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A legal loophole may prevent Meadowlands

Sunday, March 5, 2006

Natural gem’s deed contains a loophole

Staff Writer

The Empire Tract, the gem of Meadowlands open space declared saved last year, may not be so safe, despite the promises of environmentalists and state officials.

The deed to the land includes a clause that could allow construction or other activity on the site.

“That’s not a loophole; it’s the Lincoln Tunnel,” said Stuart Lieberman, a lawyer for Carlstadt, which has raised objections to the Empire Tract deal.

The Meadowlands Conservation Trust, a state-chartered non-profit that holds the deed, says it has no intention of condoning development on the site. Activists fought for years to preserve the 600-acre parcel of reeds in the heart of the Meadowlands.

“You would have screaming from everywhere: You can’t do that!” said Tina Schvejda, the trust’s executive director. “They know that this is the jewel in the crown of the Meadowlands.”

But the deed makes others nervous. The Empire Tract’s former owners are the companies behind Xanadu, the shopping and entertainment emporium under construction at the nearby Meadowlands Sports Complex. The Xanadu deal has been on shaky ground lately, thanks to the financial troubles of the main developer, the Mills Corp.

If the project falls through, some ask, could Mills turn around and develop the Empire Tract, using the clause in the deed as an escape hatch? Or could parts of the Empire Tract be paved over to allow rail access to the Meadowlands or an exit ramp from the New Jersey Turnpike?

“It just shows that [the state] sold the public a bill of goods,” said Jeff Tittel, director of the state Sierra Club. “They got up and said the public benefit of Xanadu is we’re going to get this land for free and it’s going to be a park forever.

“Now actually, if you read the deed, it’s not really preserved.”

It wouldn’t be the first time the Empire Tract deal turned out to be less than billed. As it fought for the right to build Xanadu, Mills suggested that it would donate the Carlstadt land for conservation. When then-Gov. James E. McGreevey unveiled the final deal in 2004, however, it wasn’t quite a giveaway: In exchange for the Empire Tract, the developers got a $27 million break on their lease for the sports complex.

“This land will remain a natural oasis for generations to come,” Susan Bass Levin, McGreevey’s commissioner of community affairs, said at the time.

Mills and its partner, Mack-Cali Realty Corp., handed over the deed to the Conservation Trust last March.

The six-page deed includes a long list of activities banned on the property: construction, paving, waste dumping — basically anything other than keeping the land in its natural state and restoring its degraded marshes.

Near the end, however, is a clause that gives leeway to three parties: the Mills/Mack-Cali partnership, the state Department of Environmental Protection and the U.S. Army Corps of Engineers, whose wetlands rules cover the Empire Tract.

Those three can consent to “activities otherwise prohibited … if, owing to unforeseen or changed circumstances, any of the unauthorized activities listed are deemed desirable.”

The deed gives no definition of “unforeseen or changed circumstances.” And the clause makes no mention of the owner of the site, the Meadowlands Trust.

The Record showed the deed to three attorneys and three environmentalists familiar with open-space deals, none of them involved with the Empire Tract. Most found the language vague, though not necessarily a threat to protecting the land.

“Certainly among the environmental groups I’ve worked with, the deeds have not had that sort of provision where, ‘If we think of something otherwise, we can come back and change the terms,’ ” said Glenn Geiger, a Florham Park real estate attorney.

“It’s a pretty broad provision,” said James Wyse, a Warren attorney who has worked with land donors and preservation groups. “Depending on how one interprets the overall document, it could potentially be used to nullify the protections.”

Bill O’Hearn of the non-profit Highlands Coalition called the wording “unusual” and said it “doesn’t quite sit right with me. I have not seen that before.”

It’s not unheard of for a former owner to retain some say over what happens to open space they’ve given up, attorneys said. For example, a conservation group might grant a donor hunting privileges on part of his old property, if that’s what it takes to acquire the land.

But such provisions are usually narrowly drawn, observers said.

Still, O’Hearn, Geiger and others who reviewed the deed didn’t see much room for mischief. The Meadowlands Trust, as owner of the Empire Tract, could veto any attempt to use the property, they said, even if the group isn’t mentioned in the clause.

The wording in the deed surprised officials with the Meadowlands Trust. “Boy, that is a blanket statement,” Schvejda said when asked about the clause. The group’s chairman, Bill Sheehan, said he had never seen the deed, leaving it to his lawyers to protect the land.

But both said there was no loophole. Although it isn’t explicitly stated in the deed, only the trust could propose prohibited activity, they said. Mills, the DEP and the Corps of Engineers could only approve or deny such a request. The trust, dedicated to preserving open space, would never suggest such a move, they said.

“The land is going to stay in its natural state in perpetuity,” said Sheehan, who also leads the group Hackensack Riverkeeper.

The trust is run by seven board members, most appointed by the governor. By law, four of the trustees must come from a list suggested by established environmental groups such as the Audubon Society. It’s not a board that could be filled with political cronies, Schvejda said.

A spokesman for Mills, Michael Turner, said the clause was merely a formality included to account for the rights-of-way retained by the turnpike, which cuts across part of the tract, a natural gas company, which has a pipeline there, as well as other utilities. With the trust controlled by environmentalists, no development will ever occur, he said.

An official with the Corps of Engineers said the agency had no intention of allowing development on the property. A DEP spokeswoman declined to answer questions about the deed.

The chairman of the New Jersey Sports and Exposition Authority, which led the Xanadu negotiations, said the talks never envisioned anything other than a preserved Empire Tract.

“If someone construes that clause to be a loophole, I think it’s strictly an interpretation that was not the intent of the authority,” Carl Goldberg said.

Critics, however, were unconvinced.

“If it’s not going to happen, and it’s never going to happen, then why’s it in there in the first place?” asked Tittel. “The fact that you put it in there says that the McGreevey administration thought that at some point in time they would do something with that property.”

The DEP and Corps of Engineers, run by political appointees, will support whatever politicians tell them to, he said. And even environmentalists can be pressured into supporting bad deals, he said.

“That’s not enough of a safeguard,” he said. “We’ve seen dedicated open space being diverted to build colleges, housing, senior housing, radio towers, cell towers.”

Carlstadt raised concerns about the language as part of a federal lawsuit challenging the Xanadu deal, which the town fears will create traffic and pollution. The suit was dismissed last month, but the borough’s lawyer, Lieberman, said it may appeal.

The “unforeseen circumstances” clause is just too broad, Lieberman said.

“The problem is we’re left to make presumptions about what that deed means,” he said. “There should be no reopener at all. None. Now, you have a reopener that you can drive a Mack truck through.”

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