HOBOKEN — Two property owners have filed a new lawsuit against the city and the developers of a 20-story hotel planned for the Hoboken waterfront, alleging their revised development agreement is illegal.

The lawsuit filed by Hoboken Land Building and Hoboken Holdings comes nine months after the two companies filed a similar complaint against the city and the hotel’s developer, KMS Development, and won.

The initial suit asked a Hudson County Superior Court judge to nullify an agreement that would have allowed KMS Development to build a Hilton Hotel at the corner of Newark Street and River Street, where the historic Frank Sinatra Post Office has stood since 1931. Under the terms of the initial agreement, the developer would have contributed more than $4 million to the city for infrastructure upgrades and local organizations, in exchange for allowing the project to expand in size.

In a March 26 ruling, Judge Anthony V. D’Elia wrote that requiring money in exchange for planning amendments will “create an unacceptable possibility for abuse and fraud.”

The city and KMS drew up a new development agreement earlier this year, which Hoboken Land Building and Hoboken Holdings is once again challenging in court. The companies’ Aug. 2 lawsuit alleges the new agreement requires KMS to make a $3.2 million “giveback payment” into an escrow account controlled by the city — money that will be used for “unspecified and undetermined purposes."

Like the first lawsuit, the new complaint alleges the payments constitute "a blatant quid pro quo,” and the agreement should be declared null and void by the court.

In a statement, KMS said the lawsuit is “fundamentally flawed and grossly misrepresents” the agreement the city and developer made this year.

“These funds are to be used for a narrowly defined set of uses that are specifically related to ‘the impact of the Hotel on infrastructure, the community and community services.’ The Agreement provides eight (8) examples of these types of public purposes including flood control, enhanced storm retention, open space, improved bicycle and pedestrian access, etc.”

“We listened to Judge D’Alia’s concerns with the prior agreement. We are confident that the 2019 Redevelopment Agreement successfully satisfies the points made in the Court’s decision..." KMS said. "The waterfront hotel project is continuing to move forward with the support of the City and the residents of Hoboken.”