EDITOR'S NOTE: We recently received a comment on the post "Remember When" that suggested the 2011 tax abatement agreement, between Gloucester City and the owners of MAG Enterprise/Cheerleaders, had been changed. At first we thought the individual was wrong. After all, we would have remembered a public announcement from the city. Digging a little further we found a number of court documents that indicated there was a new deal. Below is a letter to Gloucester City Solicitor John Kearney asking for an explanation. ~CNBNEWS.NET
William E. Cleary, Editor
Gloucester City News, Publisher Emeritus
Date: February 25, 2013
John Kearney ESQUIRE
Solicitor City of Gloucester City
It has been brought to my attention that on July 17, 2012 the US District Court ruled that the August 2011 agreement between the City of Gloucester City and MAG Enterprise Cheerleaders was moot. (See below)
As you know in 2011 the Court ruled the City Planning Board violated MAG’s First Amendment rights in March 2010 when it refused their request to operate an adult entertainment club at the site. The owner was also granted $159,000 in attorney fees by the judge.
It was reported in area newspapers and on CNBNews.net that the City of Gloucester City appealed the court’s ruling. In August 2011 the Court ruled in favor of MAG. As a result a new accord was made. Specifically MAG was to pay no real estate taxes to the City of Gloucester City for nine years. The settlement also called for the City to pay $35,000 to MAG entertainment who operated the nude dance club. Records show the Club pays $16,400 annually in property taxes. The total value of the settlement was estimated at more than $180,000. The club owners could have made the City pay it’s $157,000 legal fees. By giving the Club the nine year tax break the City avoided having to make a lump sum payment to the owners.
The arrangement called for MAG to upgrade the Route 130 property, adding a deck and exterior improvements. They must also erect a fence as a buffer between its site and nearby homes.
January 13, 2012, Jeffrey M. Brennan ESQ, attorney for MAG filed an affidavit in U.S. District Court, Camden in support of a settlement agreement in the amount of $122,500.53 plus attorney’s fees and costs.
Item 9 of that affidavit reads, “During those communications, I explained to Mr. Kearney that I had researched the feasibility of the proposed abatements and cocluded that they could not be implemented.
Item 10: Under New Jersey’s Five-year Exemption and Abatement Law, NJSA 40A:21-A, et seq., eligibility for abatements only extends to “improvements, conversions or construction” for qualifiying projects, not to land and existing structures like that which exists on plaintiffs’ property.
On January 24, 2012 you wrote a letter to the Honorable Robert B. Kugler, United States District Court stating in part,
“At its January 19, 2012 meeting, Gloucester City Common Council introduced by title and ordinance concerning a tax abatement for the plaintiff’s real property. The ordinance is scheduled for second reading and adoption at Council’s February 16, 2012 meeting. Respectfully submitted, John B. Kearney, Solicitor, City of Gloucester City.
I looked for a copy of that ordinance on the City’s website, and found the following “Ordinance 004, Providing for tax abatement (Cheerleaders) never prepared, never adopted."
Has a new agreement been reached between the City and MAG? If so we like to have a copy of that agreement as we feel the public has a right to know. If the ordinance wasn’t adopted by mayor and council at the January 19, 2012 meeting we like to know why not?
I draw your attention to the following:
THIS MATTER having come before the Court on the motion of Mag Realty, LLC, et al. (“Plaintiffs”) to enforce settlement agreement, against The City of Gloucester City, et al. (“Defendants”) and for the entry of judgment in the amount of $122,500.23 (Doc. No. 59); and the Court having reviewed the facts of this matter and the parties’ briefs; and the parties having reported to the Court that the matters relating to the motion to enforce settlement agreement have been amicably resolved by the parties; and
THE COURT FINDING that Plaintiff’s motion to enforce settlement agreement is moot because the relief sought by the Plaintiff’s motion is no longer being pursued, due to the current circumstances of the matter;
IT IS HEREBY ORDERED that Plaintiff’s motion to enforce settlement is DENIED as moot.
Case 1:10-cv-00988-RBK-KMW Document 64 Filed 07/17/12 Page 2 of 2 PageID: 1220
Date:__7/17/12__________ /s/ Robert B. Kugler_________ ROBERT B. KUGLER
United States District Judge
CC: Gloucester City Mayor William James, Gloucester City Administrator Jack Lipsett, Albert Countryman, publisher/editor Gloucester City News