Brick City Report

BRICK CITY DEVELOPMENT CORP
Report
FORENSIC ADVISORY CONSULTING INVESTIGATION
SEPTEMBER 6, 2014
Submitted By:
Keith S. Balla, CPA,PSA,CFF,CGMA,Partner
OConnor Davies, LLP
20 Commerce Dr., Suite 301
Cranford, New Jersey 07016
(201) 341-0678
September 6, 2014
Otis Rolley, Interim CEO
Brick City Development Corp.

744 Broad St, Suite 1110
Newark, NJ 07102
Re: Forensic Advisory and Consulting Investigation
Dear Mr. Rolley:

In accordance with your request, we have performed specialized forensic consulting
services to evaluate the operations of Brick City Development Corporation (BCDC) for
the years 2007 through 2014. Our forensic consulting services included a review of the
BCDCs projects, financing, revenues, and analysis of the overall financial operations,
related party transactions and reporting.
On August 11, 2014 we interviewed Victor Emenuga, Chief Executive Officer (CEO) of
BCDC. Victor began his employment with BCDC in 2008 and was very familiar with its
operations and activities since he served in the capacity of Chief Financial Officer
(CFO) prior to 2014. Based on the responses obtained during our interview with CEO,
our forensic review of the annual audited financial statements and forms 990 (not for
profit tax returns) for the years 2010 to 2012 we selected and reviewed various source
documents and agreements that support the activities and operations of BCDC during
the period of 2007 through 2014. We analyzed available documents, records, and other
pertinent information related to the above referenced period and performed a forensic
operational review of activities, operations, selected policies and procedures, reports
and files to determine compliance with the overall objective of BCDC as stated in their
mission and corporate charter to retain, attract, and grow businesses; enhance small
and minority business activity; and be a catalyst for real estate development within the
City of Newark. BCDC was also planning to be a resource to streamline and expedite
the economic development process to create economic growth by assisting new
business, generate jobs for Newark residents and create opportunities for Newark
residents to develop skills to be employed and move upward in economic prosperity.
OCONNOR DAVIES, LLP

20 Commerce Drive, Suite 301, Cranford, NJ 07016 I Tel: 201.341.0678 I Fax: 908.272.2416 I www.odpkf.com
OConnor Davies, LLP is a member firm of the PKF International Limited network of legally independent firms and does not accept any responsibility or liability for the actions or
inactions on the part of any other individual member firm or firms.
Our forensic consulting services and evaluation of operations focused on the following
areas:
Review and analysis of operations, management, policies, and the overall
functions and activities of the BCDC.
Outlined findings and areas of question and concern in the operations and
effectiveness of BCDC.
Based on the findings and evaluation of the operations provided
recommendations for future activities of BCDC.
Specific areas that we reviewed are as follows:
One Time First Movers Loan Program
Grow Newark Loan Program
Urban Enterprise Zone (UEZ) Loan Program
Development Project Assistance Program
Small Business Assistance Program
Convention & Visitor Bureau
Newark Office of Film and Television
Bonding Assistance Program
Based on information obtained through the interviews of personnel and our analysis, our
findings are set forth in the following detailed report.
The accompanying report and supporting schedules present our findings. This report is
designed solely to assist you and Brick City Development Corp. in understanding the
findings, which were based on the interviews of personnel and review of various
documents and supporting reports analyzed, and as such, is not intended to be used for
any other purpose. Our analysis is limited by the documents and information provided to
the date of this report. We reserve the right to amend these findings and
recommendations should additional information and documents be obtained to change
our findings. If you have any questions, or should you need any additional information,
please do not hesitate to contact us.
Very truly yours,
Keith S. Balla, CPA, CFF, PSA, FCPA
OCONNOR DAVIES, LLP

20 Commerce Drive, Suite 301, Cranford, NJ 07016 I Tel: 201.341.0678 I Fax: 908.272.2416 I www.odpkf.com
OConnor Davies, LLP is a member firm of the PKF International Limited network of legally independent firms and does not accept any responsibility or liability for the actions or
inactions on the part of any other individual member firm or firms.
TABLE OF CONTENTS
1)
INTRODUCTION ................................................................................................................ 1
2)
SCOPE OF SERVICES ...................................................................................................... 1
4)
ANALYSIS OF OPERATIONS ........................................................................................... 3
5)
ANALYSIS OF ONE TIME FIRST MOVERS LOAN PROGRAM ........................................ 6
6)
ANALYSIS OF GROW NEWARK LOAN PROGRAM ....................................................... 13
7)
ANALYSIS OF URBAN ENTERPRISE ZONE (UEZ) LOAN PROGRAM ....................... 14
8)
ANALYSIS OF DEVELOPMENT PROJECT ASSISTANCE PROGRAM ......................... 16
9)
ANALYSIS OF SMALL BUSINESS ASSISTANCE PROGRAM ....................................... 18
10)
ANALYSIS OF CONVENTION AND VISITOR BUREAU ACTIVITIES .............................. 20
11)
ANALYSIS OF NEWARK OFFICE OF FILM AND TELEVISION ACTIVITIES .................. 23
12)
ANALYSIS OF BONDING ASSISTANCE PROGRAM ACTIVITIES ................................. 26
13)
ANALYSIS OF VENDOR INVOICES, AGREEMENTS AND PAYMENTS ACTIVITIES. ... 28
14)
RECOMMENDATIONS .................................................................................................... 32
EXHIBITS AND APPENDICES

EXHIBITS
Exhibit 1 Financial Statements Summary for the period of 2008 to 2012
Exhibit 2 Financial Statements Detail for the period of 2008 to 2012
Exhibit 3 Loan Funds Summary as of 8/15/14
Exhibit 4 Payments to vendors for the years 2010 through 2014.
APPENDICES (D-L ELECTRONIC VERSION ONLY)

Appendix A Documents Provided
Appendix B Assumptions and Limiting Conditions
Appendix C Curriculum Vitae, Keith S. Balla, CPA/CFF/ PSA/FCPA
Appendix D Policy Manual (Provided on request)
Appendix E-Financial Statements 2010-2012
Appendix F- 990 tax returns 2010-2012
Appendix G- Selected Vendor Invoices
Appendix H-Newark Downtown Core Redevelopment Corp tax returns
Appendix I-Selected -Board Meeting Minutes
Appendix J- Selected Vendor Contracts
Appendix K-NJ ELC report Empower Newark Political campaign
Appendix L- NJ ELC reports Booker Team Campaigns
1)
INTRODUCTION
Brick City Development Corporation (BCDC) was organized in 2007. Its office is
located at 744 Broad St, Suite 1110, Newark, NJ 07102. BCDC states that its mission is
to retain, attract, and grow businesses; enhance small and minority business activity;
and be a catalyst for real estate development within the City of Newark, New Jersey.
BCDC was also planning to be a resource to streamline and expedite the economic
development process to create economic growth by assisting new business, generate
jobs for Newark residents and create opportunities for Newark residents to develop skills
to be employed and move upward in economic prosperity.
2)
SCOPE OF SERVICES
We have been retained by you and Brick City Development Corp. s to perform
specialized forensic consulting services to evaluate the operations of BCDC for the years
2007 through 2014. Our forensic consulting services included a review of the Brick City
Development Corp operations, administration of loan programs, including a review of the
projects, financing, revenues, and analysis of the overall financial operations, related
party transactions and reporting.
3)
PROCEDURES PERFORMED
Our analysis was limited to the information made available by staff of BCDC and Victor
Emenuga, CEO including financial reports, payroll records, personnel records, vendor
files, vendor agreements, Board Meeting Minutes, loan files and agreements, reports
submitted by vendors and consultants, vendor invoices. Any misstatements or omissions
in the documents provided or in interviews could change the conclusions reached.
We relied upon the following information, reports and documents:
a) Annual Audited financial statements for years ending December 31,
2010 -2012
b) Interview responses and comments provided by:
1) Victor Emenuga
c) Form 990 tax exempt tax returns downloaded from GuideStar for years
2010-2012
d) Agreement between BCDC and the City of Newark for annual funding
e) Contract Agreement and invoices for activities of the Newark Office of
Film and Television
f) Payroll and compensation reports provided by the payroll department
for years 2007 to 2013
g) Contract Agreement and invoices for activities of the National
Development Council, outsourcing of loan administration
Page 1
h) Loan schedules, agreements and loan files in support of loans made

for all loans provided by BCDC
i) Bond assistance program agreements, reports and invoices
j) Detailed general ledger activity for limited accounts and supporting
invoices form vendors
k) Limited Board meeting minutes 2008-2012
l) Legal invoices in support of payments to law firm for various legal
services provided
m) News articles
n) Internet research
o) NJ Election Law Enforcement website
p) Schedule of funds held in Trust by BCDC
From the aforementioned reports and schedules, and responses provided in the
interviews, we selected various transactions and traced to the documents supporting the
compliance with policies and procedures and the value or benefit actually provided to the
City of Newark, its businesses and residents.
Attached as Appendix D is a copy of the Code of Business Conduct Policy provided
which was used as a basis for review and documentation of compliance by BCDC.
Page 2
4)
ANALYSIS OF OPERATIONS
Our analysis of BCDCs operations was based on the interview responses, review of
Board meeting minutes, review of annual audit reports and annual tax returns coupled
with our analysis of the records and documents.
Observations and Findings:
a) BCDC functions were organized into seven basic units reported in the audited
financial statements as follows:
Small Minority Business Development
Commercial Revitalization
Business Attraction
Convention and Visitors Bureau
Sustainability Initiatives
Management and General
b) The annual audited financial statements allocate annual expenditures among the
above units based on employee titles and assignments as a percentage of the
total expenditures paid for the year. Though the financial statements separate the
various units through the allocation of expenditures, it was apparent that the
amounts for each program are not tracked and recorded for the exact purpose of
each program. We observed that approximately 50% of the annual budget
spending was for internal employee salaries and benefits. Interestingly, our review
of the many vendor files and agreements indicated that most of the actual
services for the above program units were outsourced to consultants and the
internal employees activities provided little to no value to the City of Newark. The
organization was staffed rapidly and as a consequence it appears that there was
little accountability and result based evaluations performed. In addition, it was
apparent from our review of the vendor files, invoices and agreements that
contracts were given out to consultants with little support for the overall value to
be obtained by the City of Newark.
c) Based on the agreements and documents reviewed the organization continued to
increase its annual budget and personnel for alleged new programs but each new
program was actually outsourced to consultants who were paid in addition to the
salaries and benefits of the employees. Therefore the total of salaries and benefits
for BCDC personnel of approximately $2,400,000 per year were for general and
administrative costs of the BCDC operations. The other annual expenses of
approximately $2,100,000 per year were paid to consultants to perform various
services and research. These two categories of expenditures of BCDC comprised
the annual budget expended each year of approximately $4.5 million.
Page 3
d) Based on our interviews and review of documents and agreements the actual
programs embarked on by BCDC which used the majority of the annual funding of
the operations are listed as follows:
One Time First Movers Loan Program
Grow Newark Loan Program
Urban Enterprise Zone (UEZ) Loan Program
Development Project Assistance Program
Small Business Assistance Program
Convention & Visitor Bureau
Newark Office of Film and Television
Bonding Assistance Program
e) The CEO and staff were unable to supply any evidence of significant actual
benefits derived by the City or its residents from the various programs that BCDC
embarked on. For each of the programs listed above we reviewed the
agreements, expenditures, and invoices and found virtually no documents which
supported any significant benefits being derived by the City of Newark for the
funds expended.
f) One such vendor file, Convergent Nonprofit Solutions (CNS), which we
reviewed, illustrates the lack of merit and prudence in the use of funds by BCDC.
CNS was paid $125,000 for fundraising campaign study and fundraising
campaign itself. Gleamed from our discussion with Victor Emenuga, CEO, CNS
was not successful in raising funds and contract was terminated before BCDC
paid them the entire $250,000 under the agreement. No funds were recovered
from CNS.
g) During our review of financial statements for the period from 2008 through 2012
we noted that approximately $1,524,000 was spent on due diligence. Yet 40% of
First Movers Loan Fund and 29% of UEZ loan fund were written off or are
delinquent as of the date of this report. BCDC staff were unable to provide support
for due diligence performed on all loans.
h) $1.0 million was set aside for Construction Bond Loan Funds to provide project
bond financing. $512,000 (more than 50%) of these funds were spent on general
consultants expenses by December 31, 2012 and not used to provide loans.
i) Information in various loan schedules provided by BCDC staff did not agree to
supporting documentation in the loan files. The loan schedules themselves did not
agree to each other and listed various loan terms for the same loans.
Page 4
j)
South Ward Industrial Park - We made inquiry about the transaction and sale of
the South Ward Industrial Park (SWIP). We are aware that Newark recovered
several properties and cash in its settlement with Newark Economic Development
Corporation. The City obtained title to the SWIP and BCDC was charged with
finding a buyer to maximize the benefits to Newark. The Board minutes reported
that the property sales price had a minimum floor of $6.2 million and that BCDC
had appraisals of the property for $7.4 million. BCDC reported that the property
was ultimately sold for $4.5 million. BCDC was unable to supply any information
about this transaction and claimed the City employees handled the entire matter
which was inconsistent with the minutes of BCDC. We question if the property
was sold below market value and what benefit at the time and into the future the
City received if any at all.
k) Travel to Portugal - The Board minutes of October 27, 2008 indicate that Mr.
Pryor, Mr. Belo and Mr. Gomez participated in a trade mission to Lisbon on
October 16. The minutes also indicate that the trip required no public funds and
that the mission was being funded by the Portuguese American Chamber of
Commerce.
We question the appropriateness and transparency between
government employees traveling to a foreign country paid for by an organization
within the City and whose members do business with the City.
l) Noble Strategies - The Board minutes of February 25, 2008 indicate that the
Board had reservations about the capability and qualifications of Noble Strategies
yet they were hired and paid $236,000
m) We requested a copy of the severance policy approved by the Board on January
28 2014 and a detailed listing of all employees and the amount of severance
compensation paid each. We specifically questioned whether the former CEO
was paid severance after he submitted his resignation immediately after the Board
approved the severance policy. Severance should only be considered for
payment on termination and not when employees voluntarily resign to leave for
another job. BCDC did not supply us with the severance policy nor did they
provide the amounts paid to employees that we requested. Since we were not
provided the information requested we have not determined who was paid
appropriately or inappropriately at this time.
Page 5
5)
ANALYSIS OF ONE TIME FIRST MOVERS LOAN PROGRAM
Our analysis of the One Time First Movers Loan Program was based on our interview of
the CEO and review of the loan files, agreements, documents and reports. The program
was funded with $3.0 million to provide loan incentives for first time moving of
businesses to Newark.
a) General Notes on First Movers Loan Findings
o Out of $3,276,453 in loans (20 loans) given out only $669,666 was
collected to date (20.44%).
o Of the amount above $1,014,000 in loans (4 loans in total) were written off
due to the borrower filing for bankruptcy. Nothing appears to be recovered
for these loans since BCDC did not obtain any collateral or liens.
o $512,453 in loans given out is 400+ days delinquent.
o Repayment terms for many loans include number of months (6-12) of
interest payments only.
o Few loans had court settlements and demand letters, however borrowers
failed to act on these. No support for additional collection efforts was
provided.
o Loans were given out to applicants in distressed financial situation as
bridge loans in anticipation of additional funding from government contracts
or sales. BCDC accepted second/third lien on personal properties of
owners as collateral. These liens were later discharged when borrowers
filed for bankruptcy.
o Personal tax return of borrowers and guarantors was not included/analyzed
in all cases. Often borrowers did not posses any significant assets (other
than mortgaged houses) during loan application.
o Loan for Indigo Hotel of $500,000 was missing Application, due diligence
support, modified loan documents after additional $2 million. loan was
provided from UEZ fund. This loan appears to be structured as a grant,
unless the Hotel receives another grant from City. We could not verify what
the status of this loan is.
o BCDC agreed to provide $500,000 as collateral for Devils Broad LLC. No
financial sustainability of Devils analysis was provided. Supporting
documentation mentions that the reason for collateral was the fact that
Devils were in default on $10 million loan with Citi National Bank, but
Page 6
wanted to get Citi to remove liens and assessments from properties. Not
clear why BCDC agreed to provide collateral.
o One loan guarantee of $100,000 was provided on a loan which purpose
was to refinance business debt on personal credit cards totaling $67,000
and balances of business credit cards. The borrowers defaulted on the
loan and bank collected guarantee. Borrowers subsequently filed for
bankruptcy.
o The loan files for some loans were not complete and were missing
essential documents needed for due diligence, such as borrowers
personal tax returns and/or business financial statements.
Below are key points on delinquent or written off loans over $100,000.
b) Brick City Bar & Grill
Owner Izzy Sema
Address 35 Edison Place, Newark, NJ
Loan amount - $600,000
Date of loan May 1, 2009
Interest rate of loan 4.25%
Loan Status Approximately $150,000 was received in principal payments.
Currently in bankruptcy and loan was written off.
Loan purpose: funds were received for leasehold improvements of property
(restaurant)
Contractor hired was DiScola Contracting Corp.- 25 Madison Ave. Wyckoff,
NJIndividual Guaranty by Ismet I. Sema and Brian Karwoski
Guarantor TLC Investments, LLC signed by members Kruno and
Marina Kunkera.
Third Lien positions were placed on the properties of the individuals listed
above. First Lien priority was placed on the furniture and equipment.
c) Environmental & Occupancy Safety Services
Owner Sharon & Daryck Brown
Address 982 Broad St., Newark, NJ
Date of loan August 18th, 2009
Interest rate of loan 5.25%Loan Status Approximately $5,000 was
received in principal payments.
Page 7
Currently delinquent for 400+ days and final judgment to be filed with
the Supreme Court.
Loan purpose: funds were used for working capital as business was
opening a second location.
Loan collateralized by personal home of approx $600K value, with first
mortgage outstanding on this house of approx $511K. Other than that,
there was about $20,000 in checking and savings accounts of borrowers.
Interim income statement as of 6/30/09 had net loss of approximately
$114K.
The borrowers were anticipating large government contract by the end of
09, however these contracts were not received.New Jersey Community
Capital is acting as a Serving agent for the billing and collection of
payments due to the lender.Individual Guaranty by Sharon and Daryck
Brown
Demand letters were sent multiple times and were ignored.
The loan was restructured in January 2013 pursuant to a court settlement.
However, payments according to the settlement were not received.
Sharon Brown in 2008 received an award from Make Mine a Million where
Mayor Booker was a keynote speaker.
d) Indigo Hotel (810 Broad Street, LLC)
Owner - 810 Broad Street, LLC is owned in equal parts by Brick Equity,
LLC and 196 Market Street, LLC.
Members of Brick Equity, LLC are Samer Hanini and Thafer Hanini.
Member of 196 Market Street, LLC is Islam Zughayer
Address - 810 Broad Street, Block 165, Lot 11, Newark NJ 07102.
Date of loan June 29, 2009
Interest rate of loan 2.5%
Loan Status No principal payments were received on this loan as of the
date of this report. The loan appears in default.
Loan purpose: construction of new boutique hotel.
The loan was contingent on receipt of HUD Faade Investment Grant. It is
unclear from the supporting documents whether the grant was received. If
the grant is not received this loan turns into grant, provided that
construction begins within 18 months from the funding of the loan. If the
construction does not begin in 18 months then loan remains in full force. If
Page 8
the project is not completed in 36 months then it is considered to be in

default. If the property is sold within 5 years of funding of this loan, all
principle and interest becomes due together with $100K penalty. The
status of this loan was not documented in the loan documents provided by
BCDC staff.
The loan is personally guaranteed by Samer Hanini, Thafer Hanini, Islam
Zughayer; however no support for attempted collections of this loan was
provided.
e) Port City Brew Pub, LLC
Owner Greg Gilhooly & John Feeley
Address 44 Commerce Street, Newark NJ
Date of loan July 14, 2009
Interest rate of loan 6%
Loan Status no principal payments were received on this loan.
Currently in bankruptcy and loan was written off.
Loan purpose: leasehold improvements/construction of start-up
brewery/pub.
Borrowers and personal guarantors: Greg Gilhooly & John Feeley.
The property and all assets were already used as collateral with TD bank
for the purchase of the property. Other than personal guarantee, BCDC did
not obtain any security.
As of January 2011, the debt with TD bank was in defaulted. The debt was
subsequently restructured.
BCDC employed Faithful Gould to monitor the construction project
and was paying them consulting fee.
In addition, BCDC was working on a marketing plan for Port City as the
business has not properly marketed itself.
No tax returns of owners were evaluated during application process.
Mayor Booker attended business opening in 2010.
f) Newark Art Supply
Owner - Chris & Ade Sedita
Address - 61 Halsey Street, Newark, NJ 07102
Date of loan October 16, 2009
Page 9
Interest rate of loan 5%

Loan Status - Loan defaulted and written off due to the bankruptcy of
the borrowers.
Loan guaranty on $100K loan from Citibank.
Purpose of the loan is to refinance business debt on personal credit
cards totaling $67,000 and balances of business credit cards.
2008 financial statements presented $23,140 of current assets, of which
$22,149 were in inventory.
Ade Sedita was working in 2006 for two months with Udai Tambar in
Newark in Transition, Newark, NJ, who in turn also served as the Policy
Director for Newark Mayor-Elect Cory Booker's transition team and the
Manager of Policy and Operations at the 9/11 United Service Group.
Mayor Booker attended the art supply store opening back in 2002.
2008 Personal Financial Statements from US Small Business
Administration show negative net worth.
In 2008 Chris worked for Hanini Construction who is building Indigo Hotel
and also built Rockplaza lofts.
g) Lincoln Park
Owner - Lincoln Park Coast Cultural District
Address - 1033 Broad Street, Block 118, Lot 20, Newark, NJ
Date of loan - June, 2011
Interest rate of loan - 2.5%
Loan status Approximately $207,000 of principal was repaid on this loan.
The balance is over 700 days delinquent.
This loan was provided in addition to the first priority mortgage of $1.4
million with interest rate of $7.75% held by Community Loan Fund of NJ.
BCDC provided an additional $100K repayment guaranty on the $1.4
million loan.
Purpose of the loan bridge financing to help repay prior outstanding debt
with Wachovia and LISC of approx. $3.329 million. The borrower defaulted
on these loans and lending institutions agreed to settle for the total of
$1.725 million.
Borrower has an unfavorable history with NJCC in past where loans were
not repaid timely and carried outstanding balance.
Page 10
Quote from CAM_LPCCD 1.25.11 document (Credit Approval

Memorandum) The City of Newark has asked New Jersey Community
Capital to assist in this transaction by providing financing.
The executive director of LPCCD was listed as Baye Adofo-Wilson.
Financial analysis performed by NJCC indicates that repayment of both
loans is contingent on the sales of the units in the property.
On December 29, 2011 an initial revolving loan of $100,000 was awarded
to the borrower. The loan was designated to pay various expenses that are
reimbursable under grant from City of Newark. The loan was repaid in full.
On July 9, 2012 a second draw on $100K revolving loan was approved for
$87,452.69 to LPCCD from BCDC with interest rate of $8%. At the date of
the report this loan is over 800 days delinquent with no principal
repayments received by BCDC.
In February of 2014 a new loan from NJCC was approved for $1.004
million for the purposes of refinancing existing debt of LPCCD with NJCC.
h) Devils Broad LLC
Owner - Devils Broad LLC
Address 165 Mulberry Street, Newark, NJ 07102
Date of loan March 18, 2011
This was collateral posted by BCDC on behalf of Devils with Citi National
Bank. The Bank issued a mortgage note in 2008 to Devils for $10 million.
In 2009 a second mortgage was issued to them and rents and leases were
assigned to City National Bancshares. The Devils wanted to have Citi
bank release the property from liens of mortgages and assignments. Devils
agree to pay $1mln towards outstanding principle balance and provide
another $500K to be held as collateral at Citi. BCDC provided the
collateral.
On 2/11/13 a letter was sent to Gluck Walrath notifying them that Devils
have 7 days to repay collateral to BCDC. The collateral was not repaid as
of the date of this report.
Page 11
Recommendation on The One Time First Movers Loan Program:

BCDC must cease being in the loan business under its current administrative practice,
policies and improper extension of credit. BCDCs past practices include their poor
evaluation of creditors business plans; and the poor history of collections and
recoveries. BCDC needs to completely revamp its operations, policies and approach to
lending. BCDC has failed to date in their administration and lending functions and
depleted valuable City resources that are desperately needed by the City. BCDC has
tremendous opportunity to be a catalyst for success and business enhancement if
properly managed.
In addition, migrating to a paperless digital environment could save dramatically on file
storage space and improve efficiency.
Page 12
6)
ANALYSIS OF GROW NEWARK LOAN PROGRAM
Our analysis of the Grow Newark Loan Program was based on interview of the CEO and
review of the loan files, agreements, documents and reports. There were 4 loans given
our by this fund for the total of $3,617,500. 3 loans appear current, while the status of the
loan to The 6th Boro (summary below), which is the second largest loan provided by this
program, is unknown.
KDS 6th Boro $1,102,500.
Owner The Sixth Boro, LLC
Address 344-346 Martin Luther Blvd, Jersey City, NJ 07305.
Loan amount - $1,102,500
Date of loan Unknown, approximately summer 2009 based on Board
Report.
Interest rate of loan 2.5% on $632,500 of the loan and 4.25% on
470,000.
Loan status - Unknown. Loan documents provided by staff did not include
loan agreement or supporting documents for due diligence. Only the report
to Board of BCDC was provided to us. The loan schedule lists this loan as
completed and given out, however we could not obtain any essential
information about this loan.
Personal guarantee by Nicholas Scerbo and Patrick Russo.
The collateral coverage on this loan is only .66%, which includes a second
mortgage on a residential property of one of the owners.
City supported renovation of the building.
Page 13
7)
ANALYSIS OF URBAN ENTERPRISE ZONE (UEZ) LOAN PROGRAM
The analysis of the Urban Enterprise Zone Loan Program was based on interview of the
CEO and review of the loan files, agreements, documents and reports. In 2009 the City
entered into a pass through agreement with BCDC for a revolving loan program in the
amount of $9.0 million to finance projects in the urban enterprise zone in Newark. We
were informed that currently $7.3 million was provided in loans to various businesses
across Newark.
a) Food Depot -aka 75 First St Associates LLC
Owner - 75 First St Associates LLC
Address - 75 1st Street, Newark, NJ 07102
Loan amount - $2,000,000
Date of loan - May 1, 2011
Interest of loan - 2.0%
Loan status - the loan is in default and there is no documentation in
files evidencing any collection efforts nor any efforts to recover the
loan under the personal guarantees against the owners.
Personal guarantees from Orfilio Chaviano and Nectalier Gonzales III.
Borrowers legal representation by Trenk DiPasquale Webster.
Loan files include income and expense projections of new business.
Original owner of the real estate was Linda Cohen who sold the property
for $2,500,000 on 11/24/2010.
Food Depot accumulated debt on the property within six months with
Crown Bank totaling $6,800,000 and Food depot used the $2,000,000 to
make a partial pay down for Crown Bank debt.
No appraisals of the property were provided to us.
The tax returns submitted by Chaviano are inconsistent with the financial
statements submitted by him and no evaluation for discrepancies in the
files. The tax return reports a substantial loss from business and yet the
financial statements report a significant value of the business with no other
supporting documents.
The loan files have no support for the closely held businesses owned by
Chaviano which represent over 50% of his net worth in the amount of
$5,000,000.
Page 14
b) Inferno Limits
Owner Inferno Limits Paintball and Laser tag, LLC
Address 400 Ferry St. Newark NJ
Date of loan - December 1, 2012
Interest rate of loan - 3.5%
Loan status No payments were received on the loan. The entire balance
is outstanding for over 500 days.
Personal guarantees from Heriberto Soto, Jr., Raymond Ocasio III and
Kayne Kornecny. No support for collection efforts from these people was
provided.
BCDC has a first lien on all business assets and second lien on the
property leased for the business (29 Highland Avenue, Newark, NJ 07104)
We examined a draft of complaint with the court on behalf of BCDC;
however it is not clear if this complaint was actually filed.
Credit report for Soto has a fraud alert on it.
Recommendation on Urban Enterprise Zone Loan Program:
properly managed.
Page 15
8)
ANALYSIS OF DEVELOPMENT PROJECT ASSISTANCE PROGRAM
Our analysis of the Development Project Assistance program which used UEZ funding to
assist various development projects in Newark was based on our interview of the CEO
and review of the loan files, agreements, documents and reports.
Listed below are various real estate development assistance projects which BCDC has
provided as part of Development Project Assistance program (based on discussion with
CEO):
a) CityPlex 12 - $1,200,000 was provided in a form of a loan to finance

renovation of the only movie theatre in Newark. The assistance was
provided in 2011 and to date $115,500 was collected through regular
monthly payments. The loan is current.
b) Courtyard Marriott - $500,000 was provided for leasehold
improvements for space to be occupied by Loft 47. The loan is current
and through regular monthly payments the total collected through
August 1, 2014 was $27,092.
c) Food Depot - $2,000,000 was provided for bridge acquisition financing
for vacant flea market, which was planned to be redeveloped into a
supermarket. The loan originated in 2011 and through sporadic
payments the total collected through August 2014 was $212,478. The
loan is in default and borrower requested it to be modified. No
documentation of collection efforts present in loan files.
d) Hotel Indigo - $2,000,000 was provided for financing of construction of
the Hotel Indigo. The loan originated in 2009 and to date only
$125,000 was collected. The loan appears current, even though their
loan from First Movers Fund is past due.
e) Teachers Village - $1,000,000 was provided as gap financing for a
$120 million project which is supposed to create 200+ residential units,
3 charter schools and 30,000 sq. ft. of retail space. Loan originated in
2012 and to date $123,655 of principal was collected. Loan is current.
f) Harmony Square - $100,000 was provided as a grant from First
Movers Fund to facilitate the rehabilitation of Harmony Square, which
is to provide various contracting opportunities and apprenticeships for
minority based Newark Business.
Page 16
No evaluation of the results of these development projects was performed by

BCDC. No statistical data is maintained on the number of employment positions
occupied by Newark residents at these businesses or on property taxes paid to
the City of Newark.
Recommendation:
We recommend that BCDC vigorously pursue collection of these delinquent loans
against the personal guarantees to recovery the $2.0+ million in default. BCDC must be
reorganized to operate like a community Bank in the evaluation and administration of
loans and programs. Each program and the expected value and benefits need to be
clearly defined and articulated and communicated throughout the organization. In
addition individuals responsible for operations, activities and results need to be held
accountable.
Page 17
9)
ANALYSIS OF SMALL BUSINESS ASSISTANCE PROGRAM
Our analysis of the Small Business Assistance Program which used outside consultants
to conduct seminar training for potential business owners in Newark was based on our
interview of the CEO and review of the agreements, vendor invoices, documents and
reports.
The BCDC Technical Assistance Program is a free entrepreneurial and small
business training course designed specifically for Newark based businesses,
residents and local college students who are interested in the benefits of starting a
small business with the basic understanding of how to accomplish these goals.
The course content covers basic topics such as financing, credit, financial
reporting and budgeting, sales and marketing, and legal and regulatory issues.
The course was designed in a lecture format for each participant who may have
no prior business experience and those who may have some form of experience
looking to improve their existing business models. In addition, the course was to
provide the participants with the basics of a business plan, learning how to market
and brand their ideas, strategies to grow their businesses, labor and tax laws,
create a network of support, and business financing information for loans and
grants. Upon successful completion of the course participants were encouraged to
apply for grants toward their businesses.
Our analysis noted that after the former internal accountant for BCDC Floyd
Townsend & Associates was terminated, he was granted this special program to
administer for BCDC. Previously Floyd Townsend & Associates provided the
internal accounting for BCDC and was paid approximately $167,000 for those
services. Afterward the accounting was prepared by internal staff of BCDC under
the direction of the CFO, Victor Emenuga. BCDC entered into an agreement to
pay Floyd Townsend & Associates (Townsend) for classes to potential small
business owners in Newark. The actual seminars were outsourced by Townsend
to other people. Townsend was paid $49,462 for 2010; $49,462 for 2011:
$41,932 for 2012 and $38,237 for 2013 for the seminars under this program.
The participants for these seminars attended four sessions lasting two hours each
for a total of eight hours of seminar training. BCDC was unable to provide any
evidence of the success of these potential business persons nor could they
provide any evidence of any benefits to the City overall for the use of these funds.
BCDC provided a long list of over 100 eligible people however when we made a
more in depth inquiry and review of records we found that only few people had
actually taken the 8 hour course. In one instance the original amount listed
approx. 80 people and only 15 people actually attended the course. BCDC had
Page 18
no follow up documents to support if the program increased new business or

employment by city residents.
Recommendation:
We recommend that in the future BCDC either not enter into this type of unmonitored
activity or obtain grants from other established businesses and Banks to fund such
programs as these and monitor any success rather than use the limited resources of the
City with no accountability.
Page 19
10)
ANALYSIS OF CONVENTION AND VISITOR BUREAU ACTIVITIES
Our analysis of the Convention and Visitor Bureau Program disclosed that
Internal employees were ramped up and used at the same time it appears all of the
actual work was performed by outside consultants to develop the website, planning,
staffing and business outreach for potential business and visitors to Newark. Our
information was based on our interview of the CEO and review of the agreements,
vendor invoices, documents and reports
The Greater Newark Convention and Visitors Bureau (GNCVB) began as an
incubator program under the leadership of Brick City Development Corporation
(BCDC) in 2008. BCDC spent substantial funds to develop GNCVB.
Upon its establishment GNCVB used internal employees of BCDC, although upon
further examination of its expenses it appears that various consultants were
employed to develop the website, planning, staffing and business outreach for
potential business and visitors to Newark. However, the benefits of GNCVB were
not solely for Newark. Our review of the invoices indicated that funds were used
for advertising and billboards for Elizabeth and the Airport in addition to direct
Newark activity. Additional expenses for various marketing and legal support
services were expensed as part of general BCDCs expenses. For example,
BCDCs legal vendor Gluck Walrath LLP was directly involved in the promotion of
new legislation for Tourism Assessment Tax, designated to fund operations of
GNCVB. However all expenses related to legislation were paid by BCDC and no
evidence was presented to demonstrate that GNCVB will be held responsible to
repay these fees.
We have listed below from the financial statements the amounts classified for the
operations of the CVB.
2014
2013
2012
2011
2010
2009
2008
TOTAL
107,318
544,650
641,913
502,269
573,397
614,499
178,290
$ 3,162,336
We were also informed that BCDC has an agreement with the GNCVB to repay
BCDC for 2013 and 2014 expenses totaling $651,969.
Page 20
Listed below are several consultants who were paid and categorized under the
Convention and Visitor Bureau Program:
VENDOR
Career Sports & Entertainment, Inc.
Career Sports & Entertainment, Inc.
Clear Channel Outdoor
Devils Arena Entertainment, LLC
Eventage Event Production, Inc
Greater Elizabeth Chamber of Commerce
Group C Media, Inc
Group C Media, Inc
In Flight Media Associates, Inc
Media Two
Media Two
Michael T. Fiur Productions, Inc
Michael T. Fiur Productions, Inc
MILLENNIUM STRATEGIES
Newark Downtown District Management Corporation
Newark Downtown District Management Corporation
Newark Regional Business Partnership nrbp
Newark Regional Business Partnership nrbp
North Star Destination Strategies, Inc
Princeton Partners, Inc
The Star Ledger
The Star Ledger
The Star Ledger
The Star Ledger
The Star Ledger
Titan Outdoor, LLC
Titan Outdoor, LLC
Titan Worldwide
Xplore Communications, LLC
Xplore Communications, LLC
TOTAL
AMOUNT
54,000.00
30,404.52
2,700.00
16,880.00
73,624.55
44,086.49
30,740.00
30,980.00
25,500.00
17,500.00
40,450.00
10,000.00
16,000.00
32,000.00
15,000.00
105,161.45
22,500.00
30,000.00
10,000.00
10,000.00
56,768.61
26,750.00
32,610.00
63,955.41
66,745.00
83,750.00
126,267.20
32,720.00
87,972.61
23,038.64
8,100.00
111,790.98
17,498.96
7,260.00
42,711.10
4,000.00
1,409,465.52
YEAR
2010
2011
2010
2011
2011
2011
2010
2011
2012
2011
2012
2013
2011
2012
2010
2011
2010
2011
2012
2010
2011
2010
2011
2012
2011
2012
2010
2011
2011
2012
2012
2010
2011
2010
2010
2013
Page 21
During the review of the Board of Directors of GNCVB we noted that two people
who had outstanding loan balances with BCDC were part of the Board. Below is
the list of BOD of GNCVB:
Robert Provost (Chair)
Chip Hallock (Secretary)
John Maganifo
Blenda Riddick
Ron Beit
Eric Marks
Craig Kebbie
Crystal Stell
Kyle Pottinger
Cathy Coanda
Augusto Amador
Cathleen Lewis
Thafer Hanini (Vice Chair)
Gordon Haas
Miles Berger
Pat Strocchia (Vice Chair)
Gwen Moten
NPRB
Newark Airport Marroitt
United Airlines
Teachers Village
Courtyard Newark Airport
Courtyard Downtown Newark
Outlet Collection Jersey Gardens
Prudential Center
Crowne Plaza
Newark City Council
AAA New Jersey
Hotel Indigo
Elizabeth COC
BW Robert Treat
Marroitt Hotels
City of Newark
Recommendations:
We recommend that the newly established GNCVB fully reimburse BCDC for the entire
cost of $3,162,000 over the next six years to fully return to BCDC the City funds used for
the establishment of the GNCVB.
Page 22
11)
ANALYSIS OF NEWARK OFFICE OF FILM AND TELEVISION ACTIVITIES
Our analysis of the Newark Office of Film and Television (NOFT) was based on
reports.
We were informed that NOFT was created as a collaboration effort between the City of
Newark and the film and television community. BCDC paid for and provided all
employees, space for employees and funds for all website and marketing expenses. Our
review disclosed that BCDC used Internal employees at the same time it hired outside
consultants to perform all actual work to develop the website, planning, staffing and
business and community outreach to Newark and the world.
BCDC does not charge/allocate any expenses to NOFT for the use of the space.
BCDC agreed to provide $30,000 in 2014 as financial support to the NOFT. The
funds are earmarked for NOFTs office and program needs.
The website does not appear to be maintained, since it still makes references to
Ironbound Film and Television Studio .
Listed below are various vendors
activities related to NOFT:
who were paid for the establishment and
Vendors
Amount
Alvarez Photography
7,240.00
Alvarez Photography
22,636.90
Alvarez Photography
16,862.40
Brendan Hermes
2,500.00
DLA Piper LLP (US)
577.80
DreamPlay, LLC
18,275.00
DreamPlay, LLC
20,640.00
DreamPlay, LLC
3,375.02
FEMWORKS
22,047.03
FEMWORKS
61,206.51
FEMWORKS
23,325.00
FEMWORKS
18,800.00
Ironbound Film and Television Studios, LLC 9,500.00
Jessica L. Pitta
2,300.00
Kenneth B. Gifford
6,645.00
Lindsey Fischbach
2,550.00
New World Image Group, LLC
9,214.84
Year
2010
2011
2012
2012
2013
2012
2013
2014
2010
2011
2012
2013
2012
2012
2014
2012
2011
Page 23
O'Brien Kelley
O'Brien Kelley
O'Brien Kelley
RockAndRolledNerd Photography
Ryan J Weber
Soraida Peres
Tracey PITT
TRIBECA FILM INSTITUTE
Tritonic
Tritonic
Willaim Tunstead
Willaim Tunstead
Total
14,350.65
7,802.69
6,709.18
350.00
21,063.08
19,285.92
4,500.00
5,000.00
72,269.87
31,571.32
2,383.08
9,211.81
$442,193.10
2011
2012
2013
2012
2011
2010
2014
2013
2010
2011
2012
2013
TRITONIC
We reviewed the invoices of Tritonic and the invoices listed the address as 421 Halsey
St., Newark NJ which happens to be the address of New Jersey Community Capital.
Another invoice of Tritonic listed the address as 239 Washington St which is the same
address as numerous businesses like Newark Boys & Girls Club, Citizen Schools
Newark. We searched the website listed on the letterhead which is an organization that
has nothing to do with what the invoice was for. In addition the phone numbers have
been disconnected as well.
Based on the invoices and agreements for Tritonic it appears that this may be a bogus
fictitious organization that was paid by BCDC a total of $103,840. The files did not
contain information to support any value being provided to the City for the amounts paid.
We also have information that the Booker administration put forth the highest bid
contract from Tritonic to perform website services for the City of Newark for $490,000
but the Newark Municipal Council rejected the contract. The lowest bid for the same
work for the City was $118,700 from Gibson Technologies. The owners of Tritonic were
listed as Andres Jiminez, Nunizio Esposito and Luigi Tartara each of whom we
understand contributed to Booker TEAM for Newark political campaign.
Soraida Peres
We understand that Soraida Peres was employed by the City of Newark to run Channel
78. In addition Soraida ordered the television equipment for the City of Newark for the
studio. Those invoices for the studio equipment were processed and paid for by BCDC to
the outside vendor, Soraida Peres invoiced BCDC using a home address and personal
social security number under an agreement with BCDC for $85,000. We question if
Page 24
BCDC was paying for the same services that the City was paying for under the $160,000
City of Newark annual contract.
FEMWORKS
Kimberlee Williams of FEM WORKS was contracted to provide event planning etc. for
BCDC for $20,000. Another contract was for logistics for $12,000. The vendor files
contained no support that any work or value was provided to BCDC or the City for the
payments of the invoices which totaled $125,378.
Recommendation:
We recommend that no further funds be expended in this area by BCDC. In addition we
recommend that the City consider enlisting outside business persons to consider
creating a Newark Sports and Entertainment Commission (NSEC) which could work
collaboratively with NJPAC, the Prudential Arena, Newark Symphony Hall and Newark
Bears Stadium and the Red Bulls Stadium. Working with all venues together they can
obtain the most activity and revenue for the entire City. If the venues work together they
can obtain better and bigger and more sports and entertainment for Newark overall. The
expansion in this area could ultimately lead to possible convention activity in Newark as
well. The NSEC could also work collaboratively with the universities and arts community
to advance this activity in Newark. Also based on the history and contribution of artists
performing at Newark Symphony Hall there should be consideration for the birth of the
African American Music Hall of Fame housed out of Newark Symphony Hall.
Page 25
12)
ANALYSIS OF BONDING ASSISTANCE PROGRAM ACTIVITIES
It appears that all work for the Bonding Assistance Program was performed by outside
consultants to develop the contacts with subcontractors to assist in obtaining bonding,
planning, staffing and business to outreach in Newark. The same vendors also provided
monitoring for minority employment for various projects. Our information was based on
reports.
BCDC entered into several contracts with vendors for bonding assistance. BCDC
entered into contract with:
MZM Construction
ACB Consulting Services, LLC located at 292 Lafayette Ave., Newark, NJ
07105 under the direction of Alicia Biasotti Belotta;
Noble Strategy 158 Washington St, Newark, NJ 07102;
Surety Bond Associates (SBA) of Bala Cynwyd, PA by Ellen Neylan. The
proposal from SBA indicated that SBA would leverage the $1,000,000 of bond
assistance training funds with another $2,000,000 from a commercial bank as
a line of credit to guarantee each individual $100,000 bond guarantee for the
subcontractors. We were not supplied with any documents to see the value
come to fruition from this program. The Bond assistance contract awarded to
SBA was for $239,680.
We have listed below several of the payments for the bonding assistance
vendors:
VENDOR
AMOUNT
ACB Consulting Services, LLC
50,000.00
17,917.00
49,992.00
49,992.00
M & M LLC
100,000.00
MZM Construction & Management 52,607.87
MZM Construction & Management 11,137.50
NobleStrategy
111,257.10
NobleStrategy
71,331.56
NobleStrategy
53,502.00
Surety Bond Associates
18,403.87
Surety Bond Associates
53,502.71
TOTAL
639,643.61
YEAR
2010
2011
2012
2013
2012
2010
2009
2011
2012
2013
2010
2009
Page 26
Recommendation:
Since the files and invoices reviewed were unable to support any significant benefit of
this program and the City cant continue to waste funds on non accountable and
unquantifiable benefits we recommend that no further activity be conducted in this area.
Page 27
13)
ANALYSIS OF VENDOR INVOICES, AGREEMENTS AND PAYMENTS

ACTIVITIES.
Our analysis of Vendors focused on invoices, payments, agreements and activities as

they relate to any value or benefit to Newark and any benefit to the residents and
businesses of Newark. Based on the interviews and review of documents it is clear that
the entire payroll and benefits of BCDC were more administrative and general than for
any specific programs with any quantifiable results. Almost all work and services were
outsourced to outside vendors by management of BCDC. BCDC used internal
employees at the same time that all actual work was performed by outside consultants.
We noted the following general observations and deficiencies during our review of
vendor invoices:
Newark Riverfront Revival We note that payments for services were
made to Christopher Caceres, 250 Ballantine Parkway, Newark, NJ 07104
a personal address for a business activity. We also noted on the invoice
that Mr. Caceres email address is caceresc@ci.newark.nj.us which is a
City of Newark email address. We question whether Mr. Caceres is getting
paid both as a City of Newark employee at the same time as BCDC is
making payments directly to Mr. Caceres and what conflicts of interest or
potential unethical activity has occurred.
Franzini Consulting, LLC We note that BCDC retained Franzini
Consulting LLC in 2013 and 2014. The vendor files did not provide any
support for the services. We do however note that Caren Franzini was the
Chair of NJ Urban Enterprise Zone Authority and granted the $9.0 million
UEZ loan fund to the City of Newark and BCDC on December 12, 2008.
There is an appearance of a conflict that BCDC has retained Franzini for
undisclosed consulting services after Franzini as a State Director awarding
BCDC $ 9.0 million. Total amounts paid by BCDC to Franzini $24,293.
Florio Perrucci Steinhardt & Fader this company served as BCDCs
legal vendor. The initial retainer letter dated November 2007 states that
fees will be charged at a rate of $175.00 per hour for all attorneys. The only
invoices for which BCDC was charged $175.00 per hour rate were
November and December 2007. All subsequent invoices reported fees
charged at an hourly rate of $200.00 per hour. BCDC was unable to
supply a copy of the signed retainer letter agreeing to a change in the
hourly rates. During the period of 2010-2013 this vendor received
$787,233.89 in payments from BCDC; however only $388,042.84 of that
Page 28
amount was recorded as legal expense. BCDC staff did not provide details
as to which expense account the rest of the funds was recorded.
During the period of 2009-2014 BCDC expended $837,724.39 on various
legal fees. Largest expenses incurred from Florio Perrucci and Gluck
Walrath, LLP.
Seth Wainer We understand that Seth Wainer was employed by the City
of Newark as it s Senior Technology Policy Advisor. We do not have the
City of Newark payroll register and therefore question whether Mr. Wainer
was receiving compensation from the City of Newark at the same time he
was being paid by BCDC. Total amounts paid by BCDC to Wainer
$183,438.
Pereira & Azevedo, LLC, CPAS The same accounting firm that was
retained and paid by BCDC at its onset was also owed $15,000 by the
political campaign for Mayor Booker. The political campaign report listed on
the NJ Election Law Enforcement filings indicate that the accounting firm
was owed money by the campaign. We question whether the firm violated
the City of Newark pay to play ordinance instituted by Mayor Booker.
Interestingly the same accounting firm was also the accountant for the
Newark Downtown Core Redevelopment Corp. (NDCRC). In 2009
NDCRC paid the accounting firm $113,615. BCDC files had information
about the NDCRC and the review of the vendor files didnt have any
information to evaluate what purposes or relationship existed between
NDCRC and BCDC.
Newark Downtown Core Redevelopment Corp - We were informed of
other City activities connected with another City of Newark redevelopment
entity which wasnt clear so we obtained information about the entity. We
discovered that Mayor Bookers Chief of Staff, Pablo Fonseca became a
trustee of this entity along with Mayor Bookers Campaign Chairman and
his initial Business Administrator Bo Kemp in 2007. NDCRC obtained its
not for profit status in 2007.
The organization received $34 million in bond proceeds to acquire land for
a park and realign two roads surrounding the Prudential arena. Many of the
BCDC projects that obtained assistance are in this same area. By 2011 the
entity was dissolved after having expended all $34 million. No park was
built near the arena. The tax returns for NDCRC report expenses for the
purchases of land. Purchases of land are normally reported as capital
assets for an enterprise. However this entity reported the purchases of land
as expenses. We question who owns the land and buildings paid for with
Page 29
those funds as well. It is also interesting that NDCRC also retained the
same law firm as BCDC. NDCRC paid the Florio, Perrucci, Steinhardt law
firm approximately $2,582,000 between 2008 and 2010. The tax form 990
for NDCRC also reported that NDCRC paid another attorney, Francis
Giantomasi $275,000 for legal services in 2009. Mr. Giantomasis resume
on his website references that he has represented several of the
development entities which have received funding and loans from BCDC.
Giantomasi Oliveira, PC, the law firm that Mr.Giantomassi previously had
was located at 292 Lafayette St Newark, NJ which interestingly is the same
address of another vendor of BCDC, ACB Consulting Services LLC. ACB
Consulting Services, LLC under the direction of Alicia Biasotti Belotta were
paid $167,901 by BCDC for the period 2010 - 2014.
810 Broad Street LLC During 2010 and 2011 total of $1,648,876.90 was
recorded as expense under the vendor ID 810 Broad Street LLC. We
were unable to determine what kind of expense account these funds were
recorded in, since BCDCs staff did not provide us with detailed general
ledger or trial balance.
Emerita Urban Renewal LLC which we were informed is the parking lot
received $381,636.73 for the period from 2012-2014. Monthly parking fee
for the lot is approximately $150 per car ($1,800 per year). Based on the
payments BCDC paid for monthly fee for 212 cars over the period of 2.5
years.
Tritonic who according to invoices performed creative solutions for Go
Newark Restaurant Week and provided web hosting and maintenance and
received for their services $103,841.19 in 2010 and 2011 does not appear
to exist. The website provided on invoices belongs to an in-house health
care services company. Social media accounts for this company appear to
be abandoned.
Marketing Expense for the period 2008 through 2012 was $2,244,062 (per
audited financial statements).
.Listed below are additional payments to vendors in question:
VENDOR
Christopher Caceres
David Hanrahan
Franzini Consulting, LLC
Franzini Consulting, LLC
Megan Sweet
Seth Wainer
AMOUNT
22,239.98
13,538.47
5,843.75
18,449.75
11,731.20
97,497.00
YEAR
2013
2014
2014
2013
2013
2013
Page 30
Seth Wainer
Zachary Townsend
TOTAL
85,941.00
59,583.31
314,824.46
2014
2012
Exhibit 4 lists payments to vendors for the years 2010 through 2014.
Page 31
14)
RECOMMENDATIONS
Recommendation on The One Time First Movers Loan Program:

recoveries.
Out of $3,276,453 in loans (20 loans) given out only $669,666 was
collected to date (20.44%).
Of the amount above $1,014,000 in loans (4 loans in total) were written off
due to the borrower filing for bankruptcy. Nothing appears to be recovered for
these loans since BCDC did not obtain any collateral or liens.
$512,453 in loans given out is 400+ days delinquent
BCDC needs to completely revamp its operations, policies and approach to lending.
BCDC has failed to date in their administration and lending functions and depleted
valuable City resources that are desperately needed by the City. BCDC has tremendous
opportunity to be a catalyst for success and business enhancement if properly managed.
In addition, migrating to a paperless digital environment could save dramatically on file
storage space and improve efficiency.
Recommendation on Urban Enterprise Zone Loan Program:
properly managed.
Recommendation on Delinquent loans:
We recommend that BCDC vigorously pursue collection of these delinquent loans
against the personal guarantees to recovery the $2.0+ million in default. BCDC must be
reorganized to operate like a community Bank in the evaluation and administration of
Page 32
loans and programs. Each program and the expected value and benefits need to be
clearly defined and articulated and communicated throughout the organization. In
addition individuals responsible for operations, activities and results need to be held
accountable.
Page 33
Recommendation Small Business Assistance Program:

We recommend that in the future BCDC either not enter into this type of unmonitored
activity or obtain grants from other established businesses and Banks to fund such
programs as these and monitor any success rather than use the limited resources of the
City with no accountability.
Recommendations Convention and Visitor Bureau:
We recommend that the newly established GNCVB fully reimburse BCDC for the entire
cost of $3,162,000 over the next six years to fully return to BCDC the City funds used for
the establishment of the GNCVB.
Recommendation on Newark Office of Film & Television:
We recommend that no further funds be expended in this area by BCDC. In addition we
recommend that the City consider enlisting outside business persons to consider
creating a Newark Sports and Entertainment Commission (NSEC) which could work
collaboratively with NJPAC, the Prudential Arena, Newark Symphony Hall and Newark
Bears Stadium and the Red Bulls Stadium. Working with all venues together they can
obtain the most activity and revenue for the entire City. If the venues work together they
can obtain better and bigger and more sports and entertainment for Newark overall. The
expansion in this area could ultimately lead to possible convention activity in Newark as
well. The NSEC could also work collaboratively with the universities and arts community
to advance this activity in Newark. Also based on the history and contribution of artists
performing at Newark Symphony Hall there should be consideration for the birth of the
African American Music Hall of Fame housed out of Newark Symphony Hall.
Recommendation on Bond Assistance Program:
Since the files and invoices reviewed were unable to support any significant benefit of
this program and the City cant continue to waste funds on non accountable and
unquantifiable benefits we recommend that no further activity be conducted in this area.
Other Recommendations:
We recommend that follow up be done to determine if the sale of the South Ward
Industrial Park was for fair market value of the property.
We recommend that follow up be done to determine the nature of the activities, the
benefits to the City, compliance with use of Bond proceeds and disposition of the $34
Page 34
million expended by Newark Downtown Core Redevelopment Corp for the period 2007
to 2011 when it liquidated.
We recommend obtaining and reviewing the severance policy and all severance
payments to former employees to determine if they were properly paid in accordance
with the policy.
Page 35
EXHIBIT 1
Financial Statements Summary for the period of 2008 to 2012
865,763 , 4%
534,687 , 2%
385,388 , 2%
5 year expense total
958,605 , 5%
1,175,160
, 6%
Personnel Costs
Marketing
Other expenses
Due dilligence
1,222,023 , 6%
1,523,774 , 7%
10,088,046 , 49%
Consultants
Projects
Legal/audit/accounting fees
Rent and Utilities
Bonding assistance program
1,605,477
, 8%
2,244,062 ,
11%
Loan management fees
EXHIBIT 2
Financial Statements Detail for the period of 2008 to 2012
SUPPORT AND REVENUE

Fees, City of Newark
Fees, special programs
Project Fees
Grants
Contributions
Interest income
Other
Total support and revenue

EXPENSES
Salaries and wages
Payroll taxes
Fringe benefits
Due dilligence
Consultants
Cost estimators
Appraisals
Convention Visitors Bureau
Newark help line
Fresh foods program
Halsey street project
Newark TV production
Farmers Market
Marketing
Bonding assistance program
Loan management fees
Contract services
Human resources consulting
Depreciation and amortization
Rent and utilities
Training and conferences
Accounting fees
Telecommunications
Office expenses
Audit fees
Legal fees
Payroll servicing costs
Dues and subscriptions
Insurance
Teledata office equipment/consulting
Transportation
Bad debts
Miscellaneous
Bank service charges
Change in net assets
2008
2009
2010
2011
2012
3,560,490 $
3,490,752 $
255,763
3,211,668 $
305,725
3,419,313 $
84,740
424,600
405,840
84,636
80,929
8,003
4,000,648
5,820
487,736
83,943
63,857
65,165
$ 17,682,871
652,048
424,600
1,804,339
676,791
292,834
236,207
100,000
201,385
17,737
77,144
298,294
228,774
29,193
7,987
512,469
78,053
101,118
77,908
3,956,756
4,310,763
4,286,941
4,508,061
4,707,169
21,769,690
1,215,732
104,016
48,302
517,608
1,750,381
156,076
101,012
402,231
1,851,141
167,817
109,449
127,913
138,386
1,846,847
161,276
152,191
199,637
119,071
1,984,909
213,547
225,350
276,385
144,506
27,018
91,459
38,926
2,215
20,920
344,129
30,792
76,252
156,150
60,050
12,500
4,200
7,500
8,652
81,128
122,304
12,748
735,813
94,296
90,000
191,947
196,123
53,869
68,926
214,700
502,153
23,533
75,647
35,491
55,396
103,215
84,920
90,518
47,668
48,613
39,999
76,814
193,890
40,488
106,151
68,680
34,232
53,435
20,856
12,767
2,239
26,026
40,801
8,649,010
802,732
636,304
1,523,774
401,963
29,233
136,579
383,055
39,444
206,698
369,014
169,654
7,295
2,244,062
534,687
385,388
704,361
23,641
366,734
865,763
216,365
243,347
309,957
206,543
223,534
480,667
11,057
106,795
110,574
62,825
22,351
103,815
23,555
2,209
626
1,183
89,139
192,520
15,694
42,994
68,027
40,709
45,000
140,360
3,742
20,367
25,260
19,542
22,351
102,080
8,322
147
3,663,669
4,275,526
4,105,116
1,735
Total
293,087 $
35,237 $
181,825 $
49,318
84,740
50,243
7,295
484,151
85,814
68,552
35,500
10,261
79,724
185,851
34,206
3,684
61,342
38,119
40,000
115,419
3,552
17,642
18,563
19,709
5,820
46,613
325,822
277,175
82,263
226,723
13,380
65,661
190,287
41,057
64,240
44,870
45,100
224,888
3,763
21,904
13,183
21,335
3,474
148
11,759
105
3,980,529
4,578,145
20,602,985
129,024
$ 1,166,705
527,532 $
EXHIBIT 3
Loan Funds Summary as of 8/15/14
First Movers Loan Fund

600,000 , 18%
Principal repaid as of
8/15/14
669,666 , 21%
683,000 , 21%
Loans written off or

delinquent
Current loans
1,323,787 ,
40%
Loan guarantees
Fund total = $3,276,453
UEZ Loan Fund
710,080 , 10%
Principal repaid as of
8/15/14
4,477,398 ,
61%
2,112,522 ,
29%
Loans written off or

delinquent
Current loans
Fund Total = $7,300,000
EXHIBIT 4
Payments to vendors for the years 2010 through 2014.
Vendor ID
810BroadStreetLLC
FlorioPerrucci
WestonSolutionsInc.
CRGManagementLLC
HorizonBlueCross
45-57 EdisonPlaceLLC
EmeritaUrbanRenewalLLC
RealEstateSolutionsGroupLLC
Love&LongLLP
NationalDevelopmentCouncil
GreaterNewarkConservancy
Noblestrategy
PortCityBrewPubLLC
MitchellTitusLLP
FloydD.TownsendAssociates
SethWainer
Star-Ledger
PhilipsPreissGrygielLLC
ACBConsultingServicesLLC
LinkHigh
PrincstonPartners,Inc
convergentNonprofitsolutionsLLc
NewarkWarehouseInc
Aetna
Greenbaum,Rowe,Simth&Davis
Titan
FEMWORKS
MichaelTFiuProduction
VerizonWireless
RSBrownfieldRedevelopmentSolutions
THESWITZERGROUP
BirdsallServicesGroup
GluckWalrathLLP
Anton&Everett,LLC
Tritonic
M&MLLC
TheStar-Ledger
53HalseyStreet
RiddleCompany
GreaterElizabethChamberofCommerce
NorthStarDestinationStrategiesInc
Alvarez
CareerSportsEntertainmentInc.
WELLSFARGOINSURANCESER
CityofNewark(v)
GroupCMediaInc
DevilsArenaEntertainmentLLC
NewarkRegionalBusinessPartnership-n
NewarkDowntownDistrict
MediaTwo
Vendor Name
Florio Perrucci
Weston Solutions, Inc.
CRG Management LLC
HORIZON BLUE CROSS BLUE SHIELD OF NJ
Emerita Urban Renewal LLC
Real Estate Solutions Group, LLC
Love and Long, LLP
National Development Council
Greater Newark Conservancy
NobleStrategy
Mitchell & Titus, LLP
Floyd D. Townsend & Associates
The Star-Ledger
Phillips Preiss Grygiel LLC
LinkHigh
Convergent Nonprofit Solution, LLC
Greenbaum, Rowe, Smith & Davis LLP
FEMWORKS
Verizon Wireless
Brownfield Redevelopment Solutions, Inc
Gluck Walrath LLP
M & M LLC
The Star-Ledger
The Riddle Company
North Star Destination Strategies, Inc
Alvarez Photography
City of Newark
Group C Media, Inc
Newark Regional Business Partnership-nrbp
Newark Downtown District Management
Corporation
Media Two
Total Expenses
1,648,876.90
850,832.65
681,634.18
564,170.34
528,789.94
483,172.10
381,636.73
311,358.07
282,998.88
281,825.00
279,384.70
236,090.66
214,380.25
198,278.00
188,262.30
183,438.00
182,025.84
182,016.25
167,901.00
152,984.80
150,495.00
150,000.00
150,000.00
135,088.00
134,448.61
129,289.94
125,378.54
120,161.45
117,396.52
113,056.00
110,585.12
109,619.88
108,181.67
106,059.89
103,841.19
100,000.00
96,072.61
90,000.00
89,703.00
87,220.00
86,205.94
85,269.30
84,404.52
76,209.77
76,054.28
75,450.00
73,624.55
78,079.83
68,850.11
64,000.00
MillenniumStrategies
SIMPLEVIEW
Mongecapitalgroup
DCI
ZacharyTownsend
CoachUSA
Zakalak
ValueResearchGroup
ComcastSpotlight
IronboundCommunitycopr
MZMConstructionManagement
CoStarGroupInc.
StatefarmFCC
UrbanLeagueofEssexCo
XploreCommunicationsLLC
Horizon
MagaPathInc
JaffeCommunications
JonesLangLaSalle
EvenageEventProductionInc
MarketHalseyUrbanRenewalLLC
DreamPlay,LLC
Golub&Isabel
InkPublishing
NewJerseyHeadwearCorp
HRAAdvisorsInc.
MasseyAgency
KnoxRefrigerationInc.
BigCatconstructionLLC
TheNewarkClub
UnifiedVailsburgServiceOrg
GraryLovallo
URBANRENEWABLESOLUTIONS,LLC
COVAD
USMarketing
TheAmericaFlag
SUNWIZE
ElectricalDynamics, Inc
Lounge13LLC
TweetMyJOBS.com
ChristopherCaceres
GOTHICARCHGREENHOUSES
RogersCoTechnologyConsultantsLLC
Futurescape,Inc
ClearChannel
Vanassehangenbrustlininc
ObsidianDevelpmentLLC
FairmountVenturesInc
Janussolution
GMLVLLC
O'BrienKelley(E)
SearchWide
Faithful+GouldInc
DomingoGonzalez
TheFinancialClinic
ConwayData
FrungilloCaterers
Jeffery Monge
Zachary Townsend
Community Coach
Value Research Group
Ironbound Community Corporation
CoStar Realty Information, Inc
State Farm
MEGAPATH
Jaffe COMMUNICATIONS
Jones Lang LaSalle Americas, Inc
DreamPlay, LLC
Golub & Isabel
HR&A Advisors, Inc.
Massey Agency
The Newark Club
URBAN RENEWABLE SOLUTIONS, LLC
U. S Marketing Office Suply Co.
THE AMERICAN FLAG COMPANY, INC
TweetMyJOBS
Rogers & Co Technology Consultants LLC
Vanasse Hangen Brustlin, Inc
GMLV, LLC
O'Brien Kelley
SearchWide
Faithful+Gould, Inc
Conway Data
62,500.00
61,797.00
61,244.00
60,234.25
59,583.31
58,438.00
57,684.00
54,600.00
53,594.00
52,919.00
52,607.87
51,394.30
51,087.25
51,015.40
49,136.87
49,117.91
48,498.94
46,475.00
45,000.00
44,086.49
43,100.00
42,290.02
40,831.35
40,621.50
40,600.19
39,745.00
39,414.85
39,242.00
38,790.00
37,680.00
36,358.97
36,105.00
35,355.19
35,296.66
34,654.56
33,940.00
33,646.25
50,360.00
32,925.00
32,500.00
32,239.97
31,778.59
31,737.64
31,605.00
31,030.00
30,915.20
30,500.00
30,193.80
30,000.00
29,250.64
28,862.52
28,763.25
28,631.78
27,783.14
26,460.00
26,055.00
25,597.00
TheRealDealKorangyPublishing
AkermanSenterfittLLP
TDCARD
GROUNDSWELL
URBANACRES,INC
GeneEDePrez
DMCPubblishingLLC
OneSourceSolutions
JLWilsonAssociateInc
FranziniConsultingLLC
MJBConsulting
HartRestaurantGroupLLC
LasserSussmanAssoc(LSA)
NewJerseyTreeFoundation,inc
AlisonHolmesAccettola
ToniL.Griffin
Sun&MoonMarketingComm, Inc
ThePohlyCompany
UrbanfarmFresh
MikesellAssociates
RaynJWebber
PartiesToG
ThisisitStageWorksLLC
BrockFarmsInc
Rutgersthestateuniversity
LincolnPark
Na-VetPrintingCoLLC
intelligenttrafficsupplyProducts
TynishaColeman
EssexCountyLatino AmericanCham
SoraidaPeres
PentonMediaInc
CARRASCOMMUNITYINVEST
OmlandEngineeringAssociatesINC.
VerizonConferencing
360-394SpringfieldLLC
McMurry/TMG, LLC
SuretyBondAssociates
NewarkWorkforceInvestmentBoardinc
SocialSoltions
S9ArchitectureandEngineering,PC
Greenchipea
LyneirRichardson(E)
AirsealTechnology
NickTsapatsairs&Associates
NewWaveConstruction
THSMultimediaLLC
Option1Development Corporation
VideoTechnologiesGroupLLC
SANDLERSEARCHASSOCIATES
CROPKING
VISANOW.COMINC
DanielCordasco
GES
Aflac
Hudson
BombshellSalon
Akerman Senterfitt, LLP

Ground Swell Management, LLC
Gene E DePrez
One Source Solutions
J. L Wilson Associates, Inc
Sun and Moon Communication, Inc

URBAN Farm Fresh
Mikesell & Associates
PENTON MEDIA, INC

Verizon Conferencing
Newark Workforce Investment Board

S9 ARCHITECTURE AND ENGINEERING, PC
Lyneir Richardson (E)
Airseal Technology
Nick Tsapatsaris & Associates
Option 1 Development Corporation
VISANOW, INC
AFLAC
AMERICAN REPROGRAPHICS COMPANY, LLC
25,500.00
25,248.02
19,733.32
25,000.00
25,000.00
24,751.36
24,500.00
24,463.89
24,375.00
24,293.50
23,959.00
23,110.00
22,900.00
22,780.18
22,527.00
22,185.00
22,000.00
21,803.00
21,297.04
21,262.50
21,063.08
20,747.88
20,739.00
20,645.00
20,000.00
19,990.50
19,782.00
19,775.00
19,536.00
19,375.00
19,285.92
19,000.00
18,902.97
18,883.24
18,832.21
18,776.27
18,750.00
18,403.87
17,860.00
17,223.80
17,101.53
16,715.21
16,613.54
16,575.00
16,562.50
16,333.32
16,090.00
15,960.00
15,920.91
15,863.37
15,755.16
15,730.00
15,585.00
15,514.87
15,393.78
15,017.95
15,000.00
Eyeson Halsey
FundConsulting,LLC
LumiGrow
PookaInc
SUAD
VajaahEParker
INFERNOLIMITSPAINTBALL
RubenGomez(E)
Cablevision
WORKONMICSSTAFFINGRESOURCELLC
MAINSOURCEMETALFAB,LLC
DavidHanraHan
CarrinoGallagher
FundforthecityofNewYork
DanJennings (E)
ecologycenter
MinuteManPress
FrankCroke
TheaterSquareGrill
DianeLupke&Asso.
HalseyCleaner
GibsonMedia,Inc
MeganSweet
WilliamTunstead
MichaelDavidson(E)
NJBiz
RandomAccess
AspenLandscapingContractinginc
OAR
CreativeClassGroup,LLC
TRF
At-RiskInternational
T&TCateringLLC
DarrylGodfrey(E)
Idea-Evolver,LLC
LacasdeDonPedro,Inc
Verizon
InfiniteExito
AljiraInc
AniyaFoodLLC
BurgerWallaLimitedCorporation
CrownTwo,Inc
In-FlightAssociates,inc
M/RUIZDESIGN,LLC
SWHaferWebDesign
TempoNetworks,LLC
SharpenedImage
McCarter & EnglishLLP
coalitiontoEndChildhoodleadp
FirstInsurance
NewJerseyManufacturingEXtPro
Apptix
ClancyCallahan7Smith
ComitoAssociatesPCarchitecture
IronboundFilm&televisionStudious
NewworldImageGroupLLC
FUND Consulting, LLC
INFERNOLIMITS PAINTBALL & LASERTAG LLC

Ruben Gomez (E)
fbo WORKONOMICS STAFFING RESOURCES,
LLC
Dan Jennings (E)

MinuteMan Press of Newark
Frank Croke
Gibson Media, Inc

Willaim Tunstead
Michael Davidson (E)
Journal Publications, Inc
Random Access Entertainment
Offender Aid & Restoration
The Creative Class Group
T & T Catering, LLC
Darryl Godfrey (E)
Idea - Evolver, LLC
Verizon
M / RUIZ DESIGN, LLC

TEMPO Networks, LLC
Sharpened Image, Inc
McCarter & English, LLP
New Jersey Manufacturing Extension Program, Ir
Ironbound Film and Television Studios, LLC

New World Image Group, LLC
15,000.00
15,000.00
15,000.00
15,000.00
15,000.00
15,000.00
14,498.95
14,476.51
14,451.96
14,236.04
14,175.00
13,538.47
13,336.47
13,230.00
13,107.19
12,730.00
12,670.39
12,240.00
12,110.00
12,000.00
11,941.00
11,905.56
11,867.03
11,594.89
11,515.02
11,249.85
11,165.00
11,157.75
11,009.00
11,000.00
10,887.00
10,855.00
10,732.00
10,556.47
10,500.00
10,344.15
10,218.42
10,004.32
10,000.00
10,000.00
10,000.00
10,000.00
10,000.00
10,000.00
10,000.00
10,000.00
9,978.52
9,964.53
9,850.00
9,838.50
9,800.00
9,694.88
9,656.25
9,500.00
9,500.00
9,214.84
CornerstoneVillageLLC
NathanCooper
RoyalMarketing
InnovativeProgramsAssociateInc
aggregko
MarazitiFalcon&Healey
HudsonBlueprin
Cybul&CybulArchitects
BlueFocusMediaLLC
CommercialCashRegisterCorpInc.
AT&TMobility
Solutions4sure.com,Inc
BiedermanRedevelopmentVentures
AllenKantorowitz(E)
PrestigeTitleAgency
MarilynKShea
NorthAveDrivingSchoolInc
WILDFIREINTERACTIVE, Inc
Thecenterforcollablrativechange
Crimcheck.com
BryanCaveLLP
IEDC
Newwork
RidgeAbstract
InternationalYouthOrganization
WoodridgeChenArchitects
NJDepartmentofTreasury
HackensackRiverkeeper
GreenerbyDesign
TitanWorldwide
VictorC.Emenuga
FedEx
AmericanExpress
Journalcommunicationsinc
KennethBGifford
NWFinancialGroupLLC
SmithAppraisal
BrilliantLewisEnvironmentalServLLC
SoulsticeProductions
AdamsConstruction&Demolition
SeedGallery
ForwardEverSustainableBusAll
NJPac
RogersMarvelArchitectsPLLC
PolandSpring
NewJerseyInstitueofTechnology
MetLife
EnchancedVOIPCommINC
PreciousPetalsToo
HonorsProgram
USAARChitectsPlanners&InteriorD
DestinationMarketingAssc.Internatio
IncubatorInc
AdlerPrioly
CRAVINGS
InstituteforStudy&PracticeNonvio
LaurenHall(E)
Nathan Cooper (E)
MARAZITI FALCON & HEALEY, LLP

Hudson Blueprint CO, Inc
AT & T Mobility
DBA Tech Depot
PRESTIGE TITLE AGENCY, INC
Marilyn K. Shea
Wildfire Interactive, Inc
The Center for Collaborative Change
Crimcheck.com, Inc
IEDC
Greener by Design LLC

Victor C. Emenuga
FedEx
JOURNAL COMMUNICATIONS, INC
SMITH APPRAISAL
Rogers Marvel Architects, PLLC

Poland Spring
MetLife - Group Benefits
Precious Petals Too
USA Architects, Planners & Interior Designers, P. A.
Destination Marketing Assc. International
Adler Prioly(E)
Cravings
Lauren Hall (E)
9,208.83
9,175.86
9,044.50
8,925.00
8,800.00
8,757.55
8,807.50
8,500.00
8,491.00
8,487.00
8,477.65
8,451.22
8,294.00
8,193.64
8,091.00
8,000.00
8,000.00
8,000.00
7,998.00
7,976.88
7,900.00
7,812.00
7,680.00
7,639.00
7,600.00
7,500.00
7,334.80
7,334.00
7,300.00
7,260.00
7,154.40
6,945.28
6,877.78
6,705.00
6,645.00
6,500.00
6,500.00
6,448.72
6,356.88
6,350.00
6,271.42
6,000.00
5,966.47
5,774.04
5,758.42
5,700.00
5,585.35
5,576.31
5,560.00
5,500.00
5,500.00
5,385.00
5,300.00
5,155.18
5,110.22
5,100.00
5,056.90
B&HFOTO&ELECTRONIS
NewCityAmerica
CornettPublishingCo.Inc
BlackHackEnterprises
BongiornoProductionInc
DanMDENose
GalleryAferro
Idealcorporatiemarketing
MarkAlanHewitt Archects
NewarkPublicSchools
NewarkworksOneStopCareerCtr
NewJerseyRedevelopmentAuthority
NJTransit
ShearmanSterlingLLP
TRIBECAFILMINSTITUTE
KARMACONSIGNMENTBOUTIQUE
H2MAssociates,inc
PrecisionBiometricsInc
ICSC
ZeitgeistconsultingInc
InternationalCreativemanagement
TheCoffeeCave
TPConsulting
SmithTravelResearchInc
ALM
NewJerseyDeptof EnvironmentalProt
TRSLLC
State of IL
Just Delicious Ice Cream and Sand
PrincipalFinancialGroup
PitneyBowesPostageByPhone
EnterpriseDevelopmentCtrNJIT
ActionItem
ASPIRAIncof New Jersey
LeadershipNewark
PhyllisPeterson
PVPRADIUSLLC
UberBurger
pc/nametag, Inc
PitneyBowes
OHLVEY
UMG
AmandaNWhiteLaw
HectorOrtiz(E)
ARDAPPRAISALCOM
ElbertReid
MTWTF,INC
ScrippsnetworkLLc
MCIPropertymanagement
FirstPresbyterianChurchin Newark
MullerBohlinAssociates
SalvationArmy
Tri-CityPeople Corporation
KaiACampbell(E)
Landscapeforms
GlocallyNewark.com
NewJerseyCommunityCapital
New City America, Inc
Mark Alan Hewitt Archects

NewarkWorks
ICSC
Zeitgeist Consulting, Inc
The Coffee Cave
Smith Travel Research, Inc
ALM
Treasurer - State of New Jersey
Pitney Bowes Global Financial Services LLC

ASPIRA, Inc of New Jersey
Leadership Newark
pc/nametag, Inc
PURCHASE POWER
BizTech4ALL
Muller Bohlin Associates
5,009.66
5,009.55
5,001.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
5,000.00
4,998.32
4,950.00
4,725.00
4,715.00
4,667.12
4,500.00
4,500.00
4,500.00
4,475.00
4,455.00
4,420.57
4,350.00
4,246.40
4,240.00
4,202.35
4,129.95
4,052.00
4,000.00
4,000.00
4,000.00
4,000.00
4,000.00
4,000.00
3,985.54
3,972.78
3,960.00
3,922.50
3,903.81
3,858.18
3,800.00
3,786.00
3,750.00
3,738.41
3,552.96
3,500.00
3,500.00
3,500.00
3,500.00
3,464.94
3,456.00
3,443.36
3,303.40
VillageProfile
Elance,Inc
MotivaPromotionalItems
MetroCorpInteriorsInc
PropertyCasGroup
JohnsonJonesc/oLaurenceC.JohnsonJr.
GreenbergTraurigLLP
LinearElectric,Inc
AndrosDiner
VerizonOnline
UrbanLandInstitute
UStravelAssociation
AfricanAmericanChamberofCommerce
ImmanuelAdeola
Simoes&AssociatesPC
ToddNoonan
TrenkDipaspualeDelleFera&sodono
A&JManagement,Inc
WACHTEL&MASTR,LLP
AICPA
H10AConsulting
GLOBALDEVELOPMENTCONTRACTORS
PlasticardLockTechInternational
UniqueMoultriesLLC
FranklinSt.John's
MichaelO'Brien&sons
RenaissanceNewark
DavidOrtner
RealEstExCouncil
STAPLES
GlobalTradeMagazine
PSEGEconomicDevelopmentLLC
SBDCRutgers-Newark
DCISignsandAwnings
CablevisionOPtimun
Art&theCity
LaVozNewspaper
SouthernCTSportCourt
WBMason
LindseyFischback
RPMDevelopment,LLC
RyanG.Johnson(E)
ChristinaCorea(E)
BrendanHermes
ClixLocalMediaLLC
Countmein
DesignsensoryInc
EssexCountyVocationalschool
GaryLiss
LeadersMagazine
LeanStartupMachine LLC
RotaryClubElizabeth
TheKurzerGroupLLC
BaratFoundation
AmericanBusAssociationfoundation
GreaterNewarkEnterpriseCorp
PORTAPrintPublishingInc
Elance, Inc
Motiva Promotional Items
Greenberg Traurig, LLP

Andros Diner
Verizon Online
U. S. Travel Association
African American Chamber of Commerce NJ
Immanuel Adeola
Simoes & Associates
A & J Management
AICPA
H10A Consulting
FSJ Community Center

Renaissance Newark Foundation
David Ortner (E)
Rutgers University/ASBDC at Rutgers - Newark

Newark Arts Council
La Voz
Lindsey Fischbach
Ryan G. Johnson (E)
Christina Corea (E)
Brendan Hermes
Gary Liss
LEADERS MAGAZINE, Inc
Rotary Club of Elizabeth
American Bus Association Foundation
Greater Newark Enterprise Corporation
PORTA PRINT PUBLISHING, INC
3,295.00
3,250.68
3,239.20
3,235.50
3,228.13
3,200.00
3,168.55
3,164.88
3,114.25
3,082.57
3,080.00
3,055.00
3,005.00
3,000.00
3,000.00
3,000.00
3,000.00
2,970.00
2,960.00
2,943.33
2,900.00
2,880.00
2,835.55
2,800.00
2,750.00
2,750.00
2,750.00
2,720.90
2,705.64
2,701.85
2,700.00
2,678.20
2,637.00
2,635.00
2,604.22
2,600.00
2,600.00
2,600.00
2,582.19
2,550.00
2,550.00
2,504.53
2,502.38
2,500.00
2,500.00
2,500.00
2,500.00
2,500.00
2,500.00
2,500.00
2,500.00
2,500.00
2,500.00
2,477.79
2,450.00
2,450.00
2,388.50
ShaneseWinston
SoVeryDesign
WhiteEalgePrinting Corp
NJTravelIndustryAssociation
FranciscanCharities,Inc
Henry Flores (E)
SimplyRobbinMoonglowEnt
Centerplate
NewarkPoliceDept
SilverCloudInc
FASTSIGNSOFNEWARK
YaminahSpotswood
CommunityFoundationofNJ
Option1RealtyGroupLLC
GraphicsHousePrintingInc
RICHLANLUPOASSOCIATES
CentralParkingSystem
Seliger-Braun,Inc
NewJerseyChamberofCommerce
SIGNSOURCE
FeuryImageGroupInc
StateofNewJerseyDept.ofLabor
NewarkYouthAtleticFoundation
AAADInc
NelsonGonzalez (E)
YvonneMukase
SIGNALSIGNCo
FXEnterpriseLLC
RooseveltJ.Donat
Chanda Dawadi (E)
TriNet
RobertThomas(E)
ToyBrickPlace
Greenwood, Stephenie
ARROWPROMOTIONALGROUPLLC
AlphaAlphaLamda
constantCantact
Screenvision
ScottWelfel
HodgesPartyRental
CSC
NewarkMuseumAssociation
AfricaNewarkInternational
D&B
Hetrick-MartinInstitute
KatieHimmelfarb
PositiveImpactLLC
ThelLeadershipgroup
KevinNewell(E)
NewarkBears
ProfitMarkcomm
AnthonyFrasier
Courtyardbymarriott
Emily Manz (E)
MWWGROUPLLC
ARoyalFlushInc
DNAPRINTING
Jessica L. Pitta
NJ Travel Industry Association
Henry Flores (E)
STATE OF NEW JERSEY

AAAD, Inc
Nelson Gonzalez (E)
Roosevelt J. Donat
Chanda Dawadi
CSC
AFRICA -NEWARK INTERNATIONAL
Katie Himmelfarb
Kevin Newell (E)
Newark Bears
Courtyard by Marriott/ Newark Downtown
Emily Manz (E)
2,325.00
2,300.00
2,275.00
2,250.00
2,230.00
2,228.03
2,208.00
2,127.24
2,123.52
2,100.00
2,078.25
2,073.00
2,000.00
1,975.00
1,973.00
1,950.00
1,904.00
1,890.22
1,870.00
1,865.02
1,864.53
1,802.58
1,800.00
1,796.00
1,782.76
1,781.79
1,750.00
1,735.00
1,705.12
1,692.89
1,685.00
1,683.32
1,637.01
1,613.15
1,611.00
1,600.00
1,596.00
1,584.00
1,560.00
1,540.00
1,523.00
1,505.00
1,500.00
1,500.00
1,500.00
1,500.00
1,500.00
1,500.00
1,418.89
1,400.00
1,400.00
1,370.00
1,363.60
1,361.47
1,317.44
1,291.00
1,263.00
Careerbuilder
IrshadAlternatives LLC
TRUMPIA
WelfDorr
SageSoftwarechecks
ReliefHomes,LLC
ETHIXVentures
TDBankNA
Transitchek
HarvestTableFreshFoodEatery
ARAMARK
GlobalcorporateXpansion
GlobalPhilanthropyPartnership
MakersRow,Inc
Newarkprintshop
PortugueseAmericanChamberofCommerce
RebeccaGarcia
websignaLLC
NCarty&SonsContractingCorp
SAGE CHECKS & FORMS
Global Philanthropy Partnership
1,257.00
1,210.00
1,200.00
1,200.00
1,147.19
1,141.02
1,130.00
1,082.83
1,050.30
1,006.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
997.11
APPENDIX A
DOCUMENTS PROVIDED
a) Annual Audited financial statements for years ending December
31, 2010 -2012
b) )Interview responses and comments provided by:
1. Victor Emenuga
c) Form 990 tax exempt tax returns downloaded from GuideStar
for years 2010-2012
d) Agreement between BCDC and the City of Newark for annual
funding
e) Contract Agreement and invoices for activities of the Newark
Office of Film and Television
f) Payroll and compensation reports provided by the payroll
department for years 2007 to 2013
g) Contract Agreement and invoices for activities of the National
Development Council, outsourcing of loan administration
h) Loan schedules, agreements and loan files in support of loans
made for all loans provided by BCDC
i) Bond assistance program agreements, reports and invoices
j) Detailed general ledger activity for limited accounts and
supporting invoices form vendors
k) Limited Board meeting minutes 2008-2012
l) Legal invoices in support of payments to law firm for various
legal services provided
APPENDIX B
ASSUMPTIONS AND LIMITING CONDITIONS
This report is subject to the following assumptions and limiting conditions:
1. The information, estimates, and opinions contained in this report are obtained
from sources considered to be reliable. However, we assume no liability for such
sources. The information supplied by management has been accepted as correct
without further verification, and we express no opinion on that information.
2. Possession of this report, or a copy thereof, does not carry with it the right of
publication of all or part of it, nor may it be used for any purpose by anyone
without previous written consent of OConnor Davies, LLP and, in any event, only
with proper attribution.
3. The report reflects facts and conditions existing at the report date. Subsequent
events have not been considered, and we have no obligation to update this
report for such events and conditions.
4. This report was prepared under the direction of Keith S. Balla, CPA/CFF/
PSA/FCPA. Neither the professionals who worked on this engagement, nor the
members of OConnor Davies, LLP have any present or contemplated future
interest in the Organization, any personal interest with respect to the parties
involved, or any other interest that might prevent the performance of an unbiased
evaluation. Our compensation is not contingent on an action or event resulting
from the analysis, opinions, or conclusions in, or the use of, this report.
5. The procedures used to prepare this report are not sufficient to constitute an
examination made in accordance with generally accepted auditing standards.
Any information that we were not made aware of could materially affect our
opinion, and we therefore reserve the right to amend our report should any other
information be provided to us, which, in our opinion, requires such an
amendment.
APPENDIX C
Keith S. Balla
Principal
OConnor Davies, LLP
Certified Public Accountant
Public School Accountant
Certified in Financial Forensics
Forensic Certified Public Accountant
201-341-0678
kballa@odpkf.com
Keith S. Balla is a Principal in the Cranford, New Jersey office. Keith oversees the
Government and Business Litigation groups. In this role, he supervises and manages
staff accountants, managers and partners for all business litigation and forensic
accounting engagements. He has been instrumental in assisting attorneys with expert
testimony and consulting to achieve the desired outcome for the clients.
With more than 25 years experience in private industry and public accounting, Keith has
mastered several unique approaches to auditing and investigative accounting that have
proved extremely successful for clients which include the State of New Jersey, Essex
County, City of Newark, East Orange, Jersey City, Woodcliff Lake and Plainfield. He
has consulted for several New Jersey Boards of Education including Newark, Union
Township, Jersey City, Vineland, Lakewood and Princeton.
Keith began his career as an auditor for Midlantic Banks, one of New Jerseys largest
banks, and holding company for several statewide banks. It was there that he initiated
and participated in an internship program with Rutgers University to train students for a
career in banking. Additionally, he performed both financial and operational audits of
branches in the Central Region and audits for internal departments, including the
Comptrollers and legal departments. He was also a financial accountant for a multinational importer of footwear and furniture in New York City, directing General
Accounting preparation for worldwide operations.
In 1981 he moved from private industry to public accounting with Rosenfarb Winters,
LLC which later became Marcum, LLP.
A graduate of Rutgers University with a B.A. in Accounting and Economics, Keith
earned his CPA certificate in 1983. He is licensed to practice in both New Jersey and
New York. A frequent speaker, Keith shares his forensic investigating knowledge with
others and has appeared on several broadcast news segments as an authority on
various tax and white-collar crime investigation issues. He produces and hosts a halfhour interview broadcast program featuring some of New Jerseys most influential
business leaders. In addition, he has contributed to the Forensics and Accounting

textbook.
Keith has presented seminars to the New Jersey State Bar, Essex County and Union
County Bar, New Jersey Trial Attorneys annual conference, New Jersey Corporate
Counsel Assoc., and seminars for certified fraud examiners and New Jersey
Department of Insurance Auditors, and the League of Municipalities. He served as
Treasurer of the SELC District of the Lutheran Church Missouri Synod for 15 years and
has assisted numerous not for profit Boards. In addition, he has hosted the cable
television program, Its All About Money, appeared on NJN, News 12 and CN8 and
was featured in Practical Accountant magazine. Keith also appeared on Dateline NBC
as an expert regarding an investigation into the lavish lifestyle and extravagant
spending of a televangelist.
Professional and Civic Affiliations for Keith S. Balla
Past President, New Jersey State Board of Accountancy
American Institute of Certified Public Accountants
New Jersey Society of Certified Public Accountants
New York State Society of Certified Public Accountants
Past Treasurer, The Drumthwacket Foundation, Inc.
Past Treasurer, Island Beach State Park Preservation Foundation, Inc.
Past Treasurer of the SELC District Lutheran Church Missouri Synod
Former Board of Director YMCA of Newark, New Jersey
Past Trustee NJSCPA
President of the Zion Lutheran Church in Clark, NJ
Past President of Rotary Club of Newark
Founder of African American Cultural and Education Center, Inc.
Former Board Director of the Teen Challenge of New Jersey
Past Treasurer and Trustee of the Donald Jackson Neighborhood Corporation of
Newark, NJ
Board of Director, DARE New Jersey, Inc.
APPENDIX D

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Brick City Report

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BRICK CITY DEVELOPMENT CORP

Brick City Development Corp.

Dear Mr. Rolley:

OCONNOR DAVIES, LLP

Keith S. Balla, CPA, CFF, PSA, FCPA

OCONNOR DAVIES, LLP

SCOPE OF SERVICES ...................................................................................................... 1

ANALYSIS OF OPERATIONS ........................................................................................... 3

ANALYSIS OF ONE TIME FIRST MOVERS LOAN PROGRAM ........................................ 6

ANALYSIS OF GROW NEWARK LOAN PROGRAM ....................................................... 13

ANALYSIS OF URBAN ENTERPRISE ZONE (UEZ) LOAN PROGRAM ....................... 14

ANALYSIS OF DEVELOPMENT PROJECT ASSISTANCE PROGRAM ......................... 16

ANALYSIS OF SMALL BUSINESS ASSISTANCE PROGRAM ....................................... 18

ANALYSIS OF CONVENTION AND VISITOR BUREAU ACTIVITIES .............................. 20

ANALYSIS OF NEWARK OFFICE OF FILM AND TELEVISION ACTIVITIES .................. 23

ANALYSIS OF BONDING ASSISTANCE PROGRAM ACTIVITIES ................................. 26

ANALYSIS OF VENDOR INVOICES, AGREEMENTS AND PAYMENTS ACTIVITIES. ... 28

EXHIBITS AND APPENDICES

APPENDICES (D-L ELECTRONIC VERSION ONLY)

h) Loan schedules, agreements and loan files in support of loans made

ANALYSIS OF ONE TIME FIRST MOVERS LOAN PROGRAM

the project is not completed in 36 months then it is considered to be in

Interest rate of loan 5%

Quote from CAM_LPCCD 1.25.11 document (Credit Approval

Recommendation on The One Time First Movers Loan Program:

ANALYSIS OF GROW NEWARK LOAN PROGRAM

ANALYSIS OF URBAN ENTERPRISE ZONE (UEZ) LOAN PROGRAM

ANALYSIS OF DEVELOPMENT PROJECT ASSISTANCE PROGRAM

a) CityPlex 12 - $1,200,000 was provided in a form of a loan to finance

No evaluation of the results of these development projects was performed by

ANALYSIS OF SMALL BUSINESS ASSISTANCE PROGRAM

no follow up documents to support if the program increased new business or

ANALYSIS OF CONVENTION AND VISITOR BUREAU ACTIVITIES

ANALYSIS OF NEWARK OFFICE OF FILM AND TELEVISION ACTIVITIES

who were paid for the establishment and

ANALYSIS OF BONDING ASSISTANCE PROGRAM ACTIVITIES

ANALYSIS OF VENDOR INVOICES, AGREEMENTS AND PAYMENTS

Our analysis of Vendors focused on invoices, payments, agreements and activities as

Recommendation on The One Time First Movers Loan Program:

Recommendation Small Business Assistance Program:

5 year expense total

Loan management fees

SUPPORT AND REVENUE

Total support and revenue

First Movers Loan Fund

Loans written off or

Fund total = $3,276,453

UEZ Loan Fund

Loans written off or

Akerman Senterfitt, LLP

Sun and Moon Communication, Inc

PENTON MEDIA, INC

Newark Workforce Investment Board

FUND Consulting, LLC

INFERNOLIMITS PAINTBALL & LASERTAG LLC

Dan Jennings (E)

Gibson Media, Inc

M / RUIZ DESIGN, LLC

Ironbound Film and Television Studios, LLC

Nathan Cooper (E)

MARAZITI FALCON & HEALEY, LLP

Greener by Design LLC

Rogers Marvel Architects, PLLC

New City America, Inc