The agreement ends months-long wrangling between community residents in the Fairmount section of West Ward, city officials and PSEG over where to put a new switching station, which helps deliver power, in Newark.
“At the end, we were able to come up with an agreement that serves the needs of the community and the City while permitting PSE&G to build a new switching station to assure that existing and future businesses in Newark can be assured of reliable power,” Newark mayor Ras Baraka said in a statement.
Under the deal, PSE&G will be allowed to put a new switching station near the intersection of Central and Littleton Avenues, said PSE&G’s vice president of communications, Kathy Fitzgerald.
In exchange for the switching station, PSE&G will give Newark about $1 million in payments in lieu of taxes every year for 30 years— an amount that would increase by 3.75 percent each year, Fitzgerald said.
While PSE&G will give the city the money gradually, the city could monetize the funds through bonds and receive a lump sum payment, Fitzgerald said.
PSE&G also agreed to change the design of the switching station and decrease its size by about 2 and a half acres to about 3 acres. The excess land would be given to the city of Newark for redevelopment purposes, Fitzgerald said.
Under the agreement the Newark city council approved 7-0 this week, the Urban League of Essex County would use the land or another area to build a community center.
PSE&G would also preference newark residents for construction jobs under the agreement, Fitzgerald said.
“We’re glad that we could make this a win for the city and community and meet PSE&G’s need to build a new switching station to maintain reliable electric service to the city and the region,” PSE&G’s VP State Government Affairs Rick Thigpen said in statement.
West Ward councilman Joe McCallum, who has been negotiating with the utility company and the community groups over the station, said he is currently looking to identify minority contractors and potential employees for PSE&G and other companies to work with.
“We want to use this as a model” for future development projects, McCallum said. “The only way we can move forward is if our residents our getting jobs when people come into the city to do business.”
PSE&G, the Urban League of Essex County and the Fairmont Heights Neighborhood Association have been locked in a public debate over the switching station since last year.
The utility company argued that the city needed a new switching station in order to sustain the power grid. But the community groups questioned the size, location and aesthetics of the switching station.
The residents successfully lobbied Newark’s zoning board last year to deny PSE&G’s variance application to build the switching station.
But then PSE&G filed a petition with the board of public of utilities to overturn the zoning board decision, said Renee Steinhagen, the attorney who represents the League and neighborhood association.
The league, neighborhood association and city became interested parties in PSE&G’s petition, prompting negotiations between all the entities, Steinhagen said.
Steinhagen said the city and the neighborhood groups still have to finalize an agreement over how to handle the excess land PSE&G is giving the city for the community center.
But Urban League of Essex County president Vivian Cox Fraser said she hopes the agreement will help further revitalize the Fairmont Heights neighborhood.
“The residents of that community stood up. It’s important for community members begin able to decide on what happens in that community,” she said.
“When people stand up and communicate what’s important…we can really become effective partners for progress.”
Naomi Nix may be reached at nnix@njadvancemedia.com. Follow her on Twitter @nsnix87. Find NJ.com on Facebook.