| Author | Message | ||
     doublea Citizen Username: Doublea Post Number: 139 Registered: 3-2003 |
Mayhew: Excuse the double posting. You tips to Ed are useful to me as well. I was going to have my son show me when he visits, and no, I'm not adopting you. | ||
| Eric DeVaris Citizen Username: Eric_devaris Post Number: 14 Registered: 2-2003 |
I read this thread every day for my edification and, although most of it goes over my head, I am in awe of the ample knowledge and wisdom that flows in our midst. I am also frustrated that such wisdom remains unexploited. It is obvious that Doublea, Washashore, J.Crohn, Woodstock, and others, have a thorough understanding of the financial implications of pilots and taxes. It is also obvious that they are all interested in the economic health of our Village, otherwise they wouldn’t spend so much time on this board, till the wee-morning hours, sharing their thoughts and developing their admirable mathematical theories. On the other hand I see this extensive post of Mr. Matthews, sharing whatever information he can with this board, and trying to respond to the arguments presented here. And then I dream. Wouldn’t it be great if all those knowledgeable people sat down around a table and discuss pilots and taxes face-to-face? Wouldn’t it be great if the decision makers of this town – our trustees - were exposed to this pool of knowledge, listened to these arguments on pilots, and thus make informed decisions? Wouldn't it be better if these mathematical calculations presented here, were shared with a wider audience? Mr. Matthews is right: the trustees should not be expected to poll the residents for every decision they make; they are elected to make decisions without the need of a plebiscite for each one of them. And, yes, you’ll never get the majority of the residents interested enough on the subject. But the trustees, before deciding a crucial issue such as pilots, could seek those talented and knowledgeable on the issue residents, bring them around a table, listen to their views, and then make an informed and intelligent decision. At present the Village trustees are exposed only to the information presented to them by the Administration (Messrs. Gross and Matthews), and to their own knowledge. It would benefit the Village if our decision makers were also exposed to different views. There are pending projects that are considered for p.i.l.o.t. Now is the time to bring to light all the pros and cons. So, what say you, Doublea, Washashore, J.Crohn, Woodstock, and other posters on this thread knowledgeable with the pilot/taxes issue? Are you willing to sit around a table with Messrs. Gross, Matthews, and two trustees at a time, and discuss with them pilots, taxes? What say you, Mr. Matthews? Would such meeting benefit the community? I believe the issue is important enough to justify such meeting. That is why I am willing to be the facilitator of such a meeting. Those interested can e-mail me at ericdevaris@aol.com, and we’ll take it from there; your identity will not be divulged on this board, if you so wish. Or you can post on this thread your willingness to meet, and your availability. After such meeting(s), any of the participants would post here their informed views for the edification of the rest of us. Let’s make our enthusiasm for South Orange bear fruits by working together. Eric DeVaris | ||
| doublea Citizen Username: Doublea Post Number: 140 Registered: 3-2003 |
Eric: Your suggestion makes a lot a sense. I certainly am willing to meet and hope the others will as well; I'm sure they will. In addition to those you named, I would hope jimmurphy, vermontgolfer, bets, dgm, nywave and any others that want to will be there. I think that this would be a good cross-section of the community. I understand why you have suggested two trustees at a time, because of the sunshine laws, but that may be unwieldy and really time-consuming. We might be better off with a public meeting so everyone can listen and have their input. | ||
| doublea Citizen Username: Doublea Post Number: 141 Registered: 3-2003 |
Eric: As an aside, when you say you are in awe, I am as well as to what has transpired on this board. When my property taxes are $21,000 a year,and we have in South Orange three of the largest projects in the history of South Orange built or to be built (other than the Newstead), and one of those projects has been abated and there is considerable chance that the other two will be abated, and I am told that I really come out ahead because these projects are not included in S.O's tax base - I put pen to paper (or the back of an envelope as peteglider suggested) and look what happened. Yes, I am in awe. | ||
| J. Crohn Citizen Username: Jcrohn Post Number: 118 Registered: 3-2003 |
If I am not too busy cleaning my aquarium filter or planning the overthrow of the US government, I will meet with anyone who wants to meet to discuss PILOTs, but no one should presume anything about my "knowledge" of the subject, as whatever of it I possess is gained strictly through discussions of this sort. Mr. Matthews has done an heroic (and almost convincing) job of explaining the pro-PILOT position here. I will re-read his remarks a couple more times before attempting to frame any further questions of my own, but in the meantime I look forward to reading others' exchanges on the subject. Here is a slightly different set of directions for accomplishing a cut-and-paste: Open your favorite text program and type your post. Spell check the post. When you are ready to transfer your message to MOL, hold down the "Ctrl" button on your keyboard with one finger while pressing the letter "a" with another. This will "select" your entire text (the pull-down menu command that accomplishes the same thing is "select all," thus the "a"). Now hold down the Ctrl key again and at the same time press "c". This copies the post into your computer's short-term memory. Now log on to MOL (if you haven't already) and click your mouse once in the message window of the thread you want to post in. Again hold down the Ctrl key, and this time simultaneously press "p". This pastes the message into the posting window. You know the rest. Just remember: Ctrl a (select all), Ctrl c (copy), Ctrl p (paste). And by the way, I can't type worth a damn either. I think I manage to employ all of four fingers (on a good day). Probably there are enough of us here to form a club. | ||
| doublea Citizen Username: Doublea Post Number: 142 Registered: 3-2003 |
Having read J. Crohn's which said that Mr. Matthews explantion was "almost convincing,"I went back and read Mr. Matthews response, because I usually find J. Crohn's remarks to be on target. I have to say that upon a rereading, Mr. Matthews explanation is "almost convincing." I was most interested in Mr. Matthews response to David Lackey where he says "if we negotiate the PILOT Agreement, if one is granted, we should be able to do one that will not cost the taxpayers financially, using the pilot vs. non-pilot analysis." From my perspective,this is all that I am trying to insure. It would be interesting to hear other comments, and it seems even clearer than before that there should be a meeting. We seem to be making some progress and hopefully this can all be done in a constructive manner. | ||
| Washashore Citizen Username: Washashore Post Number: 17 Registered: 4-2003 |
Mr. DeVaris: Count me in on any community meeting that includes Messrs Gross and Matthews on whether To Pilot or Not To Pilot Beifus and the Supermarket/residential site. To be productive, such a meeting needs to pose the facts, relatively speaking, as to what the trade-offs would be, as doublea has attempted to do, so that we can have meaningful discussion. I suggest that Mr. Brian O'Leary attend, as it was his intelligence to begin with, I believe, that first exposed the issues associated with the PILOT for Gaslight Commons. An open invitation to attend such a meeting should be extended to the entire community as well because "liberty cannot be preserved without a general knowledge among the people...of the character and conduct of their rulers" (John Adams, 1765). I worry, though, that Mr. Matthews' 5/24 response suggests that this Administration, flush with new victory at the polls, will decide behind closed doors, what is "best" for S.O. and its residents. Anyone have any suggestions on how to ensure that while we are discussing how to hold a community meeting on the benefits or lack thereof of new PILOTS, the BOT and Administration aren't signing away our future? | ||
| bets Citizen Username: Bets Post Number: 323 Registered: 6-2001  |
Though I haven't had time to dissect Mr. Matthews's post, I do have one recurring thought: What do any of us presume to know about the future? Thirty years is a heck of a long time. Compare the events and society of 1973 to current events and society now. Though there may be forecast increases on payments from LCOR, who knows what will be the norm in 10, 15, 20 years, etc.? Telecommuting may obsolete the Midtown direct. The current downtrend in the market could boost affordable housing in NYC itself, causing the suburbs themselves to become obsolete. The plain truth of the matter is that PILOT was introduced mainly for protecting open spaces and for seriously blighted cities such as Camden, Newark, and East Orange. I truly hope that we, as a town and village, do not view ourselves as "blighted." I propose that our land and our village are valuable, and that any development approved would embrace that value and add to it proportionately. I'm currently in Boston for the holiday weekend, and haven't had the time to process all of the posts here since yesterday afternoon. I'm going to resist doing so until at least Monday, but I'm really grateful that the few people who objected to the Gaslight PILOT (based on little to no communication on the benefits) has turned in to a more diverse base of citizens that care. That gives me hope. | ||
| J. Crohn Citizen Username: Jcrohn Post Number: 119 Registered: 3-2003 |
Although the article linked below is over a decade old, it provides a lucid summary explanation of NJ tax abatement law and PILOTs. A fair amount of what has been discussed here is addressed. http://www.newjerseylaw.com/pubs/abatement.htm | ||
| woodstock Citizen Username: Woodstock Post Number: 147 Registered: 9-2002 |
Mr. Matthews, As other have already done, I wanted to thank you for taking the time to respond to the many posts on the subject of PILOTs. As you can see, most of us are simply interested in understanding as much as we can, and ensuring that the right thing is done for the town with these programs. I believe one thing that is of concern is not that we don't understand the way PILOTs work, but that the people making the decisions might be murky on the impact that a PILOT has on both town revenue, and the average homeowner's taxes. I would be happy to attend and participate in any meeting that could clarify what a PILOT is, the value they provide the town, and the benefits to the taxpayers. I would also hope that the Trustees and the President also attend similar meetings so that we can all have confidence that the people making the decisions have all the information they need, and fully understand the tools available to them. I don't mean this as a slight on the Trustees or village President. It is tough enough to fullfull a day job, but to then take on the resposibility of assisting to manage a town is a large burden. I appreciate the time these elected officials spend. As I said above, I simply want to make sure everyone has and understands the tools available. Mark | ||
| Edwin R. Matthews Citizen Username: Edwinrmatthews Post Number: 28 Registered: 3-2003 |
Having taken some time to let the dust settle from my last post I do get a sense that people are starting to understand a bit more about tax abatements and PILOT agreements. Before responding specifically to things raised by others a few general comments are in order. Back in 1993 when the redevelopment started in earnest and studies were done it was recognized that redevelopment in South Orange would be difficult because of our Tax structure and rates. One of the early reasons for considering designating an area in need of redevelopment was the ability to give tax abatements for development that was done. That is using tax abatements to faciltiate projects which were not financially feasible because of our tax structure and rates. Because a project always pays more taxes after an abatement with a PILOT the taxpayers are always better off than they were without the project. Doublea in your 5/24 9:27 A.M. post you raise the "blanket assertion" that "because the PILOT is not included in S.O.'s tax base for purposes of allocation between S.O. and Maplewood, this means that S.O.'s allocated share of the scvhool budget does not increase and therefore this must be good because otherwise the amount of school taxes paid by other S.O. taxpayers would increase." I think that statement was in response to an incorrect statement made by many that since the LCOR value was included in calculation for school tax purposes and LCOR did not pay taxes that the other village taxpayers had to pick up what LCOR was not paying but was added to South Oranges total. If the LCOR assessment were added to South Orange's total then LCOR would be on the Tax Rolls. I believe that any added taxes would be covered by its tax payment. I have read and rerread Mark's quote I think I know what he is trying to say but don't believe it comes through very clearly. Eric DeVaris in your 5/24 2:11 P.M. post you say you dream of people sitting around and discussing pilots and taxes face to face. The fact remains until the recent election when a lot of incorrect information and misinformation were put into the public debate no one showed any interest in tax abatements and PILOTS. While I stayed out of the public debate during the election I did write privately to a number of people who posted incorrect statements. I also offered to sit down with a number of people to discuss the issues. (I always suggest John Gross also participate because although I understand the numbers I am not sure I can adequately explain them and/or answer questions concerning them. Since the election I have posted several times suggesting such meetings either with small groups or to larger groups interested in learning about Tax abatements and PILOTS. John and I have discussed this and have generally agreed it is something we might be willing to do although no final decision has been made about when and where. If we go forward with such a meeting then John and I will be the facilitators for the meeting. Whether the Trustees would attend would be up the individual Trustees. (I am not sure that the open public meetings act would apply to such an information session.) Finally I disagree with your statement that the Village Trustees are exposed only to information presented to them by the Administration (Messers. Gross and Matthews), and to their own knowledge. The trustees have reached out to many people over the years to discuss the various issues and indeed have had a special redevelopment counsel since 1994. Initially is was Anne Babineau. (J Crohn posted a location of a site where one of Ms. Babineau's many articles on tax abatements and Pilots as well as redevelopment is located. That article was one of a number provided to the trustees to help them understand redevelopment issues including tax abatements and PILOT agreements) Ms. Babimeau was replace by Chris Hartwyk who has extensive knowledge of Planning and Zoning issues including Redevelopment , Tax abatements and PILOT Agreements. It must be understood that while the public should be knowledgeable about tax abatements and PILOT Agreements and can discuss the impact a particular PILOT agreement may have, the decision of whether to grant an abatement in a particular case is generally not one that is going to be made and debated with public participation because the decision to grant an abatement is going to be based largely upon confidential information only available to the Elected Officials and certain limited administrators of the Village. Any tax abatement and PILOT that is based on the assumption that without an abatement and PILOT that a project would not go forward results in a project that increases Village revenue and provides some relief to the taxpayers. The ultimate objective is to provide as much revenue to the Village and to maximize the relief to the taxpayers. In the case of LCOR that was done even using the PILOT vs Non pilot analysis. In reading doublea's post of 5/24 at 7:29 P.M. in which he quotes my response to David Lackey he points out I said "we should be able to do one [a PILOT] that will not cost taxpayers financially, using the pilot vs. non-pilot analysis." That statement should not be misconstrued. The term as used there actually means an agreement that provides a greater benefit to the tax payers. A pilot agreement never actually costs the taxpayers anything (since the project would not be built without it.) A pilot that provides less benefit to the taxpayers financially than they would get if there was no pilot (for the project) still benefits the taxpayers if it means a project that might not otherwise be built, is built. Bets the blight argument in your post of 5/24 at 8:30 P.M. was actually advanced in oposition to the Villages declaring portions of the central business district as an area in need of redevelopment. When the legal challenge was mounted against the Village the argument was again advanced and rejected by the courts. Indeed other municipalities are following South Orange's lead in using the redevelopment statute to address areas that are not to use your words "seriously blighted cities". Have a Happy Memorial Day. Please think of the families of the 194 soldiers, sailors, airmen and marines who have given their lives since last memorial day in the service of our country. Semper Fi! | ||
| J. Crohn Citizen Username: Jcrohn Post Number: 130 Registered: 3-2003 |
Hope everyone here had a good Memorial Day. Now, in hopes of pushing the envelope a little... Ed Matthews 5/24 12:54 am, addressing the need for density in development: “WITHOUT THE DENSITY AND THE TAX ABATEMENT THE LCOR PROJECT WOULD NOT HAVE BEEN BUILT. Indeed no residential project could have been built on that site.” [Emphasis mine. -JC] But why was a residential development in the best interests of the town? I thought it was axiomatic that we need commercial rateables more than we need additional housing. Frankly, part of my disappointment over the Gaslight development is that it was not commercial. I could have walked to a small shopping center at that site, or an office building, or a Borders, etc. On the other hand, couldn’t we have looked for a deal where the owner sold part or all of the site to the state or fed or some conservation agency as open space (it does border a park), and SO was compensated for the lost taxes with a PILOT? Making it a stand of trees and reaping a government PILOT might even have been a better deal than developing it for housing, getting a PILOT, and yet still having to provide city services. “Once the project was built the property owner went from an $80,000.00 tax payment to a $500,000.00 PILOT payment. That payment gets adjusted for cost of living and goes up by a formula so that in the last years of the PILOT the payment reaches to more than 80% of what the actual tax payment would be.” And this money goes to the town alone, as opposed to the town, the schools, and the county. Which is good--except that it has the effect of not funding our public school system. (I don’t give a hang about the county, but perhaps someone can tell me why I should.) Yes, because of the PILOT, S.O. taxpayers get a break on the projected increase in the municipal part of our taxes, and that break ostensibly compensates us for increasing taxes generated by school district budget increases. But let’s face it: schools everywhere are seeing less and less state and federal aid at the same time they are required to spend more on special ed and other mandates. Locally, competition from private schools means our district must spend both in salaries and in maintaining levels of educational quality in general. This must happen in order to keep able kids from opting out of the system, as well as to decently educate less able students. SO and Maplewood are in a particular bind because of our racial and economic diversity: integration, to be frank, is more expensive than homogeneity. Thus, the cost of public schooling should be expected to rise, and to rise faster than the cost of municipal services in general. By depending on PILOTs for development, it seems to me we avoid putting our money where we probably need it most, both for the sake of the intrinsic value of our schools and for maintaining property values: quality education, especially in a high-tax environment, is what draws families to towns like ours, and it is a much more important draw, even, than downtown development. Defending the regular use of PILOTs is like saying, 'I’d rather be paid in coupons to my local Chinese restaurant, even though what I really need is cash to pay down my rapidly rising rent.' “A PILOT does not go into the village’s total assessed value. More importantly, there is never an increase in the amount of school taxes paid by other taxpayers. What occurs is, the tax payers don't get a reduction in what they pay as school taxes. Over the length of the agreement this loss of reduction is made up for by the increase in the actual payment made to the village.” What happens if the Gaslight Commons is not profitable in any case? The owner will want to sell. He’ll probably be prohibited from selling by the terms of the PILOT, or else any sale will require the buyer to assume or renegotiate the PILOT agreement. In which case SO may never see that 80% of what LCOR would have paid in taxes, correct? “J. Crohn In response to yours of 5/23 at 11:14. If the village could have gotten a smaller development on the LCOR site without a tax abatement it would have jumped at the chance.” How does the Village go about soliciting development, and why is it that a smaller development—I’m not talking about a residential one—could not have been attracted? I’m aware that there was opposition from residents across the street to a proposed supermarket, but a) supermarkets aren’t the only possible commercial developments and b) citizen opposition hasn’t stopped every development in S.O. Why this one? You mentioned in response to a post by snshirsch that certain proprietary information concerning PILOTs is not available for public review. Can you clarify if this is the case for properties already developed, which already have PILOT agreements with the Village? Finally, are the Village’s cost-benefit analyses of PILOTs never released to the public? | ||
| jimmurphy Citizen Username: Jimmurphy Post Number: 129 Registered: 5-2001 |
Julie, et al, Just caught up with this thread and am very excited to see that this subject has seemed to go beyond the "tipping point" and that more and more people are expressing an interest. Although I haven't reviewed the Atlantic Report in a few years, I believe that the reason a residential development (of relatively small units) was recommended adjacent to the train station is because it would bring with it a customer base that would 1) be less inclined to drive, 2) be more inclined to shop in the downtown stores, thereby raising their value, assessments, and tax payments, and 3)would not inject a large number of children into the school system (again, due to the relatively small size of the units). All of these reasons make a tremendous amount of sense - at least to me. They are in keeping with the tenets of Smart Growth and Traditional Neighborhood Planning - a subject that I've had an interest in for a while. In fact, it was one of the reasons that we chose to live in South Orange along the train line instead of the hinterlands to the south and west. At this point, I'm also beginning to wonder if more commercial development might be appropriate and I'd love an opportunity to participate in any meeting like the one that Eric has suggested and Ed Matthews seems to have agreed to. Time and Place? Jim | ||
| mrosner Citizen Username: Mrosner Post Number: 404 Registered: 4-2002 |
I am back from vacation, but glad to see that SOL (why do people call it MOL) managed to keep going without my posts. I have not been asked nor has the BOT discussed with the developer of the Shop-Rite or the Beifus site about a PILOT agreement. My guess is they will both ask for one and make a case to the BOT as to why they should be given one. As I have said previously, a developer would have to make a very strong case for why a PILOT is needed and what they bring to the table that we should give them one. Ed Matthews did a pretty good job in his posts on here explaining PILOT's. A PILOT can be financially beneficial to the village and to the bottom line of the tax bill so it would be foolish to say I would never support one. It is a tool to bring forth a development that is better for the village than we would have otherwise have gotten. If and when the issue comes up, I would hope that there is a public discussion at the BOT meeting and that residents weigh in with their questions and comments. The only thing I always ask is that people keep an open mind and make decisions based on the facts that are presented and not on rumors or misconceptions about the BOT. Despite the comments of some, I do not think the BOT engages in closed session back room deals. If they do, they have been done without me. I do get information from many sources and I often discuss issues with friends and neighbors. As for Jim Murphy's question, I will let you know when we can have a public debate in an informal setting (maybe the Baird Center) with Ed Matthews and as many of the trustees that want to come. One thing I am trying to find out is how many other PILOT agreements exist in Essex County that negatively affect our county tax bill. | ||
| woodstock Citizen Username: Woodstock Post Number: 148 Registered: 9-2002 |
I am curious - why do the county and school district not have a say in a PILOT program? I could imagine I'd prefer to have a PILOT with the town and with the school (I'm all for funding schools...), and forget the county. I know it's only 18%, but that's about $4k to me. Don't the county and school board get upset that they're not getting a slice of the pie? | ||
| Edwin R. Matthews Citizen Username: Edwinrmatthews Post Number: 31 Registered: 3-2003 |
Just when I think everyone is beginning to understand the tax abatement and PILOT concept a question gets asked which shows there is still some misunderstanding. A tax abatement and PILOT agreement doesn't affect the amount of money either the school board or the county receives. It only affects the allocation of the amount received among those contributing to the school costs and the county costs. J. Crohn Jimmurphy gives the general rational for why there is residential at the LCOR site. In the early 1990's the zoning was changed so that residential was to be built on the site. There was litigation over the issue which the Village won. The Atlantic group report and all other indicators pointed to residential being the best use for the site. Although I have not done any numbers I would be surprised if the site would have brought in more revenue to the village if it was developed as a commercial site. It is very difficult , in fact close to impossible to get money to develop office space of any magnitude in South Orange. Many hours and significant efforts have been expended to locate developers and interest them in South Orange. (Nancy Adam Shippey devoted countless hours to the task.) There is only one tax abatement and PILOT agreement in South Orange ie LCOR. (The Village has several PILOT agreements with tax exempt properties eg Seton Hall which make payments to the Village.) The proprietary information I have referred to is financial information from the developer. It is submitted to the Village in confidence and is not available to the public. I am not sure what J. Crohn means by cost benefit analysis. In the case of LCOR the benefit was an additional $420,000 in revenue to South Orange in the first year. This reduces the amount that all of the other taxpayers have to pay by that amount. (If my math is correct that is approximately $50.00 per year for each $100,000 of assessed value for each homeowner.) | ||
| dgm Citizen Username: Dgm Post Number: 111 Registered: 5-2001 |
Mr. Matthews, I hate to bend statements around. It is an ugly business. However, in your statement of 9/27@ 9:30 if you change "among" to "from" in the second sentence, you will see why people are so stirred up. “A tax abatement and PILOT agreement doesn't affect the amount of money either the school board or the county receives. It only affects the allocation of the amount received among (change to from) those contributing to the school costs and the county costs. “ In the case of the county, those costs are well dispersed. Schools however, are expensive and paid for right here. It is also possible that the Maplewood/SO allocation theory/rationale may not be a permanent factor in the savings to the SO taxpayer with in the light of continually rising school tax requirements. | ||
| doublea Citizen Username: Doublea Post Number: 146 Registered: 3-2003 |
As some of you might know, Morristown is also a transit village. Morristown is experiencing a large amount of residential building in its downtown area. I just spoke to the Business Administrator for Morristown who is also the Executive Director of the Redevelopment Corporation. Morristown had looked at abatements or PILOTs and decided it was not the way to go. No PILOTs have been granted to any of the downtown development projects. There had been a redevelopment project where the developer had requested an abatement in order to build a larger project, and it was decided to go with a smaller project without an abatement, recognizing that the larger project might have brought in more tax dollars. dollars. | ||
| mrosner Citizen Username: Mrosner Post Number: 410 Registered: 4-2002 |
Usually, we want a smaller project and that is why a PILOT might be needed. With a large enough project I would guess an abatement would not be needed or desirable to give. The PILOT with Gaslight was done before we were made a Transit Village although I don't think that has an impact one way or the other. | ||
| doublea Citizen Username: Doublea Post Number: 147 Registered: 3-2003 |
Mark: I appreciate your comments on the Beifus and Shopright sites, that they will have to have a compelling reason to be granted PILOT status. Others have commented that if a PILOT had been necessary, it should have been asked for upfront. If the argument made is that the developer's agreement is negotiated afterward, and there are things that the village might request, I'm still not sure whether that deserves a PILOT in return. One thing that has not been mentioned is the precedent setting aspect of granting a PILOT. There are still some properties that at some point will probably be redeveloped, e.g. Third Street. If Beifus and/or Shoprite is given PILOT status, any future redevelopment will expect and demand PILOT status as well. Of course the question always is would that project have been built without a PILOT. Maybe we should stop at the Gaslight and say that it was the first redevelopment project and was given PILOT status because of its size and the amount of dollars it brought into the Village. After that, it's pay as you go. |
