In a perfect world, loans would all be paid back and paid back on time. People, however, do run into problems managing their finances. That said, in a most imperfect world, it would be assumed that a well-established corporate/government entity would pay on obligations. The Middlesex County Improvement Authority has shown this not to be the case. As the Press of Atlantic City reports, the MCIA has not paid $1 million in “principal and interest” to the Casino Reinvestment Development Authority. The $1 million only reflects a small percentage of the money in question here. The total of the loan is in the $20 million range.
The current fiscal problems are not new. Over the past five years, the MCIA has not being staying current on payments. The entity is roughly $7 million behind in its payments, which is not exactly something the lender wants to deal with.
At the center of the controversy is the New Brunswick Hotel known as The Heldrich. Loans and bonds funneled money into the hotel with the hopes the establishment would become a fantastic money maker for investors and a good source of tax revenue for local and state governments.
This has proven not to be the case. Revenues have been slim and the hotel is not generating much in terms of funds.
The New Brunswick Development Corporation (DEVCO) developed the hotel and conference center. Devco is a nonprofit entity that has invested in – and achieved success with – various urban redevelopment projects in New Jersey. Other DEVCO projects include the Rockoff Hall University Apartments and Civic Square Public Safety Building of Middlesex.