New Jersey Transit pushes battle vs. mobster's kin

AP News
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Posted: Nov 12, 2014 2:24 PM

NEWARK, N.J. (AP) — The canceled rail tunnel project under the Hudson River that has already cost New Jersey hundreds of millions of dollars could wind up enriching the family of a convicted mobster to the tune of millions more.

New Jersey Transit is embroiled in a court battle with the family of Carmine Franco, a Genovese crime family member nicknamed "Papa Smurf," over a two-acre parcel of land near the northern New Jersey waterfront that was to have been used for a roughly $9 billion transit project. The Access to the Region's Core project was scrapped in 2010 by Gov. Chris Christie over fears of cost overruns.

NJ Transit acquired the land in early 2010 by condemnation for about $1.6 million, but the Franco family went to court seeking higher compensation. In 2012 a jury said the family deserved $8 million, and NJ Transit is appealing the award.

At its monthly board meeting Wednesday, the agency voted to approve up to $150,000 to pay for ongoing legal bills to continue the Franco case. It has already cost the agency about $310,000 in legal fees.

Franco was sentenced in May to a year in prison. He had pleaded guilty in New York to racketeering involving his role in a waste-hauling operation despite being banned from the industry for previous convictions.

It's not clear whether the property would be used for a future tunnel project such as Amtrak's Gateway project, a massive rail redevelopment initiative that is considered at least 10 years from being realized. NJ Transit executive director Veronique Hakim said Wednesday Amtrak hadn't approached her about the parcel.

"We haven't determined a final use for that property," she said. "We don't know what the alignment of the new tunnel is going to be, but obviously keeping our options open for the region is an important initiative."

NJ Transit initially offered to pay the Franco family about $934,000 for the property, an industrial site that sits in parts of Weehawken, Hoboken and Union City, but later revised the figure to $1.65 million. The agency took possession of the land in June 2010, about four months before Christie pulled the plug on the ARC project.

The price tag for the tunnel project was variously estimated from about $8.7 billion to as high as $13 billion or more and was to be funded by New Jersey, the federal government and the Port Authority of New York and New Jersey. The project was 15 years in the making when Christie scrapped it, and more than a half-billion dollars had been spent for engineering, construction and environmental studies.

After Christie killed the project, the government tried to force New Jersey to pay back $271 million for work that had been completed, but the state negotiated that figure down to about $95 million.