New Jersey Statehouse

A Superior Court judge has refused to halt to the sale of $250 million in bonds earmarked for a controversial state office construction project in Trenton.

Mercer County Superior Court Judge Paul Innes denied motions to enjoin the sale of bonds to construct two new office buildings to replace the aging taxation, agriculture and health buildings, which would be demolished or redeveloped. But the plaintiffs are seeking expedited review at the Appellate Division, which hears appeals of state agency rulings.

The state Economic Development Authority plans to lease land for the new buildings from the state and to issue bonds to pay for the project. Once state workers move into the new buildings, the state would pay to rent the office space from the EDA. But two suits claim that financing the project through the EDA would wrongly circumvent a state law requiring bond issues to win voter approval in a general election. Opponents have also criticized the locations where the new construction is proposed because the sites are not as centrally located as the three existing buildings.

A group of plaintiffs that includes Assemblyman Reed Gusciora, D-Mercer, whose district encompasses Trenton, filed a suit to stop the office building project on Dec. 18, and Sen. John Wisniewski, D-Middlesex, filed a separate suit to block the plan on Dec. 22. The suits say voters should be allowed to have final say on whether to issue the bonds, and they argue that the state's current debt level is too high. The Gusciora complaint cited Burgos v. State, a 2015 Supreme Court case which called for the Debt Limitation Clause to have a “broad” and “sweeping” scope addressing all types of indebtedness.

Innes said the case belonged in the Appellate Division because it was an appeal of an agency decision, in this case a decision of the EDA, according to Bruce Afran, the lawyer for the Gusciora plaintiffs. Afran contended it belonged at the trial court level because it was a case impacting voters' rights. But Innes felt the two issues were intertwined, said Afran.

At the hearing, Innes cited Enourato v. New Jersey Building Authority, a 1982 Supreme Court case holding that independent government agencies could issue debt without voter approval.

Afran maintained that Burgos invalidated Enourato, but Innes asserted that Enourato is still viable.

Afran said after the hearing that the state's proposed financing for the project requires the state to pay rent on the buildings for the entire term of the EDA bonds.

“Our argument is it's a debt instrument, no different from a mortgage note—they're just stamping the word 'lease' on it,” said Afran, a solo practitioner in Princeton.

Afran said letting voters approve the debt for the project would provide recourse for critics who say the proposed buildings' locations would not contribute to vitality of businesses in Trenton's downtown area.

“The power of the purse is a tool for people to block a poorly thought-out project,” Afran said.

Wisniewski said he disagreed with Innes' reading of case law. “While I respect his scholarship, I believe he took a very conservative approach,” Wisniewski said. The Attorney General's Office declined to comment. Last spring, Wisniewski filed a similar suit over the Christie administration's proposed renovation of the Statehouse, which uses a similar financing model. But that suit was dismissed by a state court judge in June because the bonds were already issued.