Also, the committee authorized the four-year contract for local PBA with raise in salary increases
At last week’s meeting, the Harrison Township Committee voted to enter a Payment in Lieu of Taxes agreement with Naples Ristorante and Mullica Hill Surgical Arts Urban Renewal Entity, LLC. Although both companies would be part of PILOT programs, the agreements vary greatly in individual tax abatements and benefits.
According to Mayor Louis Manzo, a PILOT program exempts specific properties from traditional taxes, which are then replaced with payment in lieu of taxes in an amount equivalent to what the traditional taxes would have been for a 30-year term. The benefit of a redevelopment PILOT program is the township’s ability to obtain 95 percent of the payment, with 5 percent distributed to the county, while traditional taxes would only provide the township with 15 percent of the revenue. Also, PILOT programs provide coverage for debt, Manzo said, as the 30-year program overlaps 20-year bond financing agreements.
According to Manzo, the existing Mullica Hill Gardens Assisted Living facility PILOT program provides Harrison Township with approximately $124,000 per year, for 30 years. Without the PILOT program, Manzo said, Harrison Township would collect about $24,000.
While the Mullica Hill Surgical Arts center will enter a similar, standard PILOT agreement based on its final assessed value by the county, Naples Ristorante will be receiving a tax abatement for a portion of its 30-year PILOT agreement.
Naples, a business within the Mullica Hill Historic District, is designated as a redevelopment zone alongside the 131 additional downtown properties. The designation, which is required for PILOT programs, allows the township to provide an incentive to Main Street property owners to improve their structures.
“We knew if we used redevelopment and PILOT options we would be able to give substantial incentives to property owners going forward to have them invest substantial money in these properties,” Manzo said.
Last year, Naples purchased a liquor license for $500,000 with plans to transform the restaurant into a Main Street destination, complete with a bar, second-story seating and outdoor improvements. Through the redevelopment incentives and PILOT agreement, Naples will still be required to pay the amount equivalent to the property’s land tax, however Harrison Township has agreed to abate a portion of the property’s improvement taxes for approximately 10 years, depending on the final assessment value.
“In our fiscal plan, the idea is as the PILOT revenue comes online, one takes care of the other,” Manzo said. “Options become available as those revenues become available.”
According to Manzo, at any time throughout the PILOT program, because it is an agreement, negotiations can be revised, stopped or restarted.
In other news:
• Committee authorized the execution of the Police Benevolent Association №178 four-year contract, effective Jan. 1 through Dec. 31, 2021.
According to Manzo, the previous contract’s 2.25 percent average salary increase throughout four years was raised to 2.375 percent. However, for the first year, in 2018, police will not be receiving salary increases.
“It’s monumental,” Manzo said. “That’s half of our employees, and more than half of our salaries. In 2018, we do not have to increase almost 60 percent of our salary base for that year.”
Additional changes to the contract were made in regard to health benefits, such as vision and dental. For an annual cost of $11,027, the township was able to provide vision insurance for every employee in the municipality.
