PILOT = No Taxes For Berkeley Heights Schools
I would like to present this article for everyone on this list to read in their time off. It is short but very very important. It is a quick overview of PILOT ( Payment in Lieu of Taxes ).
Why this is important for Berkeley Heights is that the town seems to be throwing the PILOT term around quite a bit and what we need to realize is that the SCHOOLS get $0 from typical PILOT deals.
From the article:
What are major arguments *against* tax abatements?
--Departure from Equitable Tax Principles. An abatement is a departure from “equitable tax principles,” in which everyone pays his or her equal share of property tax.â 4 As such, abatements should be used “sparingly.”
--Questionable Assessment of “Blight”. Tax abatements have been granted as a negotiating tool for cities looking to attract investment, instead of for properties afflicted by “blight.”
--Lack of Transparency. Each abatement is negotiated individually, so there is no single document the public can reference to understand abated properties in the aggregate. The public’s only means of understanding an individual abatement is to read the abatement itself, which is by its nature written in legalese with financial terms that may be opaque to the average resident. Further, cost-benefit analyses are not typically provided to the public to explain why the abatement was necessary.
--Exclusion of Key Stakeholders. Typically the city government and the developer are the only stakeholders involved in the abatement terms. The consequence is the city government typically keeps the entire abatement fee instead of distributing it to recipients of a typical property tax, such as the public schools.
--Lack of state oversight. There is minimal to no oversight of municipal use of tax abatements.â
I believe that all home owners in our town should understand
what the term PILOT means and how it affects our schools and
general fairness for the tax payers in town.