BLOOMFIELD, NJ — A Newark Superior Court trial decision in June set the price Bloomfield must pay for the historic train station property on Lackawanna Place, but that price is increasing because of interest payments.
The 5-1 jury verdict, by a six-member jury, determined that the township, which condemned the property and holds title to it, must pay the previous owner $2.9 million. The township is appealing the verdict. But by the time the appeal is expected to be heard, payment for the land will be approximately $3.2 million.
According to court papers, the township already owes interest payments of $208,877.68 more than the $2.9 million the jury said the property is worth. This is because interest payments began retroactively, from the day the jury verdict came in, to the day the township began condemnation proceedings in June 2012.
According to Kevin McManimon, the attorney representing Bloomfield, the appeal should be heard by the courts sometime during fall 2017.
The parcel is a .6 acre slope that abuts the NJT train station across from the Glenwood Village downtown redevelopment project. The station provides a Midtown Direct line to Manhattan.
Interest payments began June 26, 2012, the day the township filed condemnation papers with the court.
The township had condemned the property, owned by Bloomfield Daval Corp., to acquire the historic train station which has an NJT-owned, underground tunnel to the eastbound tracks. The township wanted the station and tunnel reopened as a pedestrian walkway and had the land appraised for $440,000 and deemed undevelopable.
This money was deposited on Dec. 11, 2012, with the clerk of the Newark Superior court, according to court papers. But the principal of Bloomfield Daval Corp., Howard Haberman, also had the land appraised at $3.2 million and developable. He envisioned a mixed-use development on the site, but never submitted plans to the Bloomfield Planning Board. Haberman rejected the offer of $440,000 as full payment for the property but withdrew the money that was deposited with the clerk, according to court papers.
Compensation to Haberman, should the appeal by the township be rejected, would include 2.5 percent interest on $2.9 million from June 26, 2012, until Dec. 11, 2012, which is the date the $440,000 was deposited.
From Dec. 11, 2012, to Dec. 31, 2012, an interest rate of 2.5 percent was paid on $2.46 million which is $2.9 million less the deposit of $440,000.
But beginning in 2013, the interest rate decreased.
According to court papers, for the year 2013, the interest rate was 2.25 percent on a balance of $2,496,541.10.
For 2014, the interest rate was again 2.25 percent, on a balance of $2,552,713.27.
For 2015, again the interest rate was 2.25 percent, on a $2,610,149.32 balance.
From Jan. 1, 2016, to June 3, 2016, the day of the jury verdict, the interest rate was 2.25 percent on a balance of $2,668,877.68.
The court document said the post-judgement interest rate would be in accordance to the law. On the NJ Courts website, that rate is still 2.25 percent provided the amount of compensation exceeds $15,000.
This would mean that on Dec. 31, 2016, the township would owe $2,728,926 above and beyond the $440,000 it has already paid.
In the event that the appeal is granted by a three-member panel of judges, the matter of how much the township must pay Bloomfield Daval Corp. will go to a new jury. McManimon has said that testimony favorable to the township — stating that the land cannot feasibly be developed — was excluded from the trial by the judge, and that Bloomfield was not given a fair hearing that the land is worth far less than $2.9 million.