The non-profit development company behind the $206 million project to build Stockton University an Atlantic City campus was little more than a shell company in 2015, with no staff and a tiny revenue eked out from parking fees, according to its latest tax filing.
The Atlantic City Development Corp, founded in February 2015 by New Brunswick Development Corp’s President Chris Paladino and three colleagues from the Governor’s Commission on New Jersey Gaming, Sports and Entertainment, lost money in its first year and its only revenue came from charging the Knife & Fork restaurant $7,500 for the lease of a parking lot. Route 40 requested the filing from Paladino’s office last year.
The ACDevCo did, however, hold land worth $11.7 million, including a 9.5-acre package it acquired in 2015 for the Stockton project.
“One of the lots had been leased to the owner of the Knife and Fork for restaurant parking for a number of years,” Paladino explained in an email. “We continued the same arrangement with the owners under the existing terms.”
Frank Dougherty, owner of the Knife & Fork, said he is in talks with ACDevCo about buying the property, since he would like to be sure of the future of the restaurant’s parking.
The ACDevCo operated without staff in 2015, the filing shows. Its board consisted of Paladino as president, Christie advisor Jon Hanson as chairman, real estate investor Finn Wentworth as treasurer and Rutgers law professor Robert Holmes as secretary. Not including benefits, Paladino received $557,592 in compensation in 2015 from New Brunswick Development Corp, a separate filing from that entity showed. Even though the filing shows the ACDevCo did not have salary expenses in 2015, it did record $183,605 in legal, accounting, insurance and other costs.
Paladino, Wentworth, Holmes and Hanson co-authored an updated report of the Governor’s Advisory Commission on New Jersey Gaming, Sports and Entertainment in 2014, which conceived of the non-profit development company as an entity that would fund projects throughout Atlantic City, with $10 million a year in financing from diverted Atlantic City Alliance funding.
In an email sent later on Tuesday, Paladino wrote: “It is the plan to make ACDevCo self-sustaining. The AC Gateway Project is providing an initial revenue source through the allocation of development fees to provide operating revenue and seed money for the next round of projects. It is anticipated that ACDevCo will have full-time staff and seek additional development opportunities through a variety of public and private sources to fund new projects.”
Here is a map of the ACDevCo’s property in Atlantic City:
A chunk of that land was acquired with the help of a $10 million loan extended in 2015 at a rate of 1 percent by South Jersey Gas, a spokeswoman for that company said in an email last year. That loan was repaid by ACDevCo in July 2016, according to regulatory filings by South Jersey Industries.
The Philadelphia Inquirer’s Amy Rosenberg reported on Monday that Jingoli & Son, the construction company that was awarded a no-bid contract by Atlantic City Development Corp to build the Stockton project, employs Paladino’s son Connor Paladino. Chris Paladino told The Inquirer, “We’re doing a project that no one else seemed to be able to get off the ground. (Connor Paladino) wasn’t hired because they do work for us. It’s a big company.”
(This story was updated at 8.30 pm to include a detail from an interview with Frank Dougherty – paragraph five – and the comments emailed from Paladino’s office on the future of ACDevCo in paragraph eight).