A Free Public Library - Broken Promise?

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A Free Public Library - Broken Promise?

May 14, 2020 – There has been a lot of recent “chatter” about the cost and financing of Holmdel’s new Public Library. Then things got excited at the Township Committee meeting on May 12th.

Critics, including Committeeman Tom Critelli, claimed that Mayor Greg Buontempo, who was also Mayor in 2017, had “broken a promise that the library would cost taxpayers nothing.”

Background

Over the years, the library has outgrown the cramp quarters in the basement of the Holmdel municipal complex at 4 Crawfords Corner Road. In addition, the Township was looking for more space to expand for both the Municipal Court and the Police Department.

As part of the redevelopment of the old Bell Labs property (now known as Bell Works), Somerset Development and Holmdel Township agreed to include a Public Library at the building as part of the Redevelopment Agreement signed in 2014. Specifically, the Public Library was defined to be no less than 20,000 square foot space provided rent free to the Township with the proviso that the space is in as-is condition without any tenant improvement. The tenant fit-out for the space was to be at the sole expense of the Township.

$2 Million Bond Ordinance – February 2017

In the ensuing 2+ years after the signing of the Redevelopment Agreement, there were discussions and negotiations for the lease agreement of the Public Library. By February 2017, sufficient details were worked out for the Township Committee to pass ordinances to sign the library lease and for the authorization to issue a $2 million bond for the fit-out of the space.

During the public comment session on these two ordinances, then Mayor Buontempo acknowledged a $1 million donation spread over 20 years by Somerset to defray the cost of the library fit-out. He said that the goal is to cover all the cost for furnishing the library through fundraising efforts so that that “hopefully net-net, [at the] end of the event, the Township gets a brand-new library and a new learning center and has zero impact on our residents.”

Then Deputy Mayor Pat Impreveduto, who was very involved with many of the negotiations with the developer, emphatically said that he was surprised that people are even questioning how did we get this. He went on to say that “We worked hard to get this. We get a free gift, a free library, brand new space, brand new everything, $1 million, $50,000 a year for 20 years. It’s kind of a surprise to me, if I were sitting out there, I’d be applauding this Township Committee for doing what we’ve done.”

While he did not make any comment at the meeting, former Mayor Hinds said that “It’s really important to us,” and that “It’s a home run for the town” in a Two River Times article published on January 2, 2017. Critelli and Committeeman Mike Nikolis did not make any comments, but voted affirmatively, resulting in a unanimous 5-0 vote for the $2 million bond ordinance.

Township Committee Meeting – May 2020

During the discussion for a resolution to accept a donation of equipment to the Holmdel Library Foundation at this week’s Township Committee meeting, Critelli raised the issue of the costs for the Holmdel Library. Specifically, he mentioned that the Township incurred or will incur interest costs of $82,300 and $81,959 for 2019 and 2020, respectively. In addition, there is principal repayment of around $130,000 for 2019 and 2020, respectively. Critelli claimed that Mayor Buontempo broke a promise that the library would have no cost to the taxpayers.

While Critelli acknowledges the $1 million donation promised by Somerset Development, he appears not to take this donation into account. Thus far, the Township has received the promised donations. Therefore, including the year 2020, there is $200,000 in donations by Somerset that should be net against the interest costs and repayment of principal.

More importantly, there is a fundamental fact that is being conveniently ignored, intentionally or not, by detractors in the discussion of the cost of the library. There has been a crying need to expand the library for years coupled with the need by the Municipal Court and the Police Department to expand. The 2014 Redevelopment Agreement that granted 20,000 square feet rent-free space for 30 years allowed Holmdel Township to achieve both critical needs at the same time.

Back in 2017, Impreveduto stated that “the town is saving $33 million over the 30 years” for the rent it will not have to pay for the space at Bell Works. It’s not clear how Impreveduto arrive at his figure, but what we do know is that currently, Bell Works is asking $32 to $35 per square feet of office space.

Some of the early tenants were able to lock in office space at around $24 to $28 per square feet. The library is retail space on the ground floor, so it’s likely to command a premium rent. However, for simplicity's sake, even if we assume rent at $25 per square feet, Holmdel Township saved at least $500,000 per year of rent it doesn’t have to pay. So, including the year 2020, that’s a savings of $2 million thus far; compared with the average “net” cost of $112,000 per year for the past two years.

The new Holmdel Library is generally hailed as much needed. It is in a space that seems to be enjoyed and used by many residents prior to the current coronavirus pandemic. It's probably a safe bet that if they have to comment again, both Impreveduto and Buontempo would choose their words more carefully when referring to the 30-year rent free library.

Clearly, there is a cost related to the interior improvements needed to make the space usable as a library. This is true for any other space that the Township selects for the new library location. However, it pales in comparison to the rent-free savings (a savings of more than $30 million over 30 years if the figure by Impreveduto is to be believed) and is further offset by the $1 million donation from Somerset Development, even if that donation is spread over 20 years.

Interesting Timing

Critelli has been under pressure recently regarding a $10,000 payment that his company Danitom received. Critelli signed a release from all liabilities for a $30,000 claim settlement with the Township in April 2013 related to storm damages. Despite this, shortly after he joined the Township Committee in 2014, a payment of $10,000 was paid to his company Danitom even though it had no contractual agreement with the Township and did not perform any services.

For more details, see https://betterholmdel.wixsite.com/home/post/more-than-meets-the-eye

Who is the lawyer representing Critelli against the Township in this matter? Vicky Flynn. The same Vicky Flynn that is a candidate running against Mayor Buontempo in the Republican primary race scheduled for July 7th.

So, it’s interesting that Critelli would selectively use cost figures to criticize Buontempo at the Township Committee meeting. Those costs, before savings of at least $500,000 annually in rent and before the $1 million donation by Somerset, are a direct result of the improvements needed to make the space useable and was funded by the $2 million bond. The ordinance for the $2 million bond was publicly discussed and unanimously approved in 2017 by all five members of the Township Committee including Critelli with no words of dissension.