Mount Holly blight fight grinds to a halt

After about half a dozen years of litigation, Mount Holly has run out of money trying to get people to move out of an impoverished neighborhood that the township designated for redevelopment.

The redevelopment project in the blue-collar Burlington County township has emerged as an example of all that can go wrong with the controversial solution to blight, township officials and residents say.

Township Manager Kathleen Hoffman said in a recent interview that the township was saddled with $18 million in debt for a project that has yet to be built.

For years, the town issued bonds to pay for the acquisition of the rowhouses in Mount Holly Gardens, their demolition, the legal costs, and plans to build a new neighborhood with townhouses and apartments priced for wealthier families, and retail space.

But recently, the manager issued a "cease and desist" order to everyone involved in the project.

That includes Jim Maley Jr., the lawyer who has racked up $937,000 in legal fees to fight residents who have refused to move, the relocation company that has been negotiating with them to buy their homes, and the demolition company.

"We don't have the money," Hoffman said, releasing a loud sigh. "Everything has come to a standstill."

Fewer than 70 of the 330 rowhouses are still occupied. The holdouts won a 2011 ruling in federal court that they have grounds to seek a trial to determine whether the effort to force them out of the Gardens is discriminatory because most of them are minorities.

"The people that are there, I've said a thousand times over, those aren't the people who created the problems," Mayor Ryan Donnelly said. He said the town had wanted to remove a crime-ridden neighborhood, where illegal drug sales were common, but the "ones who maintained their homes unfortunately were lumped into the larger project."

In a break with past practice, Hoffman said she now was planning to hold meetings with the holdouts to discuss giving them replacement homes, or offering other alternatives. "I'm hoping we are going to settlement."

Olga Pomar, a South Jersey Legal Services lawyer who represents about 20 of the holdouts, said she was excited to hear this, but as of last week still had received no official word.

"We've been saying we want to go to mediation, or arbitration, three or four years ago," Pomar said. "But the township refused to open up any settlement discussions."

Then, in November, Maley wrote her a letter saying the town wanted a written list of settlement demands first. He also wanted consensus from her clients.

Pomar responded, but said she was still waiting.

Maley, who is also mayor of Collingswood, did not return calls or e-mails seeking comment.

The problem for many of the holdouts, Pomar said, was that many had already paid off their mortgages, and the money they were being offered was too little for them to buy another home. They also could not afford another mortgage.

Her clients, she said, "have been living under the fear that their home is going to be taken from them since 2003." When eminent domain was threatened some years later, she filed court action.

Since then, the conflict has lingered in court even as the town demolished rowhouses on either side of the holdouts. Pomar said some of the remaining residents now had unsafe roofs and walls. The sidewalks also have been ripped up.

Some of the other remaining homeowners are represented by the AARP Litigation Foundation, or are unrepresented landlords who rent out their rowhouses.

Last month Hoffman told Maley that she would not authorize any more litigation. Maley had appealed last year's federal court ruling to a panel of the U.S. Court of Appeals for the Third Circuit in Philadelphia. When he lost again, he appealed for a rehearing before the full court, which upheld the ruling.

Maley then considered appealing to the U.S. Supreme Court, insisting that the other courts had made a mistake because there was no discrimination.

"They're wrong sometimes," he said in a 2011 interview. "If you are working in an area that's 100 percent minorities, how do you do any redevelopment there?"

Pomar had argued that displacing the neighborhood of Latinos and African Americans would lead to racial imbalance in the township.

Last month, Hoffman hired Joseph Maraziti, a North Jersey lawyer, to handle the negotiations with the remaining residents.

"My feeling is the relationship has become so strained between Maley and South Jersey Legal Services that there's no way to cut through that," Hoffman said. She said she has "lost faith" in Maley and does not want him to pursue the ruling to the Supreme Court.

Councilman Richard Dow said residents in the Gardens dislike Maley because "he is arrogant" to them when they ask questions at meetings.

Dow proposes offering the residents replacement homes in any newly built affordable-housing section of the neighborhood.

at 856-779-3224, or jhefler@phillynews.com or follow on Twitter @JanHefler. Read her blog at philly.com/BurlcoBuzz.