Mayor defends possible PILOT program
I am writing in response to a letter written by Carol Gunn-Kadish, wife of Vernon Township Councilman Dan Kadish, in which she claims “Waterpark PILOT program would be bad for Vernon.” Her letter contains inaccurate and misleading statements that would deceive the public.
Misinformation and misleading the public seem to be the Kadishes’ stock-in-trade. Because the PILOT (Payment In Lieu of Taxes) issue is a complicated one, the majority of the public may be misled and unduly angered by the misinformation Ms. Kadish is spreading, particularly her statement that the waterpark is “nothing more than a Trojan horse.” That statement in itself is deceptive and attempts to defame and malign the developer and accuse him of being subversive and attempting to conceal something.
Ms. Kadish quotes numbers and a proposal made by the developer, but the truth is that no agreement has been decided yet. In our form of government, the mayor negotiates all contracts. Once the negotiations are complete, the mayor presents them to the governing body, the Township Council. The agreement is between the developer and the township.
She states that the developer “admitted” that all his Mountain Creek property is in a redevelopment area. The redevelopment designation for his property was approved by the prior governing body and by the state, and the developer is entitled to it, as well as all state statutes associated with redevelopment zones.
She further alleges other redevelopment zones in the township when in reality there are none. As for the 1,100 condo units the developer has approval from a prior governing body to build, it is not accurate to say they could all have urban renewal entities created with PILOTs or that future residents will be paying 50 percent taxes for 30 years.
Commercial PILOTs in the state have been fairly successful. Problems with PILOTs have mostly been only in residential areas, and I personally do not support PILOTs for residential properties. Just because the township is thinking about a PILOT for the indoor waterpark hotel does not mean the town would approve others elsewhere. To say otherwise is disingenuous and serves only to create fear and anger in the public.
Ms. Kadish’s argument about inflation is a red herring. If there is no PILOT and Mountain Creek builds this facility, the assessed value would generate $3.25 million in taxes. In the second year after construction, Mountain Creek could appeal the assessment based on one of three factors: 1) construction cost, 2) comparable sales, 3) or gross profits. The appellant gets to choose which form to be considered. Since there would be no profit on the first few years after construction, the developer could easily file an appeal based on gross profits and that appeal would likely be successful, driving down significantly the amount of taxes generated from the hotel.
Ms. Kadish claims, “The mayor and the majority of the council who are going to make this happen are mesmerized by the prospect of getting $1.2M a year” from the PILOT, and accuses us of being ”awestruck, like kids staring at a piece of fool's gold.” No one is mesmerized by the numbers, Ms. Kadish. Unlike your husband, who does not seem to research anything facing the township or have personal knowledge about the issues, we are very keenly aware and have been through all of the analysis.
That property currently generates $15,000 a year in taxes, of which the Board of Education gets 60 percent annually, for a total of only $9,000 a year. What is not to like about $1.2 million in tax revenues the PILOT would generate for the township, or the $162,000 a year the Board of Education would receive, which is more than 20 times what it gets from that property right now? Furthermore, this project is not going to put children in the schools.
What happens if a bankruptcy occurs? Vernon Township is not responsible for 1 red cent. We are not giving any guarantees of Mountain Creek debt. In fact, through state statues governing tax and PILOT payment collections the township maintains its priority position.
The most disingenuous of Ms. Kadish’s arguments is her assertion that “Pretty soon, the only ones paying full taxes are us, the poor homeowners … we can't get our taxes reduced by half or have part of our taxes pay our monthly mortgage.”
Councilman Dan Kadish and his wife Carol Kadish, of all people, are not paying full taxes because their property is farmland assessed. They received $800,000 in farmland preservation, which is funded by taxpayers. How much of a tax break was that for them? They had their taxes reduced through farmland assessment and the $800,000 they received probably paid off their entire mortgage several times over. The hypocrisy of Ms. Kadish’s letter makes reasonable people wonder what is her true motive.
Please stop feeding the public misinformation, Ms. Kadish. To argue that a PILOT would “hurt poor taxpayers” is disingenuous because the truth is it could reduce taxes, just as this administration has reduced municipal property taxes for the past three years. If the developer does not get the PILOT, the resort will not be built and the township will lose the opportunity to increase employment, to bolster the sales of shops and restaurants in our town, and to help our resort, which has been in Vernon more than 50 years, to compete successfully with the many resorts in the Poconos, the Catskills, as well as the Jersey shore.
Victor J. Marotta
Vernon Township Mayor