TRENTON — The state is still having trouble managing 236 lease agreements with private companies who are using public property, according to an official audit that was circulated by environmental groups yesterday. The audit was circulated as controversy grew over a proposed deal announced last week to run a natural gas line through 23 miles of New Jersey parks...
Harry Ally Park, in Bridgwater, is considered open space.TRENTON — The state is still having trouble managing 236 lease agreements with private companies who are using public property, according to an official audit that was circulated by environmental groups yesterday.
The audit was circulated as controversy grew over a proposed deal announced last week to run a natural gas line through 23 miles of New Jersey parks and protected land.
The Office of Legislative Services has lambasted the state Department of Environmental Protection in four audits over the past decade, alleging mismanagement of lease agreements and revenue collection on hundreds of publicly owned buildings, farm fields, park facilities, marinas and utility easements used by private outfits.
The latest audit, released on Dec. 28, cited improvements, but concluded that 112 of 236 leases held by the DEP have expired, although the properties involved are still used by private entities.
The audit was sent today by the environmental group, Public Employees for Environmental Responsibility, along with a letter to the Statehouse Commission urging it not to approve a 24-year lease deal proposed by the DEP with Tennessee Gas Pipeline Co. to run a gas line gas line through the protected Highlands region and several state parks and preserves in Sussex, Passaic and Bergen counties.
In exchange, the state will receive a $45,000 payment to cover the 24-year period of the lease.
"It’s just crazy. It’s a rip-off to state taxpayers and a give-away to a giant energy corporation for an environmentally destructive project at a time when we have no money for our state parks. The state has been mismanaging these lease deals for years, and the taxpayers are the ones who suffer," said Bill Wolfe, of PEER.
The Dec. 28 audit was not as critical as prior reports released in 1997, 1999 and 2004. But it questioned whether fair market value is being charged for use of public property and noted that, while liability insurance is required by all tenants and lease holders, proof of insurance policies could not be found in 17 of 28 lease deals sampled.
"We’re continuing to make improvements in our rent collections and lease tracking by improving internal processes. By pursuing new lease arrangements, we also have increased our revenues since 2006 by $700,000 annually," said DEP spokesman Larry Hajna, adding that $300,000 in unpaid rent and lease payments cited in the audit also has been collected.
"The state is not undercharging for newly negotiated leases," Hajna said, adding that the $45,000 figure on the Tennessee lease deal was reached by an independent appraisal.
The DEP contends the price is based on the fact that the open space land to be used was valued at far less than if the land was privately held and could be developed.
"The public pays hundreds of millions of dollars to protect land from development through Open Space, paying top dollar. Then the state gives it away for pennies to giant utility companies because they base the assessment on whether the land can be developed, not on the profits the utilities will reap from the land," said Jeff Tittel of the New Jersey chapter of the Sierra Club, calling the DEP’s assessment formula faulty.
Tennessee Gas said it will spend up to $2 million to restore wetlands, trees and wildlife habitat affected by the pipeline, which will run next to an existing pipeline and is part of a 128-mile project extending from Pennsylvania and eventually into New York.