Environmentalists previously called the legislation weak in oversight while developers called it too restrictive.Gov. Jon S. Corzine signed bill A-2650, the so-called EnCap Reform Bill, into law on Monday. The controversial legislation requires businesses receiving more than $50 million in financial assistance to file annual audited financials statements with the state treasurer.
Environmentalists previously decried the legislation for allegedly weak oversight while developers called it too restrictive.
Calls to Michael McGuinness, chief executive of the New Jersey chapter of industry association NAIOP, for comment were not immediately returned.
The legislation was prompted by a failed plan to remediate a Lyndhurst landfill and build housing and a golf course on the land. The EnCap project collapsed when developer EnCap Golf Holdings LLC in East Rutherford could not pay its debts. EnCap filed for bankruptcy protection in May 2008 after receiving more than $315 million in combined financing from state and county sources.
Under the new law, public entities that provide financing will reserve 10 percent of the total approved funds for projects until they are complete. Furthermore, private businesses receiving assistance must spend at least $1 for every $5 in public funds received.
AIG is honoring obligations to clean up the site, according to Corzine. ÂHad these safeguards been in effect prior to EnCap, the project would have been shut down at the first sign of trouble,Â he said in a statement.
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