The City Council on Monday night will hold a public hearing and final approval for a financial agreement that includes a Payment In Lieu Of Taxes (PILOT) for the Rahway Residence for the Arts to pay the city at least $33,000 annually. Mayor Rick Proctor also is expected to deliver the State of the City address at the same meeting.
Tag Archives: PILOT
Council moves forward on arts housing measures
The City Council passed a series of measures last month to move forward with a proposed affordable housing development geared toward artists at the former Elizabethtown Gas building.
Ordinance 3-13 — introduced Jan. 14 and up for final approval on Feb. 11 — would execute a financial agreement between the city and the AFHDC for the affordable housing project, for a term not to exceed the agency’s mortgage for the project, with an annual fee to be determined as a percentage of annual gross revenues, not to exceed 20 percent.
The city would collect between $33,000 and $38,000 based on 6.2 percent of a projected $617,000 in gross rents, according to Redevelopment Director Peter Pelissier. That percentage was requested by the developer but is still under negotiation with the Redevelopment Agency, he said, adding that the length of the mortgage has not been agreed to yet. The property is currently assessed at about $500,000, making for an annual property tax bill of about $30,000. The Redevelopment Agency is negotiating the purchase of the site at Central Avenue and Hamilton Street from AGL Resources, the parent company of Elizabethtown Gas.
Also up for final approval at the Feb. 11 council meeting will be an ordinance (O-3-13) to amend the redevelopment plan. Representatives of the Actors Fund Housing Development Corporation (AFHDC) are expected to appear at one of the February council meetings to address questions about the proposal.
A resolution (AR-4-13) also approved by council declared the project will meet an existing housing need and that the Redevelopment Agency will make a mortgage loan to the AFHDC, which will construct, own and operate the 69-unit facility.
Ordinance 2-13 would amend the Central Business District (CBD) redevelopment plan for Block 167, Lot 1 (the former Elizabethtown Gas Building), stipulating permitted principal land uses and permitted bulk standards (including up to 75 units per acre, a maximum four stories/50 feet, and minimum lot area of 30,000 square feet), and minimum number of parking spaces (1 per unit, with a maximum 0.33 spaces per unit provided on site).
The AFHDC initially proposed 60 units but has since increased the idea to 69 units and the organization recently came before the Redevelopment Agency with survey findings it believes show very strong demand for artist housing. They told the agency that additional low-income housing tax credits for Hurricane Sandy-affected areas are included in legislation that was considered by the House of Representatives on Jan. 15. Original development costs were estimated at $15 million, based on the 60-unit plan, including subsidized low-income housing tax credits of 4 to 7.5 percent.
Council unanimously approves PILOT
The City Council unanimously (8-0) approved a 15-year PILOT for Meridia Lafayette Village at its meeting Monday night that will nearly halve the developer’s overall property taxes while providing more revenue directly to the city than it might typically get once the project is built out.
PILOT would shave about $170k off annual taxes
The City Council on Monday will consider a 15-year Payment In Lieu Of Taxes (PILOT) for Meridia Lafayette Village that would reduce its annual property tax bill by as much as 40 percent.
Continue reading PILOT would shave about $170k off annual taxes
PILOT proposed for Meridia Lafayette Village
The City Council will consider another 15-year Payment In Lieu of Taxes (PILOT), this time for the 115-unit Meridia Lafayette Village. The PILOT would call for an annual payment to the city of about $156,000, or about $1,356 per unit, based on 10 percent the project’s annual gross revenues, according to the ordinance (O-24-12).
Continue reading PILOT proposed for Meridia Lafayette Village
Groundbreaking for St. Mary’s senior housing
A groundbreaking ceremony will take place Wednesday morning for a senior housing facility on the Divine Mercy Parish (formerly St. Mary’s) church property. The four-story, 51-unit facility will be built along Esterbrook Avenue, near Central Avenue, where the former St. Mary’s convent once stood. Construction should begin shortly after groundbreaking and is expected to take at least a year.
The convent building was razed about two years ago, and about this time last year, the Zoning Board of Adjustment approved the application. It first was proposed to the City Council in late 2007.
The Jack and Margaret Myers Senior Residence is a Section 202 project for very low-income elderly, with financing from the federal Department of Housing and Urban Development and the Union County Department of Parks and Community Renewal, among others. Domus Corporation is the development arm of the Archdiocese of Newark, which will provide a 40-year Payment In Lieu of Taxes (PILOT) to the city.
The 44,456-square-foot facility is expected to cost $8.9 million and include green building features, such as energy-efficient, fiberglass windows, Energy Star-rated appliance and lighting, high-efficiency heating and cooling equipment, and low-flow water fixtures.
Tax break could run as much as $160k/year
The 10-year Payment In Lieu of Taxes (PILOT) for Meridia Water’s Edge will reduce the property tax bill on the rental development by anywhere from about $85,000 to $160,000 annually. Over the next decade, that could mean a minimum savings of $1 million to $1.6 million, and likely much more as taxes rise.
Almost $1 million in PILOTs in 2012 budget
The $49-million municipal budget anticipates almost $1 million of revenue from various PILOT (Payment In Lieu of Taxes) agreements, including the first from one of the Park Square properties.
The total $961,000 in PILOT revenue is up from the $783,000 in the 2011 budget and breaks down as follows:
* Lower Essex St – Denholz Management (Rahway Plaza Apartments) – $366,000
* Landmark – $150,000
* Parking Authority (River Place) — $170,000
* Rosegate — $25,000
* Senior citizen housing — $250,000
Landmark, which broke ground on the Irving Street side of Park Square (2 Park Square) in 2006, appealed its assessment in Tax Court, getting it reduced from $6.05 million to $4.077 million.
The Main Street side (1 Park Square) is assessed at $8.965 million.
The PILOT agreement had the developer paying taxes on the assessed value of the parcels as they previously existed. Landmark will begin paying 20 percent of its assessment this year, which will rise 20 percent each year until it reaches 100 percent (which would be 2016).
River Place was constructed on property owned by the Parking Authority, which receives an annual payment from the development’s owner and splits it roughly in half with the city.
The city budget also anticipates $660,000 in revenue from red light camera fines. About $1 million was realized in the Transitional Year budget, which covered the six months of July-December 2011.
The amount to be raised by taxes in the budget is $33.455 million. The proposed municipal tax rate for 2012 is 2.287 (per $100 of assessed value), so the average assessed home ($133,000) would see municipal taxes of $3,042, compared with $3,046 estimated last year. (Remember, municipal taxes make up only a portion of your overall property tax bill; the others being schools and county). Presented to City Council by the administration in February, the municipal budget will be up for a public hearing and vote at the March 12 meeting.