Maplewood Releases Financial Analysis on Post Office PILOT

by The Village Green
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The Maplewood Township Committee released a 10-year financial analysis Monday on the PILOT (payment in lieu of taxes) financial abatement it is considering granting JMF Properties, the developer of the Maplewood Post Office.

The analysis can be found on the Township website.

Download (PDF, 382KB)

The TC will hold a public hearing and vote on Tuesday, April 7 on the PILOT ordinance. Committee members voted 4-1 at its last meeting to introduce the ordinance; India Larrier voted against, saying she was “not convinced the PILOT is appropriate for this site” and that it was “prime property.”

Several residents spoke against the tax abatement, arguing that it was unnecessary and doesn’t make financial sense for the township.

“I think you should vote no…” said former TC member David Huemer. “You’re going to give [the developer] about a $320,000 tax break over five years. If that’s what it takes to get this project [done] that’s another sign this project is not in the best interest of Maplewood.”

The township’s analysis compares the current value of the land and building at the post office site with the proposed new development.

The PILOT ordinance can be found here.

Here is the complete text of the email from the Township:

On April 7, 2015 at 7:30pm, the Maplewood Township Committee will hold a public hearing and consider on final passage, Ordinance 2778-15, Authorizing the Execution Of A Tax Agreement With Maplewood Redevelopers, LLC And Granting a Tax Exemption: 5 Year Tax Abatement Pursuit To State Statute. This is for the post office site on Maplewood Avenue.

The Township of Maplewood is the current property owner and now there are no property taxes collected from the site.

Below is a ten year tax payment analysis comparing the current value of the land and building at the post office site with the proposed new development receiving a five-year tax abatement (PILOT).

From 2016 through 2025, the total estimated tax payments on the existing land and building are $678,730. The total estimated tax payments on the proposed new development are $1,009,582, which is an increase of $330,852. After 2025, the proposed new development will generate over $85,000 more in taxes per year than the taxes for the existing land and building.

The current land value for the post office site is $696,800 and the value of the building (improvement) is $978,500. The 2014 Maplewood tax rate (municipal, library, open space, school and county portions) is $3.524 per $100 of value. The 2015 tax rate has not yet been determined.

The comparisons start with the 2016 tax year. The estimated tax rate for 2016 is $3.70 per $100 of value, which is five percent more than the 2014 tax rate.

The estimated value of the building (improvement) with the proposed new development is estimated by the Tax Assessor to be $2,887,700. During the five-year PILOT period (2017-2021), land taxes are paid in full and the taxes on the improvement are phased in by 20 percent each year after the first year.

 

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