BY CHRISTOPHER MAAG
Leaders of NJ Transit decided Wednesday to continue their years-long legal fight against the family of a convicted mobster. The agency’s board unanimously agreed to spend up to $150,000 on lawyers to challenge a court decision ordering them to pay $8.1 million to the family of Carmine Franco, who pleaded guilty in May to organizing a Mafia racketeering scam. Franco, known in Mob circles as “Papa Smurf,” is currently in federal prison.
NJ Transit already has spent $310,000 in legal bills related to the case.
The dispute arose from NJ Transit’s attempt to build a $10-billion train tunnel connecting New York and New Jersey. The agency decided it needed to own a polluted, 1.89-acre piece of land on the border of Weehawken, Union City and Hoboken, directly above the tunnel’s proposed path.
The property was owned by close family members of Franco, 78 and from Ramsey, a known criminal who already had been convicted twice for mob-related conspiracies. NJ Transit eventually agreed to pay $990,000 for the plot, and took possession in June 2010, according to filed in Superior Court in Hudson County .
Four months later, Governor Christie cancelled the tunnel project.
The fight between NJ Transit and the mobster was just beginning, however. Franco’s wife and sister-in-law, who officially own the land, hired an engineer and an architect to re-imagine the weed-choked plot as the home of high-rise residential buildings with sweeping views of the Hudson River and Manhattan. When possibilities for redevelopment were considered, the land’s value multiplied to $9.1 million, said Paul V. Fernicola, the attorney representing Franco’s family.
A jury in Hudson County eventually agreed, and ordered NJ Transit to pay Franco’s family $8.1 million. NJ Transit appealed, arguing that Franco’s family should not have been allowed to introduce documents in court about possible residential redevelopment of the site, according to court documents.
Then NJ Transit ran out of money to fight the case. In November 2008 the agency allocated $2 million for lawyers working on property acquisitions for the ARC Tunnel. That money was spent, so NJ Transit’s board had to allocate additional money on Wednesday to continue its appeal.
Whatever happens in the court case, NJ Transit will own the land outright, Fernicola said. That means the agency still may be forced to clean up pollution on the site, which was used for years by auto repair, jitney bus and salvage yard companies, according to court records. An environmental review conducted in March 2012 and submitted in court documents found it would cost nearly $2 million to clean and cap pollution on the site.