Financial concerns by EDA threaten to halt effort to bring satellite location of Pompidou Center to Jersey City

In letter to Jersey City Redevelopment Agency, EDA CEO says ‘substantial’ operating gap in business plan prevents organization from releasing $34M in appropriations and tax credits

The effort to bring a satellite location of the world-famous Pompidou Center in Paris to Jersey City — an opening that would be a huge plus for the cultural aspirations of the city and state — appears to be in question Friday morning, due to financial concerns by the New Jersey Economic Development Authority that are holding up significant funding on the project.

The EDA, in a letter from CEO Tim Sullivan to Diana Jeffrey, the executive director of the Jersey City Redevelopment Agency, questioned the viability of the business model the JCRA recently presented to the EDA in relation to the $34 million in appropriations and potential tax credits the EDA has granted the center under the recently enacted Cultural Arts Incentives Program.

The EDA has requested an updated proposal from the JCRA by May 26.

Sullivan, in the letter, said a substantial annual operating gap of nearly $19 million “remains too significant to release any funding at this time.”

Sullivan wrote: “Based on the information you provided us, JCRA has identified annual revenue of slightly less than $4 million annually, and recurring expenses of more than $23 million — for an annual operation shortfall of approximately $19 million.

“While we are eager to continue working with you on the CPxNJ project, the annual operating gap remains too significant to release any funding at this time. As you know, none of the $34 million appropriated to the project via the NJEDA has been released due to the lack of balanced sources and uses and operating plan. With federal funding deadlines looming and the state budget process underway, it is clear that we must meaningfully narrow this gap.”

The Centre Pompidou × Jersey City, which would be Pompidou’s first satellite in North America, would give visitors a sampling of the Pompidou’s more than 120,000 pieces of art through exclusive exhibitions, while serving as a cultural hub of learning.

When announced in the summer of 2021, its potential arrival was hailed as a huge win for the arts in Jersey City and the state as a whole.

The path forward is not clear.

Sullivan said the EDA still supports the project, but said it needs to an updated business model in the next 30 days that justifies the state funding.

Sullivan wrote: “We kindly request an updated revenue and expense model for the CPxNJ project that rectifies the annual operating deficit. If JCRA cannot provide an updated model by May 26, 2024, we will have to consider whether it is more prudent for the state to use these funds for other fiscal priorities that the Legislature and governor might identify through the budget and federal fund process. “

ROI-NJ was unable to immediately contact the Jersey City Redevelopment Agency for comment.

Sullivan, in his letter, expressed hope that a solution can be found, offering assistance in the process.

He wrote: “We are more than willing to continue collaborating closely with JCRA to provide any necessary insights and support, as the NJEDA firmly believes this project would be tremendously beneficial for Jersey City and the entire state of New Jersey.

“We remain hopeful that JCRA can identify sustainable solutions that would allow the CPxNJ project to move forward.”