Union County considering litigation over TTF shutdown

UNION COUNTY, NJ — Union County has served a Notice of Claim against the New Jersey Department of Transportation due to the continued shutdown of several road and bridge projects resulting from Gov. Chris Christie’s Executive Order No. 210.

New Jersey Governor Chris Christie ordered the shutdown on June 30, after the state announced months earlier that the Transportation Trust Fund would run out of cash by the summer. On July 6, New Jersey Department of Transportation acting Commissioner Richard Hammer issued a companion Shutdown Order, requiring all contractors to secure projects and cease active work on projects funded by the TTFA.

July 1 was the start of the 2017 fiscal year — the date when all revenue from the state gas tax was used to pay off the state’s debt, thus leaving no cash for new construction projects. The fund is now at its borrowing limit.

Issued on July 8, Executive Order 210 halted work on projects funded by the Transportation Trust Fund Authority throughout the state.

Union County Freeholder Chairman Bruce Bergen said in a statement that the county made the move in the best interest of the county’s residents. “Union County has taken this initial step in order to try to protect our residents and businesses from the disruptive consequences of Executive Order No. 210,” he said. “Again, I urge Gov. Christie to work with the Legislature to provide sufficient funding for the Transportation Trust Fund, and bring this period of delay and uncertainty to a swift closure.”

Executive Order 210 has halted work on three county bridge reconstruction projects and two rounds of annual road resurfacing projects.

The Notice of Claim, issued by the Union County Board of Chosen Freeholders and sent to the attorney general, the Department of Treasury and the Department of Transportation, listed in its notice several of the specific projects that have been shut down due to Christie’s executive order. Some of the projects include the Madison Hill Bridge in Clark, the Mountain Avenue Bridge in Springfield, Gordon Street Bridge in Roselle and several resurfacing projects.

Moshood Muftau and Robert Barry, attorneys for the county, wrote a letter last week to the NJDOT stating its intentions. “It is our belief that the state breached its contract with the county of Union to provide the allocated funding for the enumerated projects,” stated the letter. “The state’s action is expected to cause demobilization and reassembly costs — as yet undetermined — and will result in unnecessary and unforeseeable delays in the completion of the projects in the county of Union.”

Back in July, the New Jersey Association of Counties urged state leaders to restore the TTF. In a statement released by the NJAC, Executive Director John Donnadio said in a statement that he was calling on state leaders to reach a fair and equitable compromise on reauthorizing the “insolvent” TTF, as county governments across the state prepared to shut down and delay more than $90 million in critical road and bridge projects. “The unprecedented shutdown of all work funded by the TTF is forcing county officials to cease operations at ongoing projects and delay new shovel-ready ones that will cost valuable taxpayer dollars as contractors will undoubtedly seek costly delay claims and remobilization costs for lost time on the job,” said Donnadio.

County and municipal roads and bridges carry more than 55 percent of the state’s overall traffic, and depend on approximately $190 million each year in local aid allocations from the TTF to mitigate the reliance on the collection of property taxes.

Counties alone have an annual need of approximately $565 million to operate and maintain an estimated 6,775 centerline miles of roads and more than 7,140 bridges. Counties must also make vital capital improvements of approximately $2.85 million to repair, replace and rehabilitate functionally obsolete and structurally deficient bridges and culverts.

Donnadio said that it is imperative that the state restore local aid allocations immediately. “State leaders must act now to reach a compromise on a stable, dependable and long-term source of dedicated funding for the TTF, and to restore local aid allocations as county and municipal governments continue to struggle with delivering essential services in a cost-effective manner,” he said.
Bergen told LocalSource in an email that he is concerned about the long-term effects of the freeze on TTF projects. “As of this time, none of these projects are abandoned or cancelled, but the longer the freeze continues, the worse the potential long-term effects,” he said. “We are hopeful that a solution will be reached in Trenton in the near future so we can begin to assess the damage and reschedule these jobs.”

Bergen said that the impact of the stalled projects can be felt in several different areas of the county. “The most immediate is the Madison Hill bridge job in Rahway/Clark, which has squeezed four lanes of traffic into two lanes for purposes of the repairs, and that situation continues to affect traffic in that area,” said Bergen. “Obviously, the longer the job is shut down, the longer the public is inconvenienced. We also had purposely planned the replacement of the Mountain Avenue bridge in Springfield, less than a block from Dayton High School, to be done during the summer when the inconvenience would be less. That job will now either have to be postponed until a year from now, or done during school time.”

Last week in Union, construction workers staged a protest on Stuyvesant Avenue, calling out Christie for halting transportation projects being funded through the TTF, along with the fact that talks of replenishing the fund fell through. According to Union Mayor Manuel Figueiredo, two of those projects are in Union, on both Walker and Washington avenues. “Both of these are major arteries to two of our schools and the unfinished work poses a safety risk to our residents and the students,” Figueiredo told LocalSource. “The halt in these projects was only supposed to last a couple of weeks, but it has significantly extended itself. As such, the township has chosen to move forward with these projects despite the directives of the governor’s office in the interest of the safety of our residents.”

Linden Mayor Derek Armstead told LocalSource that the TTF’s depleted funds have affected Linden adversely. According to Armstead, a project that would have built the Carteret Extension Road off the turnpike has been tabled. The road would have diverted heavy truck traffic from neighborhood roads throughout Linden. Now, said Armstead, the heavy traffic continues to stream into residential areas of Linden. “We were relying heavily on the TTF to see that come to fruition,” said Armstead in a phone call. “When it was removed, it affected us tremendously. This is an economic issue and a safety issue.”

According to Armstead, the funds allotted for the extension road literally went south. “They took the money that was supposed to go to our road project and used it for some other project in south Jersey,” said Armstead.

Bergen discussed the possible litigation on the part of both Union and Hudson counties. “Concerning the potential for litigation, Union and Hudson Counties just happen to have been the first two to file a Notice of Claim against the state of New Jersey,” said Bergen. “It should not be considered as in any way reflecting the effect upon these two counties relative to other counties. On the other hand, the Notice of Claim is a necessary precursor to filing suit, but certainly does not require that we do so. That decision will be made at some point in the future, after we ascertain the costs and damages suffered by Union County as a result of the EO, and how best to attempt to recover them.”

In general, New Jersey law requires filing a “Notice of Claim” as a prerequisite to seeking damages through litigation from a public entity. Several counties plan on petitioning DOT to continue with TTF funded projects to ensure the safety and well-being of residents pursuant to Executive Order 213 executed by the governor on Aug. 17, while other counties have decided to complete critical projects using county funds.

Under Executive Order 213, the state treasurer is directed to make available general funds for expenses determined to be essential for the protection of the health, safety, and welfare of the people of New Jersey.

As the situation lingers and worsens, however, concerns are growing that there will be long-term consequences for local property taxpayers across the state. “The unprecedented stoppage of all work funded by the TTF has forced county and municipal officials to terminate ongoing projects and postpone new shovel-ready ones that will cost valuable taxpayer dollars in delay claims, remobilization costs, and litigation expenses,” Bergen said, echoing Donnadio’s position.

Hudson County has also served the state with a Notice of Claim, with Passaic County considering the move as well.

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