The Port Authority of New York and New Jersey has used a $2.4 million security deposit to pay part of $2.8 million in back rent and fees owed by the port’s largest auto import processor.
The port authority had advised Foreign Auto Preparation Service that if its back rent was not paid, the agency would tap the company’s security deposit. The company’s lease requires the deposit to be replenished.
“We drew down on FAPS’s $2.4 million line of credit to cover a portion of the back rent and we will be monitoring their compliance with the lease,” said Steve Coleman, a port authority spokesman.
FAPS, which has operated at Port Newark since 1956, handles about one-third of the port’s auto volume.
Company representatives said FAPS fell behind during the recession and the aftermath of last year’s Japan earthquake and tsunami but has been current with recent payments and has been chipping away at overdue payments.