April 7, 2022
The following comments are from Charles Poggi, owners of 1501 Adams Street – the site that the City of Hoboken wants to condemn to make way for a new multi-faceted municipal complex
The city’s community meeting Monday, April 4 to present more information about the municipal complex the administration wants to build on Adams Street was, I thought, self-serving and misleading
First, the presentation left residents with the impression that the city owns the property it wants to build its municipal complex on. It does not. I do. And I remain opposed to the government confiscation of my property at 1501 Adams Street.
The second thing that struck me was the proposed cost of the project and the way the city says it will pay for it. The cost ranges from $152 million to $192 million are staggering. Was the administration not paying attention when the $241 million school bond referendum was decisively defeated in January by the people of Hoboken?
The city’s proposed method to pay for the building is head scratching – if not deceiving. The director of environmental services, Jennifer Gonzalez, said on Monday that the city would get developers to pay for it. But her explanation is not accurate. Developers will not be reaching into their pockets to pay for the municipal complex. Instead, the city is going to take the PILOT money – the Payment in Leu of Taxes – or in other words the tax break that the city gave to the developers – and apply that money to the municipal complex cost.
Gonzalez cited two projects that have received PILOTs – the LCor project which pays $21.5 million a year in lieu of actual property taxes and the Neuman Leather development, whose PILOT payment is $31.7 million, according to Gonzalez. If the city applies the two pilots that total $53.2 million to paying for the Adams Street project; that leaves a $53 million hole in the city’s yearly revenue? How is that revenue going to be made up? With higher taxes?
How much is the city currently receiving from the PILOTS for LCor and Neuman Leather? Are the numbers cited by Gonzales payments the town is receiving now, or will receive at some time years down the line.
Gonzalez said that further funding for the project will come from other PILOTs granted to other developers. Therefore, the city is willing to give more tax breaks to developers to pay for its complex – but the reality is that the city can’t pay for its project by diverting revenue needed to provide services and pay employees.
I’m not sure the PILOT plan is workable. My understanding on the way PILOTS work, is that the developer makes payments to the town on an escalating scale over 20 or 30 years. Often payments in lieu of taxes don’t kick in for several years and start at a relatively low amount. Will there be enough revenue to pay for the city’s project?
The city’s plan sounds like voodoo math. I believe my original redevelopment proposal would have been better for the city and the residents of the North End.