glx wrote:
Quote:

If you really believe this is not some form of subsidy, then why are all the developers asking for them in the first place? Why would they want something that didn't benefit them in some way?

The fact is that people with PILOTs do not pay the same rate of taxes that those without them do. I'm fairly sure the amount an owner with a PILOT pays is roughly 20% less than an owner without a PILOT pays.

Yes, you are correct that the city gets more money. This is simply due to the fact that they don't have to share income from PILOTs with the other entities. But our property tax bills (those of us who don't have PILOTs) aren't just a city thing. We have to pay those other portions. And, we have to make up for the portion that those with PILOTs don't pay. That alone is a subsidy.

Don't think for a minute that those who live in buildings with PILOTs aren't affected by the school systems or what happens in county government. That's a fallacy. Even if you don't have children or send your children to private schools, we are all affected by the state of our public school system.

My God...as a society, we have become such narcisists.

Here's my two cents on the whole situation:

You might think that the PAD is a stupid idea.

You might think that the buildings in the area are ugly and not worth saving.

You might think that a building designed by David Childs sounds really great.

You might think that tall buildings are no big deal since the district is already surrounded by them.

You might think that the city is going to ultimately financially gain from this decision.

And...on many levels you might very well be right.

But that's not the issue here. The problem is that the city has zoning ordinances and in this particular case the city council reaffirmed those ordinances on more than one occasion.

Now a deep pocketed developer has decided that he doesn't really like those ordinances, because they don't serve his needs so he threatens to sue. Since he has an abundance of money, he makes it clear that he is going to make the city pay.

So the city buckles under and kisses his a**.

Why is that a problem? Because it sets a precedence and it sends a message to the rest of the developers that whenever they don't like a city law, all they have to do is threaten to sue.

It's a good thing that all of these developers want to build in our city. It is not good, however, that they be left to their own devices. They ultimately don't care about the overall city. They care about making a profit.

One of the functions of government (in my opinion) is to oversee the planning of the city. How can they do that when it's anything and everything the developers want?

Folks, this may very well come back to haunt all of us. Who knows when it will make it's way into our neighborhoods? It may not affect you directly today, but it could in the future - especially if our elected officials keep giving away the store.

Sometimes one has to look at the larger picture and not go for the immediate gradification. Our city leaders need to remember this most of all.

Chartman,

The HPHA (Historic Paulus Hook Association) meeting is tonight at 7:30 PM in the OLC basement on Sussex Street. I have no idea who you are, but hopefully you attend these meetings. If not, you should.

The HPHA has several committees including Development Oversight and Construction that can get involved in things like this.

It is something that the general membership needs to make known that they feel is a priority. Come to the meeting and speak up.

The government seems to listen when they think they have a group of concerned citizens versus one or two complainers (which is what we can easily be labeled as when we are not organized).

See you there...I hope.

My favorite part of the article was Healy's quote at the end (and yes, that's sarcasm):

"These developers would not come and build here without these abatements, and they have helped make the city successful..."

What bothers me about this statement is that it is out of date. Had this statement been made 10 years ago (and maybe even as little as 5 years ago), it would have been spot on. But things have changed. Today, that statement couldn't be farther from the truth.

We've already passed that moment in time when the city needs to entice development here (at least in downtown and along the waterfront). Developers are now interested because they see dollar signs; not maybe I'll take a risk and it will pay off , but let's get in while the gettin' is good dollar signs.

I do not believe that Donald Trump is a pioneer. He's more of an opportunist, and it's worked well for him. KHov is not taking on their very first condominium tower in their history because they hope and pray that it's going to pay off. Field's Brothers and Metro Homes are picking up site after site because they think that they could possibly be on to something. Lefrak isn't expanding Newport based upon spectulation, they know from 20 odd years of experience exactly what to expect.

So I have to whole heartedly disagree with Mr. Healy. If the city stopped handing out PILOTs to large developers building on prime land in downtown Jersey City, those developers wouldn't suddenly go away. They may threaten to, but in the end I think we would all find that these threats are empty. But of course they are working now.

Here is the conundrum for me. Does Healy really believe what he is saying or is it just the convenient answer to rationalize his change of heart? When he campaigned, he certainly sang a different song. Is he simply making excuses or has he discovered that truly governing is hard and often requires unpopular decisions so succumbing to PILOTs is simply the easiest way out? Either way, it doesn't say much for him as an affective mayor as he's either out of touch or he's simply a poor leader.

Listen, I love the fact that Jersey City is rising. I love the fact that I have gotten in on something that is both exciting and fascinating. What I don't love, however is that the city seems to simply be deferring many of it's responsiblities and rights over to people (and companies) simply because they are willing to build more ratables. As I've said a number of times on this site alone, it's short term thinking that is going to cost everyone in the end. There is a price to be paid for all of this and the tax increases (on all three levels) that we have experienced this year are just the beginning.

Let me make a suggestion here. The chances of winning the "tax abatement" argument is slim to none as long as you continue to spout untruths. It is a fundamental mistake to suggest that PILOTs (which are not the same as tax abatements by the way) are the reason that the city has less revenue coming in. This is completely false.

The reason the PILOTs (Payment in Liu of Taxes) that are given to all of the new huge developers are so attractive to our politicians is that they bring more money into the city than conventional taxes do. The city keeps handing them out because they are a quick fix. They allow our mayor and our council people to keep cash coming in without making the hard choices.

As I've posted in two other places on this site, let's talk about PILOTs and abatements 101.

The "normal" property taxes we pay are divided three ways. The city gets the largest portion of the tax bill and the rest is divided up between the local school system and Hudson County. The city, however, can give people property tax breaks; and they can do this in one of two ways.

The first way is by granting a tax abatement. A tax abatement is a discount (usually 30%) given to people who make significant improvements to existing property or to small scale new construction. Abatements are a tool to encourage "the little guy" to improve their property, thus improving the overall area where that property is located. Tax abatements are generally for a term of 5 years and the moneys collected are divided amongst the three entities using the same percentages that are used for all property taxes in Jersey City.

The other way that the city can give a tax break is through a PILOT program. PILOTs are not taxes, however. They are Payments in Liu of Taxes.

PILOTs are handed out to large developers (such as Trump) within a redevelopment zone. Because they are not technically taxes, they do not have to be divided up between the city, the schools and the county. The city of Jersey City gets essentially all of the monies collected from PILOTs. So since the city is not having to "share" the money, even though the rate is substantially lower than the standard property tax rate, the city ends up with more money in the end. Let me put it another way. All of these people with PILOTs are getting a better tax rate (probably 20 to 30% less than most everyone else), but the city is getting to collect that entire amount of money which comes out to being more than what they get from the average tax payer because they don't have to share this revenue with the county or the schools.

Now in case it seems as if I'm all for PILOTs, I'm not; at least not in areas where there is no need to entice people to build. That is the intended use of PILOTs, but as we all know, that's not how they are being used by our politicians. What I've come to understand is that although the city is getting more money at the moment, we're all going to get screwed in the end because the county and the schools are going to have to raise their rates as there are too many people who are not paying into that portion of the system.

So I agree; our mayor and council people need to get some help with their addiction to PILOTs and begin to lead and make some hard choices. We cannot continue to live on borrowed money any longer. Doing so means that we are essentially living on borrowed time. It's all going to catch up to us as some point. It always does.

So please consider all of this when you are arguing that "tax abatements" are the reason for our financial woes. At the moment they are not. And when we all use these arguments, our representatives can simply brush us aside because it's obvious, at least in their rationale, that we have no idea what we are talking about and that they know what's best.

And one last thing, take a look at who votes for and against these PILOTs on a regular basis, and listen to the reasons that they vote the way that they do. Don't simply lump everyone together. It's laziness on our part to make broad statements that everyone is the same. When we do that, we are basically taking the easy way out. Doing so, in the end, is just as bad as what the people we want to throw out are doing. Really, it's essentially the same thing.

I posted this on another thread, but it seems this is the one that's getting traction.

So I am posting it again...



Well folks...it's time to pay the piper; and this is just the beginning I suspect.

As I've been saying, over and over again, to anyone who knows me and will listen, the state of New Jersey is not going to continue to pay for nearly all of the costs of running Jersey City schools forever.

Now that we have reached the point where Goldman Sachs, Donald Trump, The Athena Group and the rest of the big name developers who are likely lining up to build large scale projects in Jersey City have come to town, it is only logical that those people who do not live in Jersey City will start questioning why they are spending their tax dollars to pay for schools that are no where near their homes. When this occurs, it will be the property owners in Jersey City who will be left to pick up the tab. Unfortunately, the people who are living in the developments that will likely tip the scale towards lower school funding by the State of New Jersey won't have to foot the bill.

Yes...this is going to be an all out rant against PILOTs. As the city government is handing out PILOTs to large developers like candy, the state is getting itchy about having to overwhelmingly support the school system in Jersey City. Now I understand that what is occurring now is not the revolt I am talking about. I realize they are not cutting funding as much as they are freezing it, but I would wager anything that this is simply the firing of the first shot.

From this point on, every time the state gets into financial troubles, it is going to look mighty attractive to let the property owners of Jersey City foot more and more of their own school cost. And mark my words, eventually those people who don't live anywhere even close to Jersey City are eventually going to force the state legislative body to reconsider funding schools in a city that is known as the Gold Coast.

The thing is, we cannot blame those on the state level. Ultimately, we have only ourselves to blame. It is us who continues to elect council members who repeatedly vote to hand out PILOTs to large developers on or near the waterfront. It is our own city government who is selling us down the river.

One of the problems is that I believe most people do not truly understand the issue. First of all, I'm not sure that many of us even know there is a difference between and "abatement" and a PILOT program. For this reason, let me explain to the best of my knowledge.

The "normal" property taxes we pay are divided three ways. I will admit that I do not know the percentages off hand, but I do know that the city gets the largest portion of the tax bill and the rest is divided up between the local school system and Hudson County.

Now the city, by law, can give people property tax breaks; and they can do this in one of two ways. The first way is by granting a tax abatement. A tax abatement is a discount (usually 30%) given to people who make significant improvements to their property or to small scale new construction. Abatements are a tool to encourage "the little guy" to improve their property, thus improving the overall area where that property is located. Tax abatements are generally for a term of 5 years and the moneys collected are divided amongst the three entities using the same percentages that are used for all property taxes in Jersey City. Just as a point of full disclosure, my condo unit has a 5 year abatement.

The other way that the city can give a tax break is through a PILOT program. PILOTs are not taxes, however. They are Payments In Liu of Taxes.

PILOTs are handed out to large developers (such as Trump) within a redevelopment zone. Because they are not technically taxes, they do not have to be divided up between the city, the schools and the county. The city of Jersey City gets essentially all of the monies collected from PILOTs. So since the city is not having to "share" the money, even though the rate is substantially lower than the standard property tax rate, the city ends up with more money in the end.

When looked at this way, it is very easy to see why the City Council could become addicted to PILOTs. Essentially they are like crack cocaine. They are a quick fix. It's immediate gratification. Unfortunately, the whole thing is devoid of reality.

Since all of these new units coming on line have or will have PILOTs (and we are talking numbers in the thousands) they will not be participating in the property tax increases that will need to be implemented because Jersey City residents must now foot a larger portion of school costs. That burden is going to fall onto the rest of us.

Admittedly, I am benefiting from an abatement at the moment so I will get a small break in all of this, but my abatement will end in a couple of years. Those owners who live in a property with a PILOT get out of the burden for 20 years or more. Twenty years is a long time folks.

Now I?m not completely against PILOTs. The original purpose of them was as a tool for city governments to encourage redevelopment in blighted areas. Let?s face it; we still have many areas of the city that fall in that category. So I wasn?t particularly upset when The Beacon got a PILOT. I will fully support the developers of the new project in Journal Square when and if they ask for one. I think they should be used to encourage redevelopment around Jersey City University and in the entire Greenville section of the city. I cannot, however, support any more of these things being giving out anywhere in downtown or even on the ?west coast? of the city. These areas are already attractive to development and the big name developers who have the resources to take these sights on. They don?t need incentives. They?re building now simply because they think they can make money.

The time has come for all of us to wake up and begin demanding that our council members stop taking the easy way out thus mortgaging our (as well as our children and grandchildren's) futures because it is easier to hand out a PILOT than it is to do the hard work of living within our means. Those people who can afford to pay half a million dollars or more for a condo unit need to be participating in all forms of the tax burdens just like everyone else. As it stands now, and with the majority of the City Council members thinking that there is no need to stop their habit, the average tax payer in Jersey City is going to get really screwed.

What we need is an intervention and we need it quickly. The piper is going to want far more in payment then what's being demanded at the moment. That's a guarantee.

Here is an article from today's Jersey Journal:


Jersey City told it has school aid hole to fill
Friday, March 24, 2006
By KEN THORBOURNE
JOURNAL STAFF WRITER

Already staring at a triple-digit tax whack to make ends meet in their municipal budget, Jersey City taxpayers are now facing an additional $7.5 million tax hit to pay for schools.

In a follow-up to Gov. Jon Corzine's bad news budget presentation Tuesday, state officials announced yesterday that aid to most school districts in the state would remain flat.

But in eight of the state's 31 neediest districts, including Jersey City, local taxpayers would have to foot more of the bill, state officials said.

"We didn't want to have a huge detrimental impact here, but we wanted to recognize that some of these communities can supply a greater share of their school funding locally," acting State Commissioner of Education Lucille Davy said during a conference call with reporters.

"Many of them (the eight municipalities) have not raised their (school) tax rate for the last several years. Those communities can begin to pay."

State officials said they determined which municipalities had to pay more based on the property values and the percentage of local tax money going to schools.

Jersey City raises $72 million a year - roughly 13 percent of the district's budget - and hasn't budged in 10 years, school officials said.

"We would have preferred not to have this kind of reduction," said Mayor Jerramiah Healy. "We'll have to find a way to meet this challenge."

Jersey City Superintendent of Schools Charles T. Epps Jr., who is also a state assemblyman, didn't return phone calls for comment.

The cuts in state school aid will translate into roughly a $125 tax hike for a Jersey City taxpayer whose property is assessed at $100,000, said city Business Administrator Brian O'Reilly.

The city budget, which has not been adopted, could add an additional $300 or more to that tax burden, city officials said.

A municipality can get out of making up for what is cut by the state if it can prove to the state that its students will still receive a "thorough and efficient" education - the legally mandated standard.

Jersey City received $430.4 million in state aid this school year and is slated to receive $422.8 next year.

The Newark school district suffered the biggest cut in sheer dollar amount ($8.2 million). But among the larger school districts, Jersey City received the biggest cut as a percentage of total state aid.

Funding remained flat for several Hudson County districts, including Bayonne, North Bergen, Weehawken, Secaucus and West New York.

Hoboken suffered a $231,000 cut.

The Union City school district received a $5 million boost in school aid.

But Anthony Dragona, the district's business manager, said that figure is misleading since the state cut this year's aid package by $3.8 million.

"I'm faced with a $4 million hole in my budget that I have two months to deal with," Dragona said.


? 2006 The Jersey Journal
? 2006 NJ.com All Rights Reserved.



Well folks...it's time to pay the piper; and this is just the beginning I suspect.

As I've been saying, over and over again, to anyone who knows me and will listen, the state of New Jersey is not going to continue to pay for nearly all of the costs of running Jersey City schools forever.

Now that we have reached the point where Goldman Sachs, Donald Trump, The Athena Group and the rest of the big name developers who are likely lining up to build large scale projects in Jersey City have come to town, it is only logical that those people who do not live in Jersey City will start questioning why they are spending their tax dollars to pay for schools that are no where near their homes. When this occurs, it will be the property owners in Jersey City who will be left to pick up the tab. Unfortunately, the people who are living in the developments that will likely tip the scale towards lower school funding by the State of New Jersey won't have to foot the bill.

Yes...this is going to be an all out rant against PILOTs. As the city government is handing out PILOTs to large developers like candy, the state is getting itchy about having to overwhelmingly support the school system in Jersey City. Now I understand that what is occurring now is not the revolt I am talking about. I realize they are not cutting funding as much as they are freezing it, but I would wager anything that this is simply the firing of the first shot.

From this point on, every time the state gets into financial troubles, it is going to look mighty attractive to let the property owners of Jersey City foot more and more of their own school cost. And mark my words, eventually those people who don't live anywhere even close to Jersey City are eventually going to force the state legislative body to reconsider funding schools in a city that is known as the Gold Coast.

The thing is, we cannot blame those on the state level. Ultimately, we have only ourselves to blame. It is us who continues to elect council members who repeatedly vote to hand out PILOTs to large developers on or near the waterfront. It is our own city government who is selling us down the river.

One of the problems is that I believe most people do not truly understand the issue. First of all, I'm not sure that many of us even know there is a difference between and "abatement" and a PILOT program. For this reason, let me explain to the best of my knowledge.

The "normal" property taxes we pay are divided three ways. I will admit that I do not know the percentages off hand, but I do know that the city gets the largest portion of the tax bill and the rest is divided up between the local school system and Hudson County.

Now the city, by law, can give people property tax breaks; and they can do this in one of two ways. The first way is by granting a tax abatement. A tax abatement is a discount (usually 30%) given to people who make significant improvements to their property or to small scale new construction. Abatements are a tool to encourage "the little guy" to improve their property, thus improving the overall area where that property is located. Tax abatements are generally for a term of 5 years and the moneys collected are divided amongst the three entities using the same percentages that are used for all property taxes in Jersey City. Just as a point of full disclosure, my condo unit has a 5 year abatement.

The other way that the city can give a tax break is through a PILOT program. PILOTs are not taxes, however. They are Payments In Liu of Taxes.

PILOTs are handed out to large developers (such as Trump) within a redevelopment zone. Because they are not technically taxes, they do not have to be divided up between the city, the schools and the county. The city of Jersey City gets essentially all of the monies collected from PILOTs. So since the city is not having to "share" the money, even though the rate is substantially lower than the standard property tax rate, the city ends up with more money in the end.

When looked at this way, it is very easy to see why the City Council could become addicted to PILOTs. Essentially they are like crack cocaine. They are a quick fix. It's immediate gratification. Unfortunately, the whole thing is devoid of reality.

Since all of these new units coming on line have or will have PILOTs (and we are talking numbers in the thousands) they will not be participating in the property tax increases that will need to be implemented because Jersey City residents must now foot a larger portion of school costs. That burden is going to fall onto the rest of us.

Admittedly, I am benefiting from an abatement at the moment so I will get a small break in all of this, but my abatement will end in a couple of years. Those owners who live in a property with a PILOT get out of the burden for 20 years or more. Twenty years is a long time folks.

Now I?m not completely against PILOTs. The original purpose of them was as a tool for city governments to encourage redevelopment in blighted areas. Let?s face it; we still have many areas of the city that fall in that category. So I wasn?t particularly upset when The Beacon got a PILOT. I will fully support the developers of the new project in Journal Square when and if they ask for one. I think they should be used to encourage redevelopment around Jersey City University and in the entire Greenville section of the city. I cannot, however, support any more of these things being giving out anywhere in downtown or even on the ?west coast? of the city. These areas are already attractive to development and the big name developers who have the resources to take these sights on. They don?t need incentives. They?re building now simply because they think they can make money.

The time has come for all of us to wake up and begin demanding that our council members stop taking the easy way out thus mortgaging our futures (as well as our children and grandchildren's) because it is easier to hand out a PILOT than it is to do the hard work of living within our means. Those people who can afford to pay half a million dollars or more for a condo unit need to be participating in all forms of the tax burdens just like everyone else. As it stands now, and with the majority of the City Council members thinking that there is no need to stop their habit, the average tax payer in Jersey City is going to get really screwed.

What we need is an intervention and we need it quickly. The piper is going to want far more in payment that what's being demanded at the moment. That's a guarantee.

Quote:

The publication is called "Discover Your Neighborhood - Downtown Jersey City Edition Winter 2006" and from the best I can tell, there is no online edition

Quote:

Let me quote a few passages:

"The Shore Club (580 Washington Blvd.), a luxury condominium crown atop the mostly-rental 600-acre Newport development, is a multi-staged project that has already drawn intense interest from potential buyers. Since opening its sales office in September, 211 of the 214 available units have already sold - many of them for more than half a million dollars. What's perhaps surprising is that LeFrak was able to move these high-priced condominiums without bothering to advertise them. The interest in Left Coast property is so heated that word-of-mouth and internet discussion groups are generally enough to fill waterfront towers with new tenants and owners."

Sounds like a marketing dream doesn't it? The area is so hot that no one needs to advertise.

About Trump Plaza Jersey City, Tris said, "Like most other waterfront towers, these will bear the hallmark of New York architectural style: slimness, verticality, plate glass frontage, hi-rise elegance, a certain corporate feel."

There's more.

"Exterior [Properties] has taken pains to give the residences at The Schroeder Lofts (234 Tenth Street) and eco-friendly design. Closer to the park, the nascent development at the old St. Francis Medical Center (25 McWillams) promises to bring a pedestrian-friendly strip of boutique retail to the historic neighborhood."

Never mind the fact that this "pedestrian-friendly strip of boutique retail' is one of the things that concerns the neighbors.

He trumpets how well the developers of The Grove Pointe worked with The Harsimus Cove Association to create a design that everyone was so please with. "It ended up being a great team effort."

Now this might be truer than I expect, but my limited experience with developers through my own involvement with my neighborhood association has taught me that the developers deal with the neighbors only because they have to. It's not a big happy party.

Finally, one of my favorites is, "Liberty Harbor North (333 Grand Street) is easily the most audacious project under development in Jersey City, and possibly one of the most remarkable in the entire country."

If I didn't know better, I would have thought Donald Trump uttered these words. But it's not his project, and I doubt he's touting anyone else's.

My point is that Tris always made himself out to be the artist who was above all this capitalistic hedonism. I don't particularly care if he chooses to write stuff like this. We all have to make ends meet. My point in taking the time to point all of this out is that we all need to not look to him, or anyone else for that matter, to be the voice of reason for the rest of us. We need to educate ourselves, get involved, and speak up.

That's all I'm saying...

Quote:

Tris is too busy writing big sloppy wet blow job pieces about all of the new development in downtown Jersey City. You can find his piece in the new free "Neighborhood Guide" found at various businesses throughout downtown.

If I sound sarcastic, it's because Tris as always portrayed himself to be on the sceptical side of happenings in Jersey City; the voice of reason if you wish to call it that.

In the piece that I am referring to, however, it seems that he very well might have simply gotten "blurbs" from the various sales and marketing departments of the developers and simply tied them together. Don't get me wrong, as a property owner in Jersey City, I'm pretty excited about the renaissance of our fair city, but after reading his article, I could only imagine the developers finding themselves leaning back, wiping themselves off and needing a cigarette.

Quote:

There is a difference between sorbet and sherbert, beyond regional colloquialisms.

Sherbert contains milk where sorbet does not. So if the product has milk in it, it cannot officially be considered a sorbet.

Just an interesting tidbit.