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Canal Crossing pilot: council hears financial analysis and debate over 20% affordable housing, remediation and proposed 10% school share
Summary
Deputy Mayor Pod and the administration presented a Canal Crossing redevelopment pilot with two mixed‑use buildings, 20% affordable housing, remediation of contaminated industrial land, a new park and a 30‑year pilot/abatement proposal. Independent adviser Tom Banker said the project is likely infeasible under full taxes but feasible under the proposed pilot; the administration also proposed sharing 10% of pilot revenue with the school district.
Deputy Mayor Pod and independent financial adviser Tom Banker made the administration’s case on June 8 for a Canal Crossing pilot that pairs a 30‑year tax abatement (pilot) with negotiated public benefits including 20% affordable housing (a portion at 30% AMI, which the administration said would produce rents under $1,200/month in many unit types), a new roughly 30,000‑square‑foot Garfield Park, transit‑oriented density near the Garfield Avenue light rail station, 100% union construction labor and remediation of historic hexavalent chromium contamination on the site.
Tom Banker (Banker Group) presented a pro forma analysis concluding the project would be unlikely to attract private financing if required to pay full property taxes because high costs — prevailing wages required by EDA participation, remediation and installation of street/water/sewer infrastructure — depress returns. “It is our opinion that this is not economically feasible to be constructed under full property taxes,” Banker said, and that the staged pilot structure the administration negotiated would make the two‑building project financeable while still yielding a net positive municipal revenue stream over 30 years.
Banker projected a stabilized annual pilot (municipal share) of approximately $1.85 million and a municipal receipt of roughly $88 million over the 30‑year term; the administration’s companion ordinance would dedicate 10% of pilot revenues to a school infrastructure capital fund. The administration estimated that a 10% school share of the Canal Crossing project would amount to roughly $8.8 million over 30 years. Banker said the developer’s negotiated commitments to build the park, extend the Morris Canal Greenway and complete on‑site infrastructure before final certificates of occupancy are material concessions from the base proposal.
Council members asked detailed questions about remediation and monitoring; administration staff pointed to a court‑appointed site administrator and a public document archive (chromecleanup.com) for monitoring reports and progress updates. Council members also pressed for the developer’s pro forma, the full financial model, a parcel‑level map of remediation status and an analysis quantifying projected school‑child generation. Using the 2025 Rutgers “Who Lives in America” methodology cited by the adviser, the administration estimated about 66 school‑age children at full occupancy across both buildings, with about three‑quarters from the affordable units.
Opposition and community groups raised concerns about long‑term environmental safety and asked for air monitoring during construction and ongoing remediation reporting. Several council members asked for a complete list of pilots to which a retroactive 10% school share might apply and requested administration estimates of the revenue impact of retroactive application (items identified included Bayfront/Penrose, 701 Newark, the embankment and Sussex Street). The administration agreed to provide those figures and the project's underlying pro formas to the council for further review.
Next steps: the pilot and the school‑share ordinance remain on the council calendar for further hearings; administration promised regular audits, public outreach and documentation of remediation monitoring and financial schedules.
