NEWARK, NJ - The City Council on Tuesday unanimously approved an amended lease agreement with the Port Authority that would hand Newark an additional $155 million to pay for city services and improve infrastructure projects.
The agreement was initially billed on Monday as additional funds that would help pay for the replacement of the city’s 18,000 lead lines. It comes in the midst of a years-long lead water problem that in August catapulted the city into the national spotlight after the federal government said water filters issued by the city were not working.
But by Tuesday morning, administration officials backed off the notion that the extra money from the Port Authority would be used to aid in the replacement of lead lines for the residents of Newark. The bi-state agency operates Newark Airport, parts of which falls within city limits but not to areas where people live.
Business Administrator Eric Pennington told the council on Tuesday that the additional money could be used for a variety of reasons and did not have to be specific to water projects. In the agreement, Newark would receive an initial up-front payment of $5 million, then $5 million each year for the next 30 years.
The city “may use it for whatever we want to use it for,” Pennington told the council.
In a press release sent on Monday, Baraka’s office said the mayor would announce on Tuesday “that the City of Newark is receiving $155 million in a new lease agreement from the Port Authority of New York and New Jersey to aid in the replacement of every lead service line in Newark.”
On Tuesday morning, Baraka’s administration was less specific about what the money was intended for and clarified that negotiations with the Port Authority on this lease agreement had been ongoing for years, was not new and predates the lead water issue.
“We can add this money to our budget to support city services, make some capital improvement and apply to some debt service,” according to a statement by Baraka in Tuesday’s press release. “I’ve always said the ports and airport were [an] asset for this city that we could better utilize. This money is another example of this city using its own resources to solve our own problems.”
The release then goes on to give background information about the city’s efforts to replace 18,000 lead lines, a project expected to take 24 to 30 months but does not make the same direct correlation Baraka’s office made on Monday.
The additional funds from the Port Authority comes just after the council approved a $120 million loan from Essex County intended to pay for the cost of replacing the lead lines that officials have said would come at no expense to Newark residents.
Council members said they ultimately saw no issue in approving the amended lease which, in part, extends the number of years of the longstanding agreement.
Councilman Anibal Ramos asked Pennington to assure council members that the administration did not rush to settle the dispute because it needed more money to address the lead service problem.
“There was no rush to it,” Pennington said. “We have been working ... to get to a point that makes sense to us.”
Baraka brought up a bill lawmakers are waiting for the president to sign that would allow federal funds be used to aid the city's lead service line replacement program so that it did not have to use as much Port Authority money for that project.
The Port Authority has yet to weigh in on the amended agreement.