December 4, 2002 From: "*Dan Tumpson*" [Symbitar@aol.com]
To: "*Dan Tumpson*"
Subject: Come to Council Meeting, 12-04-02 at 7PM, to Protest Expansion of PA Project {2}
Date: Tuesday, December 03, 2002 3:35 PMFellow Hoboken Citizens:
Please come to the City Council Meeting this Wednesday, December 4, 2002, to protest the amendment of the Port Authority (PA) Redevelopment Ordinance and Plan to allow an additional 650,000 sq.ft. of development to be built on Block B of the PA Project, located on the waterfront between 2nd and 3rd Streets in Hoboken.
The Roberts Administration are pretending that they are reducing the size of the PA project by 300,000 sq.ft. when actually they are increasing it by about 95,000 sq.ft.
In a letter to the Hoboken Reporter (November 24, 2002, reproduced below), I calculated that the fully built PA project will add approximately 14% to Hoboken property taxes because the PA project is exempt from property tax and pays Payments in Lieu of Taxes (PILOTs) which are only 20% of what the project should pay if it were fully taxed like the rest of us. The proposed 650,000 sq.ft. build on Block B is over 28% of the full build and so will itself add about 4% to your tax bill. This is not to mention the additional costs of large scale development, including increased stress on infrastructure (sewers, water supply, roads) and increased traffic. These costs are not only additional taxes, but a lower quality of life.
None of this will come as a surprise to the many of you who were around in 1990 and 1992 when a majority of the citizens of Hoboken voted against the PA Project in two referendum votes. Instead of heeding the will of the majority and using the City-owned southern waterfront property for public purposes, such as public parks, local politicians convinced the New Jersey Legislature in 1992 to change the state redevelopment law (which governs the PA Project) so that no the citizens would never again be able to have a referendum vote on a redevelopment project. Then, in 1995, then Mayor Anthony Russo and a City Council including current Mayor David Roberts and current Councilpersons Castellano, Del Baccio, Andruela, and Cricco passed the PA project, knowing that they were overturning the will of the voting majority and selling us out.
David Roberts ran for Mayor in 2001 on a platform of putting the brakes on development. Instead, we see major projects continuing to be approved by the Zoning and Planning Boards, even though they demonstrably harm the public, and we see the Mayor and Council pushing forward on creating a new Redevelopment Project on the Maxwell House site, so that another huge (1,400,000 sq.ft.) project will be removed from the Zoning Process and exempted from taxes, further diminishing our quality of life and further increasing our taxes.
At the November 20, 2002 City Council meeting, a huge public turnout forced the City Council to table the Redevelopment Ordinance Amendment. Last night the Council staged a "workshop" to convince the public that they were benefiting Hoboken with their 650,000 sq.ft. of development, but again the public was not buying their bogus testimony and adamantly opposed to the redevelopment amendments.
Tomorrow evening the Amendment is again up for final passage, and NO PUBLIC HEARING is planned, despite the fact that the protests of many forced the issue to be tabled at the last meeting.
We ask you to come to the meeting at City Hall tomorrow, Wednesday, December 4, 2002, at 7PM and to bring all your friends and family, and to loudly and vocally protest this abuse of the public. It is not too late to stop the last block of our southern waterfront from being filled in with ruinous development -- let the Council know that you want this overdevelopment stopped, and that you want them to represent YOU for a change, and not the developers who are wrecking Hoboken!
*** PLEASE EMAIL THIS TO EVERYONE YOU KNOW ***
Thanks for your kind attention.
Sincerely,
Dan Tumpson
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TITLE: Port Authority Redevelopment PILOT Ripoff Adds 14.1% to Hoboken Taxes
Citizens of Hoboken:
The Roberts Administration recently started a process to designate the Maxwell House site on Hoboken's northern waterfront a "redevelopment zone" as governed by the NJ Redevelopment Law (NJSA 40A:12A-1 et seq.). This law is intended to encourage the redevelopment of "blighted" property by exempting it from property taxes and substituting substantially smaller Payments in Lieu of Tax (PILOTs) made to the municipality.
According to the Hoboken Reporter (10-13-02), "Roberts said that by creating PILOT agreements, the municipality gets a bigger piece of the tax pie and that will benefit Hoboken residents and create an incentive to bring major developers to the city. 'There is no question that the way to proceed in the future is with PILOTs,' said Roberts...' ".
There are two problems with this rosy picture:
(1.) A redevelopment project is exempt from the Zoning Law. Instead, developers and city officials negotiate the redevelopment zoning behind closed doors, with no public participation or scrutiny. Redevelopment projects which cause harm to the public, through loss of open space, giveaway of public lands, huge buildings, stress on infrastructure (sewer, water, parking, roads), environmental pollution, and extra traffic, escape the zoning process. These projects degrade our environment and lower our quality of life for the benefit of a few developers, and we have no say in the matter.
(2.) The redevelopment designation has been applied to Hoboken's most valuable property, waterfront property, violating the intent of state law and transferring the taxes of redevelopment property owners onto the backs of the other taxpayers.
Ordinarily, property owners pay municipal, county, and school tax. In contrast, redevelopment property owners are exempt from these taxes for up to 25 years, paying only PILOTs to the municipal government. To understand how redevelopment/PILOTs affects Hoboken property taxes, consider one redevelopment project, the Port Authority (PA) project on Hoboken's southern waterfront.
At full build, the PA project will consist of 2.315 million sq.ft., valued at about $300/sq.ft. (This estimate is based on a 1000 sq.ft. condo costing $300,000.) If the PA project paid full taxes at the current rate of 3.26%, its property tax would come to $9.78/sq.ft. Instead, the PA project pays PILOTs of only $2/sq.ft, only 20.5% as much tax as the rest of us!
At full build, the PA project will be annually exempt from $22,641,000 in property taxes, of which Hoboken taxpayers must pay the municipal and school taxes (60.86% or $13,779,000) and Hudson County taxpayers must pay the county taxes (39.14% or $8,862,000). Hoboken pays 14.96%, or $1,326,000, of these county taxes, so Hoboken taxpayers must bear $15,105,000 of the PA project's tax exemption. The $4,630,000 in PA project PILOTs offset Hoboken's share of the exemption, so the PA project increases Hoboken property taxes by $10,475,000.
This increase amounts to 0.46% of Hoboken's total property value of $2.279 billion, or 14.11% of your total property taxes. That's right! Your property tax would go down by 14.11% if the PA Project paid its fair share of taxes! If you own a $200,000 condo, $920 of your taxes goes directly to paying PA project taxes!
Now Mayor Roberts wants to turn the Maxwell House site, another prime waterfront property, into a redevelopment zone. If the 1.4 million sq.ft. Maxwell House project currently before the Planning Board were given the same PILOT deal as the PA project, it will underpay its taxes by $10,892,000, adding 8.53% to your property tax bill!
This scam is attractive to city officials because they can arrange PILOT payments to initially exceed full municipal taxation, bringing more money into city coffers without increasing the municipal tax levy, so it seems that municipal taxes are "stabilized" and the tax "problem" is with rising school and county taxes. But in truth much of this "problem" stems from transferring most of the redevelopment tax obligations onto the backs of the rest of the taxpayers.
Instead of promoting this redevelopment/PILOT scam, the Mayor and Council should immediately shut down all redevelopment projects, including the Northwest Redevelopment (which is still largely unbuilt), the expansion of the PA project, and the Maxwell House redevelopment designation (both of which are now before the City Council). These projects not only undermine the zoning law and our quality of life, they are ripping us off!
Sincerely,
Daniel Tumpson