Emails Obtained Through OPRA Undercut Berkeley Heights Council Claims on Terrace II PILOT  

A newly obtained email exchange (through OPRA) shows the Berkeley Heights Township Administrator expected discussions over a Terrace II PILOT to begin “soon” once the developer applied, which appears to contradict later claims by Council members that no PILOT was under consideration.

A PILOT is a highly controversial tax exemption that sends 95% of the revenue to the municipal government, 5% to the county and no direct share to the schools. The Town hasn’t shared any of its existing PILOT revenue with the District and has not answered our questions as to when that will change, leaving Berkeley Heights families to cover the educational costs of students from these developments while developers receive an exemption from conventional property taxes.

Earlier this month, School Business Administrator Jennifer Nicholson asked Township Administrator Liza Viana to include the BOE in discussions about how future Terrace II PILOT revenue would be used.

“As the anticipated revenues from Terrace II have not yet been incorporated into the Township’s long-term financial planning I would appreciate the opportunity for the Board of Education to be included in those discussions from the onset,” Nicholson wrote.

Viana responded on July 10.

“This developer has not yet applied for a PILOT,” Viana wrote. “I’m sure we will have these discussions soon once he does.”

This certainly frames Illis’s response to our inquiry as splitting hairs. She stated:

“The council DID explain that there is no PILOT under consideration and when and if there is then our position or actions will be communicated.”

It also appears to conflict with John Foster’s “I wouldn’t bet on it” framing after a resident explained that one odds website placed the property’s chances of receiving a PILOT above 90%.

Viana didn’t say Terrace II was not expected to become a PILOT and her use of “once he does,” rather than “if he does,” leads to a reasonable interpretation that she expected an application and discussions to follow.

One can argue that things may have changed since this 07/10 email, however, the position the council has been taking of ‘why is everyone talking about a PILOT, where is this coming from?” pre-dates this email. Prior to the June 30th meeting and days before the exchange between Viana and BHPSNJ, I sent an email asking about Terrace II and received no response.

I attended the 06/30 Meeting to follow up with the Council and, as usual, the Attorney spoke for the Council in repeating that ‘no PILOT is approved’ – which is, again true, but not really the point as the agreement makes clear that a PILOT will likely be approved.

As we’ve explained, we don’t really need to read the tea leaves, as this exchange is consistent with the Terrace II redevelopment agreement dated July 1. Section 10.3 says the developer “expects to submit” a tax-exemption application and makes the agreement contingent upon the Township approving that application and executing a Financial Agreement. If that agreement is not executed within 120 days, unless the deadline is extended, the redevelopment agreement automatically terminates.

If a PILOT is no longer expected, Council members could have said that during the meeting. But to act as if there was no basis for the questions, despite both an agreement and communication with the District based on that premise, comes across as confusing.

If a PILOT is still something the Township expects, then their reactions to resident questions about revenue sharing with the District become even harder to understand.

Either way, for many residents, the Council’s messaging has not only been confusing but tone deaf as residents have expressed their frustration with the lack of revenue sharing with the PILOTs already in place and the disingenuous messaging on PILOTS that we addressed earlier this year.

This occurs in a context where Berkeley Heights families voted to pass a school referendum this year approving millions of dollars to address issues that are normally addressed through typical budget cycles.

See Email Exchange

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