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Re: 35-year tax break proposed for three-tower Journal Square project
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Every bill should have a plain English financial summary, be it an abatement, a bond issue, whatever:

- Impact to City budget year 1 to year n
- Impact to County budget year 1 to year n
- Impact to average residential property tax bill year 1 to n
- Impact to average business property tax bill year 1 to n

What we are currently getting is not the transparency we were promised.

Posted on: 2013/11/15 18:53
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Re: 35-year tax break proposed for three-tower Journal Square project
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It is subsidizing the developer because JC will now have increased population and the increased costs that go with servicing that population will only be partially offset by the abatement.

As for kids and toddlers... I lived in Grove Point for two years and there were a ton of children in that building, plenty of them school age. I have friends still in that building who have kids in the local schools.

I don't know how the math works out right now, but it gets worse every year for 35 years.

Posted on: 2013/11/15 18:43
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Re: 35-year tax break proposed for three-tower Journal Square project
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First, if other developers do not get the same length of abatements, then they would sue. Second, the development will not pay the abatement until they receive a C/O. That could be as much as 5 years after it is built while it is renting to tenants. Third, that development will hurt the property value of other condo owners. St. John's and Brunswick Towers which does not have an abatement and are paying close to $10,000 for 2 bedroom units. The equity in those condos have now been reduced. When the abatement kicks in, it will pay approximately $1,300. Why would anyone want to buy an older condo, that is blocks away and pay high taxes? This is economic discrimination.

Posted on: 2013/11/15 18:43
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Re: 35-year tax break proposed for three-tower Journal Square project
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Here's what I don't understand about the argument against abatements - as it stands, now, the property taxes that are collected on the lot are what they are - let's say just for example they're $10000/year. Once the building is finished and occupied, on top of this lot, the taxes collected will be significantly higher, since Jersey City bases them on not just the land but any "improvements". If the tower is 70 stories and again just for example each story has 2 condos, and each condo pays $1k/year taxes (on top of the shared $10k for the land), now the city is collecting $150k/year - or $140k/year more than they were before the project was started. How is this considered subsidizing the developer?

Are there studies that extrapolate the average cost, to the city, of the consumed city services (paid for through the taxes) that the new residents will incur? Does it take into account that, let's be real, most of the residents will not have children (or may only have toddlers, if so, and they're likely to move to the suburbs before their kids are school-age)?

I'm not trying to be argumentative, but rather, am trying to understand how this is, from a purely monetary perspective, anything but a benefit to the city...?

Posted on: 2013/11/15 18:33
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Re: 35-year tax break proposed for three-tower Journal Square project
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I can't say taht I disagree with Yun. But at least we are seeing abatements move from the waterfront and i hope that after jsq will not need abatements in 3-4 years.

Posted on: 2013/11/15 18:14
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Re: 35-year tax break proposed for three-tower Journal Square project
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Thought-provoking letter from Michael Yun in the JJ today:

http://www.nj.com/hudson/voices/index ... y_abate.html#incart_river

By MICHAEL YUN

Every new development casts a shadow over all of Jersey City, and not one is built in a vacuum. As elected officials, we should not and cannot refuse the responsibility of considering, in the broadest sense, how a new project will shape our city?s future.

Don?t get me wrong, I believe in development. I don?t believe in subsidizing developers that refuse to take the same risks that every new homeowner takes, refuse to make the same contributions to our schools and county that every resident makes, and create projects that further economically segregate our city. Displacing the blue-collar residents that built this city and replacing them with richer, less diverse residents is not a success story. But when we make sweetheart deals with developers that subsidize high-rent highrises with taxpayer dollars, that?s the story we end up with.

A disturbing argument I?ve heard is that abatements are just the way that things are done. This makes no sense to the general public. We have elections in order to set new precedents. My neighbors, my constituents, come to me and say, ?We don?t want the waterfront.? They want to live in their neighborhood, they need reasonable taxes so they can afford to, and they deserve a government that puts them first with a responsible tax policy. The ?Journal Square? project, unfortunately, is not going to serve Jersey City residents. This abatement subsidizes a 70-story, 1,840-unit high-rent bedroom community steps from the PATH train with taxpayer dollars, and then bonds $10 million to create the infrastructure improvements for that development.

Property taxes and the cost of municipal services will dramatically increase throughout Jersey City over the next 35 years ? and this developer will still be paying a fixed service charge. It?s tough to see where the benefit to residents comes in.

Phase I of this project has an average rental price of over $2,000/month, increasing to an average of $2,838/month in Phase III. Journal Square?s per capita income is $24,555. It?s not rocket science ? these are not prices that Jersey City residents can afford. Instead of putting in affordable housing units, this developer is making a contribution of less than 0.4% of the total construction costs to the affordable housing trust fund to build affordable housing elsewhere .

This developer will be making a profit of over $277 million on this project over the term of the abatement ? at least $11 million per year after expenses ? and they?re telling us that they can?t put 20 percent affordable housing on site out of fear that it will lower property values? They want to be rewarded with an abatement for directly making Journal Square unaffordable for most Jersey City residents? That is not contributing to the community ? that is displacing it.

The community, in this case, is substantial. Journal Square is a transit hub, with PATH trains to Newark, Downtown Jersey City, and New York, and seven bus companies with destinations all over the state. It is the physical center of the second-largest city in New Jersey, one of the densest areas of Jersey City, and home to at least 300 stores and over 8,000 linear feet of storefronts. The Journal Square PATH system at rush hour is already overloaded. Residents already pack rush hour NJ Transit buses in both directions. This project will put an enormous additional load on already overtaxed and aging infrastructure.

More importantly, continued reliance on bloated abatements sustains a system of economic segregation, where the wealthy live where they want to and the poor live where the wealthy don?t want to. If our elected officers, as leaders of the city, want to change our future as we promised, then it is our responsibility to build one Jersey City, together, instead of continuing the tale of two cities.

Michael Yun.JPG
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Michael Yun

EDITOR?S NOTE: Michael Yun is the Jersey City Ward D councilman and a Central Avenue businessman.

Posted on: 2013/11/15 17:05
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Re: 35-year tax break proposed for three-tower Journal Square project
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With the exception of Yun and Boggiano, everyone ran with Fulop. It appears important information was kept in the dark. The ordinance summary from the agenda only mentions the bond ordinance. It did not mention it was the abatement hearing.

Posted on: 2013/11/14 21:35
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Re: 35-year tax break proposed for three-tower Journal Square project
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Quote:

DanL wrote:
just my observations -

some of the council members thought they had only voted on the bond ordinance not the abatement. this was after all the public speakers, deputy mayor and the vote.

to be fair, once city staff started to explain the agreement, it became more confusing. the 3rd building is not targeted to be complete for 16 years (then the abatement begins?) so that would take agreement out almost 50 years? There clearly needs to be a "plain" language document, not just for the public, but for city staff and council members.

someone might have known exactly what was voted on last night, but they were not in the council chambers.


That seems like the fault of incompetent members of the City Council, not anyone else.

Posted on: 2013/11/14 20:50
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just my observations -

some of the council members thought they had only voted on the bond ordinance not the abatement. this was after all the public speakers, deputy mayor and the vote.

to be fair, once city staff started to explain the agreement, it became more confusing. the 3rd building is not targeted to be complete for 16 years (then the abatement begins?) so that would take agreement out almost 50 years? There clearly needs to be a "plain" language document, not just for the public, but for city staff and council members.

someone might have known exactly what was voted on last night, but they were not in the council chambers.

Posted on: 2013/11/14 14:57
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Re: 35-year tax break proposed for three-tower Journal Square project
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I wish I had attended the meeting. I would've gone with a large poster-sized graph of how taxes have increased substantially and routinely ever since Jersey City started giving out these massive tax breaks.

Posted on: 2013/11/14 7:07
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Re: 35-year tax break proposed for three-tower Journal Square project
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"?They?ll go to where the incentives exist and where the best opportunities are to make money,? said Thieroff, who added that ?nothing has been built of any significance in the square for 30 years.?"

Apparently Thieroff hasn't stepped foot in Journal Square in the last 10 years. STATE SQUARE was built (with a long-term tax break) by the Applied Cos in 2004. 19Rock is under construction. 25 Senate Place is under construction. CanCo Lofts is mostly finished. These are ALL large-scale projects, and they've all been built in the last 10 years. JSQ doesn't need handouts like this.

It's no coincidence that Jersey City, which has handed out more tax breaks than any other municipality in Hudson County, has the highest property taxes in Hudson County. It doesn't take a rocket scientist to figure out that these tax breaks are at the root of the problem.

Posted on: 2013/11/14 7:03
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http://www.nj.com/hudson/index.ssf/20 ... html#incart_river_default
When this outburst happened, the cops only target one person, Riaz, an activist who attends council meetings. Riaz was carrying a sign with Fulop's face and words. The cops told him to leave and never attend another council meeting.
Is this a Communist State? What happened to the first amendment? Everyone reacted why wasn't they asked to leave?

Posted on: 2013/11/14 4:31
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Re: 35-year tax break proposed for three-tower Journal Square project
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John/T-Bird and others -

Is this a better deal for the city than the prior Harwood/MEPT/Hotel on the Square/City Center tax abatement agreement?

How does the cost of services for the new residents and businesses from the city and schools compare to the pilot revenue?

Posted on: 2013/11/12 2:26
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Ok, so if the project is completed sometime between now and five years from now, the building gets a 30-year tax abatement. For every year beyond five years from now that the project isn't completed, the abatement period is reduced by one year.

Of course, if the project isn't completed in 5 years, KRE Group will plead "unforseen financial hardship" and the whole deal will be reset so that they get the same sweet deal.

Posted on: 2013/11/7 2:49
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Jersey City says I'm wrong about the 35 years, and here's why: the abatement does refer to "35 years from date of adoption," but the city says that's to put a five year time limit on substantial completion. If project isn't complete for 10 years, they say, then abatement would end 35 years from now -- but the abatement itself would only be 25 years.

Posted on: 2013/11/6 18:58
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Re: 35-year tax break proposed for three-tower Journal Square project
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Cities, especially JC should not be on the hook to subsidized developers. I recently checked our bond rating. It is A2 or A, the third lowest which comes after AAA and AA. We have tons of debt and there are no guarantees. 20 plus years ago, taxpayers paid $20 to $25 million in debt service, now we are paying close to $60 million.
The project is too dense, there will be hundreds of new people all trying to get on the PATH train at rush hour.

Posted on: 2013/11/6 14:48
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Re: 35-year tax break proposed for three-tower Journal Square project
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The abatement is for 35 years from adoption or 30 years from substantial completion. So, likely 30 years, yes, but if the first tower isn't built on schedule or the project stalls, it could be 35.

Posted on: 2013/11/6 14:04
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Quote:
DanL wrote: "D?j? vu all over again" The $600 million, three-tower residential project that Jersey City believes will transform Journal Square is set to receive a 35-year tax break, in addition to $10 million in bonds issued by a city agency that will pay for infrastructure improvements in the area. [!IFRAME FILTERED! ]

Speak NJ : Dan Levin at Journal Square Tax Abatement Hearing from Dan Levin for Council on Vimeo.

2009 Dan pretty much addresses 2013 Dan's comment when he says it's amazing that a project like this needs such generous tax breaks to get built (words to that effect) - even with the abatement that was granted, the project wasn't economically viable and was never built. The abatement is 30 years, not 35. Repeating the original error won't make it true. Neither the city nor any agency of the city is incurring $10 million (or $30 million) of debt, nor will the city (or any agency) be on the hook for $10 million under any practical scenario.

Posted on: 2013/11/6 13:55
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If you are about the truth, then tell the truth, don't spin it and don't connect the dots where there is no connection. You keep trying to make the connection, and your basis is a falsehood 100% of the time.

Posted on: 2013/11/6 13:25
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First, I am not against Fulop but I am for the truth. Fulop was an excellent councilman but I am talking about the present. Kushner and his family has been involved in real estate and have been supporting politicians for years. I was aware of Kushner before Fulop became involved in politics. I am concerned about this development with not enough parking spaces and the fact taxpayers are on the hook in terms of bonding. The city's bonding rate is not that great. Most likely this development will get this abatement, then they will sell it for a large sum down the road and the abatement will be transferred. We are doing everything to protect developers and that I believe is wrong.

Posted on: 2013/11/6 1:33
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Re: 35-year tax break proposed for three-tower Journal Square project
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Is the Star Ledger owned by Kushner as we'll? They wrote an article about Fulop that was every bit as favorable. It seems that your Anti Fulop position is driving this. You keep adding 2+2 and they come up 0. Do facts have anything to do with your positions? I can't see it from your posts.

Posted on: 2013/11/6 0:44
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Re: 35-year tax break proposed for three-tower Journal Square project
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You don't get it. NY_Observer Jared Kushner promoting Fulop and promoting the family business which will happen in Journal Square.

Posted on: 2013/11/5 23:20
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You just don't get it. THEY HAVE NO BUSINESS RELATIONSHIP. They are no longer partners, the companies are different. Why do you insist on connecting them, when they are not connected? Are you more capable than the Attorney General or the FBI. I really question your motives, and other posts you state as "fact".

Posted on: 2013/11/5 22:48
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Re: 35-year tax break proposed for three-tower Journal Square project
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http://www.multifamilyexecutive.com/m ... race-charles-kushner.aspx

Read the Line that say, He is in jail and no longer leading his company.

http://gawker.com/550119/charles-kushner

Also his connection to McGreevey, another person on our payroll.

It is not wonder people here use phony names, I would be embarrass also if I ignored the facts.

Posted on: 2013/11/5 22:29
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Re: 35-year tax break proposed for three-tower Journal Square project
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Quote:

Yvonne wrote:
Charlie Kushner went to jail. People who are felons have problems getting mortgage money. So the business is in the family. Charlie Kushne's son, Jared, gave Fulop a front page story in his New York Observer.


There you go again. Forget to take your pills this week?
Here, read this and recheck your spin.
http://nymag.com/news/features/57891/index2.html

Posted on: 2013/11/5 22:05
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Re: 35-year tax break proposed for three-tower Journal Square project
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Charlie Kushner went to jail. People who are felons have problems getting mortgage money. So the business is in the family. Charlie Kushne's son, Jared, gave Fulop a front page story in his New York Observer.

Posted on: 2013/11/5 21:40
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"D?j? vu all over again" The $600 million, three-tower residential project that Jersey City believes will transform Journal Square is set to receive a 35-year tax break, in addition to $10 million in bonds issued by a city agency that will pay for infrastructure improvements in the area. [!IFRAME FILTERED! ]

Speak NJ : Dan Levin at Journal Square Tax Abatement Hearing from Dan Levin for Council on Vimeo.

Quote:
hilltopgirl wrote: Here are the details on the tax abatement petitioned by the J2 developers (source below): "PROPOSED ABATEMENT: Phase I (54-story, 540-unit tower) "The applicant has requested a term of thirty (30) years for the abatement on the improvements. The Applicant has submitted a schedule of payments to be known as the Base Service Charge. The Base Service Charge is determined upon a fixed per unit service charge beginning at $500 per residential unit in years one (1) and two- (2) and increasing in steps to $2,300 per unit in year twenty-six (26). ? "The Minimum Service Charge for phase I is $119,334 which includes the land tax of $96,751.89. Service charges for commercial, miscellaneous or parking revenue are included in the Base Service Charge. "The Applicant will make a nonrefundable upfront payment of $1,797,000 within five (5) business days of substantial completion as defined in the Financial Agreement. Using a factor of seven percent (7%) the present value of that upfront payment would effectively increase the Base Service charge to $1,200 per unit in years one (1) though five (5) and to $1,248 in years six (6) though ten(10). ? The applicant has requested a credit for the land taxes entire project against the PILOT for Phase I for the first five (5) years only. That amount would be $329,661.23. The applicant would also pay a Service Charge five percent to Hudson County and an administrative fee one half of one percent (0.05%) to the City. "PROPOSED ABATEMENT: Phase II (the 70-story, 700-unit tower) "The applicant has requested a term of thirty (30) years for the abatement. The Applicant has submitted a schedule of payments to be known as the Base Annual Service Charge. The Base Annual Service Charge is determined upon a fixed per unit service charge beginning at $787.00 per residential unit in years one (1) through ten (10). lt increases to $1,000.00 for years eleven (11) through fifteen (15) and increases to $2,300.00 per unit in year sixteen (16). The Minimum Service Charge for phase ll is $132,593.73 which includes the land tax of $125,413.87. Service charges for commercial, miscellaneous or parking revenue are included in the Base Service Charge. The Applicant will make a nonrefundable upfront payment of $2,843,261 within five (5) business days of substantial completion as defined in the Financial Agreement. The final five (5) years under either plan would be at ten percent (10%) of gross revenue. No adjustment has been made for vacancies in these calculations. PROPOSED ABATEMENT:Abatement for Phase III (60-story, 600 unit tower) "The applicant has requested a term of thirty (30) years for the abatement. The Applicant has submitted a schedule of payments to be known as the Base Annual Service Charge. The Base Annual Service Charge is determined upon a fixed per unit service charge beginning at $1,111.00 per residential unit in years one (1) through ten (10). It increases to $2,500.00 for years eleven (11) through twenty- five (25). The Minimum Service Charge for phase III is $154,692.68 which includes land tax of $107,465.47. Service charges for commercial, miscellaneous or parking revenue are included in the Base Service Charge. The Applicant will make a nonrefundable upfront payment of $2,942,766.00 within five (5) business days of substantial completion as defined in the Financial Agreement. The final five (5) years under either plan would be at ten percent (10%) of gross revenue. No adjustment has been made for vacancies in these calculations. While it is true the city will be collecting more than it currently does from those parking lots where the towers will be, to have some of these units start at $500 in annual taxes is fundamentally a slap in the face to those of us who pay about that amount per month. I'm all for the much needed improvements and do understand the strategic use of abatements to attract development; what I don't support is the outrageous inequality this creates. http://www.cityofjerseycity.com/uploa ... Reading/Agenda%20Document(17).pdf

Posted on: 2013/11/5 21:08
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Here are the details on the tax abatement petitioned by the J2 developers (source below):


"PROPOSED ABATEMENT: Phase I (54-story, 540-unit tower)

"The applicant has requested a term of thirty (30) years for the abatement on the improvements. The Applicant has submitted a schedule of payments to be known as the Base Service Charge. The Base Service Charge is determined upon a fixed per unit service charge beginning at $500 per residential unit in years one (1) and two- (2) and increasing in steps to $2,300 per unit in year twenty-six (26). ?

"The Minimum Service Charge for phase I is $119,334 which includes the land tax of $96,751.89. Service charges for commercial, miscellaneous or parking revenue are included in the Base Service Charge.
"The Applicant will make a nonrefundable upfront payment of $1,797,000 within five (5) business days of substantial completion as defined in the Financial Agreement. Using a factor of seven percent (7%) the present value of that upfront
payment would effectively increase the Base Service charge to $1,200 per unit in years one (1) though five (5) and to $1,248 in years six (6) though ten(10). ?
The applicant has requested a credit for the land taxes entire project against the PILOT for Phase I for the first five (5) years only. That amount would be $329,661.23. The applicant would also pay a Service Charge five percent to Hudson County and an administrative fee one half of one percent (0.05%) to the City.



"PROPOSED ABATEMENT: Phase II (the 70-story, 700-unit tower)

"The applicant has requested a term of thirty (30) years for the abatement. The Applicant has submitted a schedule of payments to be known as the Base Annual Service Charge. The Base Annual Service Charge is determined upon a fixed per unit service charge beginning at $787.00 per residential unit in years one (1) through ten (10). lt increases to $1,000.00 for years eleven (11) through fifteen (15) and increases to $2,300.00 per unit in year sixteen (16). The Minimum Service Charge for phase ll is $132,593.73 which includes the land tax of $125,413.87. Service charges for commercial, miscellaneous or parking revenue are included in the Base Service Charge. The Applicant will make a nonrefundable upfront payment of $2,843,261 within five (5) business days of substantial completion as defined in the Financial Agreement. The final five (5) years under either plan would be at ten percent (10%) of gross revenue. No
adjustment has been made for vacancies in these calculations.


PROPOSED ABATEMENT:Abatement for Phase III (60-story, 600 unit tower)

"The applicant has requested a term of thirty (30) years for the abatement. The Applicant has submitted a schedule of payments to be known as the Base Annual Service Charge. The Base Annual Service Charge is determined upon a fixed per unit service charge beginning at $1,111.00 per residential unit in years one (1) through ten (10). It increases to $2,500.00 for years eleven (11) through twenty- five (25). The Minimum Service Charge for phase III is $154,692.68 which includes land tax of $107,465.47. Service charges for commercial, miscellaneous or parking revenue are included in the Base Service Charge. The Applicant will make a nonrefundable upfront payment of $2,942,766.00 within five (5) business days of substantial completion as defined in the Financial Agreement. The final five (5) years under either plan would be at ten percent (10%) of gross revenue. No
adjustment has been made for vacancies in these calculations.

While it is true the city will be collecting more than it currently does from those parking lots where the towers will be, to have some of these units start at $500 in annual taxes is fundamentally a slap in the face to those of us who pay about that amount per month. I'm all for the much needed improvements and do understand the strategic use of abatements to attract development; what I don't support is the outrageous inequality this creates.


http://www.cityofjerseycity.com/uploa ... Reading/Agenda%20Document(17).pdf

Posted on: 2013/10/29 17:19
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Re: 35-year tax break proposed for three-tower Journal Square project
#91
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Not to mention that she was already corrected on the proper use of Roman numerals in another thread, but she insists on using sequences of "1" in their place. The kicker is that, in the same thread, she quoted an article that clearly shows she was in error.

People like Yvonne would be better served by dialing back their vitriol and actually listening, even if briefly, to what others have to say. Their myopic approach turns people off, and results in their message being tuned out.

Posted on: 2013/10/28 15:35
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Re: 35-year tax break proposed for three-tower Journal Square project
#90
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Quote:

La_Verdad wrote:

Yvonne wrote:

KRE is Kushner. But not that Kushner. You are thinking of Charlie Kushner, the McGreevy financial backer. KRE is Murray Kushner. Their business interests are entirely separate.



You are correct. She was told this over a month ago, http://jclist.com/modules/newbb/viewtopic.php?topic_id=29741, (see posts 128, 131,133 and 137) the truth obviously does not suit her needs. John1952 should weigh in soon on this as well

Posted on: 2013/10/28 15:03
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