Hampshire Self Storage in Bloomfield, NJ, Gets Council Approval for Phased-In Tax Program
Copyright 2014 by Virgo Publishing.
By:
Posted on: 09/12/2013



 

A proposed self-storage development in Bloomfield, N.J., received approval this week from the city council to phase in the taxes on the building over a five-year period. The township program, called PILOT or Payment in Lieu of Taxes, only applies to taxes on the building. The land will continue to be taxed at its present rate. Although the property is currently zoned central business district (CBD), the zoning board granted a use variance and approved the site plan for Hampshire Self Storage in November 2012.

PILOT would allow the self-storage business to make a five-year series of payments totaling $675,000 to Bloomfield, according to a developer’s estimate. The property at 104 Orange St., which is presently occupied by a vacant building, has an annual tax bill of $62,000. Payments made through a PILOT program go directly to the municipality, a key difference from a standard N.J. property bill, in which the municipality, school district and county each receive a portion of the taxes.

During the council meeting, the township’s tax assessor, Joe Pisauro, explained how the PILOT program works. It will stretch the building tax over a five-year period, at which point it would end and the standard tax rate would apply. Mayor Raymond J. McCarthy said the township would benefit from the program, gaining an additional $25,000 over the current tax revenue.

However, not everyone was on board with granting the PILOT program for the self-storage development. In the 6-1 vote, Councilman Bernard Hamilton voted against the agreement. During the meeting, he said the “for-profit” nature of the business didn’t lend itself to approval for the PILOT program and didn’t provide “tangible” benefits to the town. Hamilton said he’d rather see PILOT programs extended to more community-minded projects. In addition, residents have also voiced their concerns during council meetings. Councilman Michael Venezia will host a public forum on Sept. 24 to address these residents’ concerns and questions. He said it will “dispel misinformation and provide the public with facts” about tax abatements/PILOTs and explain why they are used.

Mayor McCarthy and Councilman Nicholas Joanow said the vacant property hasn’t attracted many developers. Joanow said while he’s not “thrilled” about approving the PILOT program, at least it offered the township revenue.