention Hall complex in Asbury Park.  A desire to save it is laudable. I’ve invested years in the effort to save it.  

Aside from the unfairness to taxpayers, awarding tax credits to foreign billionaires won’t guarantee that Convention Hall is restored. Based on the developers' history, they will either fail to complete the project or fail to operate it in a way that justifies extraordinary public investment. In fact, there is good reason to question whether it will reopen at all under their ownership.

The NJEDA “Cultural Arts Facilities Expansion” program (CAFE) has only given tax credits to two types of entities: Local non-profits and municipalities.  Both work to save historic structures;  neither can otherwise find the money to save their buildings.

• NEVER has CAFE tax credits been given to a for-profit company. 

• NEVER have they been offered to billionaires who have the money to save their own building. 

• NEVER have tax credits been used to pay off a private company’s breach of a pre-existing contract.

• NEVER has taxpayer money subsidized the wealth of foreign companies, nor should it.

Madison Marquette, the company seeking these credits, is the U.S. real estate arm of Switzerland's Capital Guidance. Madison Marquette reports managing $6 billion in U.S. real estate assets. Capital Guidance is privately held, operates across eight business sectors with offices in six countries, and is likely worth substantially more.

New Jerseyans are carrying a budget deficit.  School funding is a mess.  Property taxes are a plague. Young people can’t afford a house.  Pensioners haven’t received a COLA increase in 15 years, wiping away 48% of their purchasing power.  We have 50 “food deserts” and 1 in 10 families experience food insecurity during the year.

And you want those New Jerseyans to fund foreign billionaires?  What’s next -  a fundraiser for Donald Trump?  Should we check with Musk, Bezos and Buffett to see if they need any walking around money?  Good grief.

Right in Asbury Park we have the Westside Community Center that served generations of Black children in the poor side of town, and it’s been shuttered for years.  A non-profit is working to re-open it.   The history of Asbury’s westside being ignored by government isn’t disputable. At a recent City Council meeting about the beachfront buildings attended by 200 people, the Mayor noted almost zero Black faces.   Helping billionaires is not a priority for poor people.

Must the Black community lose again?  Imagine how they’ll feel when you hand foreign billionaires $75 million while they toil in the sun trying to open a facility for local kids.  That’s the type of government disregard that led to the 1970 riot.  Those same residents voted for you by a near 100% margin, Governor.  Don’t stab them in the heart with a Swiss Army Knife now.

Do not let the Swiss present these tax credits as a binary choice between saving Convention Hall and destroying it.  The building will be saved without them.

Madison Marquette and their billionaire partners (ironically named Asbury Partners) signed contracts to save these buildings 24 years ago.  In exchange we let them build ugly million-dollar condos, eminent domain our neighbors, take money from our schools with PILOTS to pay for their infrastructure and gave them many more perks.  The people delivered. 

In exchange, the developers defaulted on repairing our two historic structures, Convention Hall and the Casino,  and shuttered both. 

The cost to repair Convention Hall after two decades of developer neglect is now $123 million.  If they sell these tax credits they will net about half that.  Considering their track record, it is highly unlikely they follow through with the other $60 million.

For collateral they presented the NJEDA with a letter from a bank with the word “non-binding” prominently featured at the top.  They’ve done nothing to earn our trust, and everything to earn our skepticism.  

I can show you two decades of City Press releases and statements as recently as this year, calling this company ineffective, impossible to work with and having a “shocking disregard” for this very building.  The City has 3 pending default notices against them.  Is New Jersey really going to make this highly speculative bet on foreign billionaires who already defaulted on taxpayers the first time around?

Add this to your thinking:  Of the 8 boardwalk buildings for which they paid a combined $1.00,  Convention Hall is separately incorporated as a “disregarded entity” under the IRS tax code.   Why?  So they can walk away from it and not lose their other buildings.  Governor, you’re betting the people’s money on that?  We are skydiving but only the developer has a parachute.

Right now the developers are holding a gun to Convention Hall like a kidnapper looking for ransom – “Give us your tax money or we’ll knock it down.”

No they won’t. Don’t get bluffed out of the pot. I can show you the recorded history that Convention Hall was built as a “loss leader.”  It never made money even in its heyday. The developers knew that when they bought it - that’s why they incorporated in a way that lets them abandon it, and they will.  Their plan was always to build the condos and leave.

When they leave and a non-profit takes over Convention Hall as it should, feel free to give those tax credits Governor, and the New Jersey community will be behind you 100% when you do.

According to the Mayor, NJEDA is acting on this at their August 20 meeting, so let the Governor know your objection before then.  Also you can zoom attend the NJEDA meeting.

You can upload this letter to the Governor here: https://www-njlib.nj.gov/GOV_TRANS_APPLICANTS/BTCustomServlet

Or write to her:

Office of the Governor PO Box 001Trenton, NJ 08625-0001

Or fax: (609) 292-3454

Or call her:  (609) 292-6000