Ringwood building project in limbo
Monday, March 12, 2007
By JAN BARRY
STAFF WRITER
RINGWOOD -- A bankrupt developer's legacy has put an office building project in limbo.
The Borough Council won't take over Countryside Lane, a short private street off Skyline Drive, because questions remain about the status of the road, built two decades ago by a local developer who went out of business. The municipal construction code official won't grant a building permit until the road issue is resolved.
And that creates a problem for the office building developers: Construction must start before August, or the project could lose its exemption status under the state Highlands protection law that limits development in the Highlands community.
"We're talking about a good tax ratable to the town," Michael Walker, an attorney and owner of the site, told the council recently in a losing bid to have the private street accepted into the municipal road network. Walker said the office building project was caught up in "a political issue" over the road's status.
The issue was initially brought up by council Democrats, but Republicans took the same stance.
"We shouldn't accept it, so we don't get stuck," said Republican Councilman William Marsala.
At issue is that a survey map of Countryside Lane -- which is paved -- was never provided to the town, and it could cost about $20,000 to have such a map made. In addition, the borough is facing much larger costs of paving two other streets in a residential development after the same developer, Pat Wallace, and a bonding company defaulted.
"We've had this problem with this developer on other sites," said Borough Attorney Joseph Maraziti Jr.
Walker said he understood "the borough's concern about accepting the roadway." But if something isn't done to allow the office building to be built, he added, Ringwood may face a lawsuit.
Borough officials have been weighing a potential lawsuit themselves -- against Wallace and the bonding company.
Wallace built Countryside Lane about 20 years ago to a parcel where he wanted to build a housing complex. A car wash and a building with a day care center received borough approvals to be constructed on that street. Wallace also built the Kensington Wood housing development on a nearby ridge. But, according to borough officials, he didn't finish paving two new residential streets. The cost of that work was estimated by the borough engineer at $300,000.
Both Wallace and the bonding company that guaranteed the work declared bankruptcy, Maraziti told the council in a recent report, so he advised against suing for payment. Wallace's bankruptcy, he noted, is being challenged in federal court by a former business partner and by an investor who won a $1.1 million state court judgment against Wallace.
"This unfortunate situation is a result of the fact that the traditional mechanisms to assure that sufficient funds are available to complete the infrastructure improvements that the developer promised to complete and is legally bound to complete have failed in this case," Maraziti told the council.
E-mail: barry@northjersey.com