West New York has granted a payments-in-lieu-of-taxes (PILOT) agreement to a redeveloper to support the construction of new waterfront residential buildings.
Mayor Gabriel Rodriguez and the West New York Board of Commissioners adopted the financial agreement ordinance at the August meeting after it was introduced in July. Previously, the ordinance was introduced at the May meeting this year, but withdrawn at the recommendation of corporation counsel.
Two new Riverbend buildings
Now the town is moving forward with the financial agreement with RB III Apts Urban Renewal, LLC to support the construction of two new buildings at the Riverbend redevelopment. The property is located on the eastern side of Port Imperial Boulevard, in the town’s Controlled Waterfront Development Zone.
Riverbend Building Company II, LLC, an affiliate of the previously mentioned entity, got approval from the the West New York Planning Board for the project in November of 2020. But the redeveloper had to make modifications to the site plan due to changes in FEMA’s policies regarding below grade parking in multifamily buildings, requiring it to be heard again at the May meeting after which the board passed a resolution approving the project at its April meeting.
Under the approvals, the redeveloper adjusted the lot line between two parcels so that the one lot with an existing decreased in size from 3.15 acres to 2.997 acres and another lot increased in size from 1.73 acres to 1.881 acres.
On the lot that was increased, the redeveloper will demolish the existing Buildings 2 and 3 of the Riverbend development and construct two new residential buildings with rental units at market rate, according to the ordinance. The new Riverbend 2 building will have 164 units, an increase from the existing building which contains 87 units; the new Riverbend 3 building will have 426 units, an increase from the existing building containing 126 units.
Inside the 30-year financial agreement
According to the ordinance, the project would not be feasible without the financial assistance of the town, leading to the redeveloper applying for the PILOT agreement. As such, the redeveloper sought to support the project by applying for a PILOT agreement, as is allowed per the state’s Long-Term Tax Exemption Law.
After review of the request together with the town attorney, redevelopment counsel and the town’s financial advisor, the mayor has recommended that the long-term tax exemption and financial agreement be approved, according to the ordinance. The ordinance authorizes the town to accept, in lieu of real property taxes, an annual service charge to be paid by the redeveloper.
The PILOT will be for a 30-year term with an annual service charge based on 11.5 percent of annual gross revenues for years one to five. The annual service charge increases to 12 percent for years six to 10; 12.5 percent for years 11 to 15; 13 percent for years 16 to 20; and 14 percent for years 21 to 30.
The property currently generates $1,400,000 per year in real estate tax revenue. The projected annual service charge over the 30-year term will generate an annual average of approximately $2,600,000, according to the ordinance. The project is also estimated to create temporary jobs during construction, as well as permanent jobs.
Ordinance approved unanimously
No members of the public or board members spoke at the public hearing for the ordinance at the August 10 meeting. Subsequently, it was adopted unanimously.
The next meeting of the West New York Board of Commissioners is on September 7 at 6:30 p.m. For more information, go to westnewyorknj.org.
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