BAYONNE, NJ—The 2010 purchase of 131 acres of waterfront land here by the Port Authority of New York and New Jersey, hailed at the time as a means for expansion of regional port facilities, was in fact a fiscal bailout for the City of Bayonne, according to a published report.

With the exception of a 544-unit apartment complex, the waterfront peninsula purchased by the Port Authority for $235 million remains unused. At the time the deal was negotiated between the Port Authority and Bayonne, the City of Bayonne was on the verge of bankruptcy, facing a shortfall of as much as $33 million, and possible state oversight of its finances according to the New York Times.

“That was a straightforward fiscal bailout of Bayonne,” a former Port Authority official familiar with the negotiations who spoke on the condition of anonymity in order to preserve relationships at the agency told the newspaper. “It all sounds really great, but scratch the surface, and it is worth nothing to the authority.”