[Adopted 4-22-2008 as Sec. 2 of Ord. No. 2008-1]
The Township of Willingboro, pursuant to N.J.S.A. 40A:20-1 et
seq., shall utilize the tax exemption and abatement provisions authorized
by the New Jersey State Legislature in the consideration of all applications
for abatements or exemptions under the long-term exemption and abatement
laws for residential structures and commercial projects as defined
herein.
As used in this article, the following terms shall have the
meanings indicated:
The exemption of property from real estate taxes, subject
to the payment of an annual service charge in lieu of taxes, authorized
pursuant to the provisions of the Long-Term Tax Exemption Law (N.J.S.A.
40A:20-1 et seq.). Where an abatement or exemption is authorized pursuant
to the provisions of the Long-Term Tax Exemption Law, real estate
taxes levied on the value of land shall continue to be assessed for
the purpose of general taxation, except as otherwise provided by state
statute.
The Long-Term Tax Exemption Law (N.J.S.A. 40A:20-1 et seq.).
The contract entered into between the Township of Willingboro
and an entity pursuant to the Act.
The information and data required to be submitted by an entity
requesting an abatement or exemption, as required by the Township.
A financial statement or report of the fiscal operations
of a project, including but not limited to revenues and expenses,
which shall be submitted annually pursuant to N.J.S.A. 40A:20-9(d).
The contents of an audit shall be prepared in a manner consistent
with the current standards of the Financial Accounting Standards Board,
shall fully detail all items required by applicable statutes, and
shall be certified as to its conformance with such standards by a
certified public accountant who is licensed to practice that profession
in the State of New Jersey.
Substantially ready for the intended use for which a building
or structure is constructed, improved or converted.
An urban renewal entity meeting the qualifications set forth
in N.J.S.A. 40A:20-5.
A combination of land, improvements and equipment which have
been integrated into a functioning unit intended for the assembling,
processing and manufacturing of finished or partially finished products
from raw materials or fabricated parts, but shall not include warehouses;
and
Where the Municipal Council determines that the project will
maintain or provide gainful employment within the Township, assist
in the economic development of the Township, maintain or increase
the tax base of the Township and maintain or diversify and expand
commerce within the Township.
The masculine, feminine or neuter gender, the singular as
well as the plural, as proper meaning requires.
The work or undertaking which has as its purpose the redevelopment
of all or any part of a redevelopment area, in accordance with N.J.S.A.
40A:20-3(e).
The real property and improvements thereon which existed
prior to the execution of a financial agreement.
As used in this article, the following terms shall have the
meanings indicated:
The Director of Finance or person designated to develop,
maintain and enforce a uniform system of accounts, including forms,
standards and procedures for all departments of the municipal government.
The person designated to conduct, manage and oversee development
programs and projects of the Township of Willingboro.
The person elected as the Mayor of the Township of Willingboro,
New Jersey.
The person with such powers to perform duties as are provided
for the office of Township Solicitor by general law or ordinance of
the Township. The Township Solicitor shall represent the Township
in all judicial and administrative proceedings in which the Township
or any of its officers or agencies may be a party or have an interest.
The Solicitor shall give legal counsel or advice required by the Manager,
Council or any other member thereof and shall in general serve as
the legal advisor to the Council and Manager on all Township business.
The officer of a taxing district designated with the duty
of assessing real property for the purpose of general taxation in
the Township of Willingboro.
The elected officials designated as the Township Council
of the Township of Willingboro.
The chief executive and administrative officer of the Township.
The Manager shall see that all ordinances, resolutions and policies
of the Council and all state laws subject to enforcement by municipal
action are faithfully enforced and executed.
An entity meeting the qualifications delineated in N.J.S.A.
40A:20-5 and seeking an exemption, before proceeding with any projects,
shall make written application to the Township of Willingboro for
approval.
A.
All applicants shall utilize the application adopted by resolution
by Township Council and on file with Township Clerk for distribution.
The application form may be revised from time to time, subject to
the approval of the Township Council by resolution. The application
shall include but not be limited to:
(1)
A general statement of the nature of the proposed project, that the
undertaking conforms to all applicable municipal ordinances, and that
the project accords with the Redevelopment Plan and Master Plan of
the Township or, in the case of a redevelopment relocation housing
project, provides for the relocation of residents displaced or to
be displaced from a redevelopment area or, in the case of a low- and
moderate-income housing project, the housing units are restricted
to occupation by low- and moderate-income households.
(2)
A description of the proposed project outlining the area included
and a description of each unit thereof if the project is to be undertaken
in units and setting forth architectural and site plans as required.
(3)
A statement prepared by a qualified architect or engineer of the
estimated cost of the proposed project in the detail required, including
the estimated cost of each unit to be undertaken.
(4)
The source, method and amount of money to be subscribed through the
investment of private capital, setting forth the amount of stock or
other securities to be issued therefor or the extent of capital invested
and the proprietary or ownership interest obtained in consideration
therefor.
(5)
A fiscal plan for the project outlining a schedule of annual gross
revenue, the estimated expenditures for operation and maintenance,
payments for interest, amortization of debt and reserves, and payments
to the Township to be made pursuant to a financial agreement to be
entered into with the Township.
(7)
Schedule of the construction of the project.
(8)
An estimate by the entity as to the number and type of jobs to be
created by the project during the period of construction and the number
and type of permanent jobs to be created by the project within one
year after the completion date. The application shall contain the
affirmative action plan of the entity and a certification by the entity
that such plan complies with the affirmative action requirements of
the Township.
B.
Application fee. No application for exemption shall be accepted unless it is accompanied by full payment of the required application fee. The required administrative fee shall be 2% of the annual service charge, pursuant to the provisions of § 338-31 herein, for the project. In the event Township Council permits the transfer of an abatement from one entity to another pursuant to § 338-27, there shall be an administrative fee for processing the request for the transfer and/or assumption of the tax exemption and financial agreement. The fee shall be 2% of the annual service charge for the current year. All applicants shall submit a nonrefundable certified check payable to the Township of Willingboro for administrative fees.
A.
Distribution of application. Upon receipt of any application, the
Township Manager shall distribute one copy of the application to the
Development Officer, one copy to the Chief Financial Officer, one
copy to the Tax Collector, and three copies to the Township Solicitor.
The final copy of the application shall be retained by the Tax Assessor
and shall be placed on permanent file within the Assessor's office.
B.
Development review.
(1)
Upon receipt of an application, the Development Officer shall conduct
a complete review of the project. Such review shall take into consideration
the suitability, propriety, and accuracy of the property, description(s),
plan(s) and estimate(s) submitted, the degree to which the project
complies with the Township's development goals as expressed in
the Township's Master Plan, zoning ordinances, and redevelopment
plans and the degree of economic necessity of the tax abatement for
the project.
(2)
Based upon the review, the Development Officer shall submit his report
of the application to the Chief Financial Officer. Such report shall
include any changes to the application that may be deemed necessary
by the Development Officer, as well as a detailed explanation as to
the analysis conducted to arrive at the report.
C.
Financial review. Upon receipt of an application, the Chief Financial
Officer shall conduct a financial review of the application, including
a cost and benefit analysis of the proposed project. In addition,
the Chief Financial Officer shall obtain written certifications of
the information contained within the application. Those certifications
shall include the following:
(1)
Certification of the Tax Assessor as to:
(a)
The taxes levied on the real property included within the project
in both the year in which the application was filed and the immediately
preceding year.
(b)
The current status of payments due for real estate taxes, service
charges and/or municipal liens of any type arising from the property
included within the project or from any other property owned by the
entity.
(c)
The current status of payments due for any financial agreement
then in force and effect which the entity is a party.
(d)
The status of payments due for water and sewer services provided
to the real property included within the project or other real property
within the Township, which the entity has an interest.
(e)
The precise identity of all real property included within the
project, including the metes and bounds description, all tax block
and lot designations and corresponding street addresses, as well as
a survey or plotting of the property on the Official Tax Map.
(f)
The owner of record as recorded in the office for each tax lot
included within the project.
(g)
The tax assessment for land and improvements then in effect
for each tax lot included within the project.
(h)
The total amount assessed on all real property included within
the project in the calendar year immediately preceding its acquisition
by the Township, the Township's agent, the entity or the entity's
agent.
(i)
The taxes levied on the real property included within the project
in both the year in which the application was filed and the immediately
preceding year.
(2)
Based upon the review, the Chief Financial Officer shall submit his
report on the application to the Township Solicitor. Such recommendation
shall include any changes to the application that may be deemed necessary
by the Chief Financial Officer, as well as a detailed explanation
as to the analysis conducted to arrive at the report.
D.
Legal review. Upon receipt of an application, the Township Solicitor
shall conduct a review as to the form and legality of the application.
In addition, the Township Solicitor shall obtain written certifications
from Township officials as necessary to substantiate the information
contained in the application. The Township Solicitor shall review
any financial agreements then in force and effect to determine the
extent to which each party to the application is a party to any other
agreements with the Township and whether they are current on their
obligations in those agreements; and make a determination as to the
propriety of the application. Applications shall be deemed proper
in those cases where they are presented in the proper form, satisfy
the requirements of this article and all other applicable statutes
and ordinances and for which no delinquency has been found with respect
to any payments due to the Township. Where an application is deemed
proper, the Township Solicitor shall prepare an ordinance in the form
necessary to authorize the exemption and shall prepare the form of
the financial agreement. All financial agreements shall be in the
form filed with the Township Clerk. The authorizing ordinance shall
be signed by the Township Solicitor as to form and legality and submitted,
together with the financial agreement, the application, the certifications
and the report of the Chief Financial Officer and the Development
Officer, to the Township Manager for consideration. Where an application
is deemed improper or deficient, the Township Solicitor shall prepare
a correspondence outlining those aspects of the application that are
deficient and shall forward the correspondence with the application,
the certifications and the report of the Chief Financial Officer and
the Development Officer to the Township Manager for consideration.
E.
Township Manager review.
(1)
Upon receipt of an application and recommendations from the Township
Solicitor, the Township Manager shall determine the action to be taken
in regard to an application. When an application is deemed complete
and deemed proper by the Township Solicitor, the Township Manager
shall determine whether to recommend the adoption of the authorizing
resolution by Township Council or to recommend the rejection of the
application as not being in the interests of the Township. Where an
application has been deemed improper by the Township Solicitor, the
Township Manager shall determine whether the deficiencies can be cured
and, if so, may recommend to Township Council that the entity have
the opportunity to revise the application. If the deficiencies cannot
be cured or if the application is deemed not in the interest of the
Township, the Township Manager may recommend the rejection of the
application.
(2)
In those cases where the Township Council affords the entity the
opportunity to cure deficiencies, the application may be reconsidered
after correction or modification by submission to the Township Manager.
Afterwards, the process outlined in this article shall be followed
again. No fee shall be charged for consideration of a resubmitted
application.
(3)
In those cases where the Township Manager has recommended the rejection
of an application and where such action has been ratified by the Township
Council, the application may only be reconsidered by the submission
of another application and application fee to the Township Manager,
which shall be treated as a new application.
(4)
The recommendation of the Township Manager to Township Council, whether
for approval or rejection, shall occur within 60 calendar days after
the date of receipt of a complete application.
F.
Township Council consideration. Upon receipt of a proposed resolution
to authorize approval of the application, the financial agreement,
the application, together with all of the documents which were submitted
by the applicant, the certifications and the Township Manager's
recommendation, Township Council shall place such resolution on the
agenda for consideration. Upon action by Township Council, a resolution
may be adopted approving, rejecting or returning the application to
the Township Manager for correction, modification or further information.
Notice of the adoption of an ordinance granting an exemption and approving
a financial agreement shall be published by the Township Clerk pursuant
to N.J.S.A. 40A:20-12.
A.
Form of financial agreement. The financial agreement shall be in
the form appropriate to the nature of the project, as on file with
the Township Clerk and approved by the Township Council, and requiring
full performance within 30 years from the date of completion of the
project and shall include the following:
(1)
That the profits of or dividends payable by the entity shall be limited
according to terms appropriate for the type of entity.
(2)
That all improvements and land in the project to be constructed or
acquired by the entity shall be exempt from taxation.
(3)
That the entity shall make payments for municipal services.
(4)
That the entity shall submit annually, within 90 days after the close
of its fiscal year, its auditor's reports to the Mayor and Township
Council and to the Director of the Division of Local Government Services
in the Department of Community Affairs.
(5)
That the entity shall, upon request, permit inspection of property,
equipment, buildings and other facilities of the entity, and also
permit examination and audit of its books, contracts, records, documents
and papers by authorized representatives of the Township of Willingboro
or the state.
(6)
That, in the event of any dispute between the parties, matters in
controversy shall be resolved by arbitration in the manner provided
in the financial agreement.
(7)
That operation under the financial agreement shall be terminable
by the entity pursuant to N.J.S.A. 40A:20-1 et seq.
(8)
That the entity shall at all times prior to the expiration or termination
of the financial agreement remain bound by the provisions of the New
Jersey tax abatement laws.
(9)
The entity shall provide a detailed representation and covenant as
to the manner in which it proposes to use, manage or operate the project.
(10)
The financial agreement shall further set forth the method for
computing gross revenue for the entity, the method of determining
insurance, operating and maintenance expenses paid by a tenant which
are ordinarily paid by a landlord, the plans for financing the project,
including the estimated total project cost, the amortization rate
on the total project cost, the source of funds, the interest rates
to be paid on the construction financing, the source and amount of
paid-in capital, the terms of mortgage amortization or payment of
principal on any mortgage, a good faith projection of initial sales
prices of any condominium units and expenses to be incurred in promoting
and consummating such sales, and the rental schedules and lease terms
to be used in the project. Any financial agreement may allow the Township
to levy an annual administrative fee, not to exceed 2% of the annual
service charge.
(11)
The financial agreement shall require the timely submission
of a certified audit of the total project cost and a certified audit
of the fiscal operations of the project and shall require timely payment
of all municipal taxes, fees and charges arising out of the agreement
or in any way arising out of the property. The financial agreement
shall provide that the failure to comply with the requirement to submit
certified audits, make payment of municipal taxes, fees and charges,
or failure to comply with any material condition of the agreement
shall be grounds for the Township to terminate the agreement and/or
to exercise such other remedies as may be provided by statute, municipal
ordinance or the financial agreement.
B.
Execution of financial agreement. Upon adoption of an ordinance by
the Township Council authorizing the exemption and financial agreement,
it shall be the responsibility of the Township Clerk to insure that
the financial agreement is fully executed. No financial agreement
shall be considered to be in force and effect unless and until it
has been signed by the entity, the Township Manager, and the Mayor
and dated and certified by the Township Clerk by signature and affixing
the Municipal Seal.
C.
Distribution of executed financial agreement. When a financial agreement
has been fully executed, the Township Clerk shall be responsible for
distributing certified copies thereof to the entity, the Tax Assessor,
the Township Manager, the Construction Official and the Township Solicitor.
The Township Clerk shall retain one executed copy which shall be placed
on permanent file with his/her office, where it shall be available
for examination during regular business hours. Further, the Township
Clerk shall forward a certified copy of all ordinances approving an
exemption and the accompanying financial agreement to the Director
of the Division of Local Government Services, pursuant to N.J.S.A.
40A:20-12.
D.
Financial agreement payment schedule.
(1)
The financial agreement shall establish a schedule of annual service
charges to be paid over the term of the exemption period, which shall
be in stages as follows:
(a)
For the first stage of the exemption period, which shall commence with the date of completion of the unit or of the project, as the case may be, and continue for a time of not less than six years nor more than 15 years, as specified in the financial agreement, the urban renewal entity shall pay the Township an annual service charge for municipal services supplied to the project in an annual amount equal to the amount determined pursuant to § 338-31. For the remainder of the period of the exemption, if any, the annual service charge shall be determined as follows:
[1]
For the second stage of the exemption period, which shall not be less than one year nor more than six years, as specified in the financial agreement, an amount equal to either the amount determined pursuant to § 338-31 or 20% of the amount of taxes otherwise due on the value of the land and improvements, whichever shall be greater;
[2]
For the third stage of the exemption period, which shall not be less than one year nor more than six years, as specified in the financial agreement, an amount equal to either the amount determined pursuant to § 338-31 or 40% of the amount of taxes otherwise due on the value of the land and improvements, whichever shall be greater;
[3]
For the fourth stage of the exemption period, which shall not be less than one year nor more than six years, as specified in the financial agreement, an amount equal to either the amount determined pursuant to § 338-31 or 60% of the amount of taxes otherwise due on the value of the land and improvements, whichever shall be greater; and
[4]
For the final stage of the exemption period, the duration of which shall not be less than one year and shall be specified in the financial agreement, an amount equal to either the amount determined pursuant to § 338-31 or 80% of the amount of taxes otherwise due on the value of the land and improvements, whichever shall be greater.
(2)
If the financial agreement provides for an exemption period of less
than 30 years from the completion of the entire project, or less than
35 years from the execution of the financial agreement, the financial
agreement shall set forth a schedule of annual service charges for
the exemption period which shall be based upon the minimum service
charges and staged adjustments set forth in this section. The annual
service charge shall be paid to the Township on a quarterly basis
in a manner consistent with the Township's tax collection schedule.
A.
Transfer to another entity.
(1)
The Township may, in its discretion, consent to the sale of a project
by an entity to another entity organized pursuant to N.J.S.A. 40A:20-1
et seq., their successors, assigns, all owning no other project at
the time of the transfer, and that, upon assumption by the transferee
entity of the transferor's obligations under the financial agreement,
the tax exemption of the improvements thereto and, to the extent authorized
by law, the land shall continue and inure to the transferee entity,
its respective successors or assigns.
(2)
If an entity purchases an existing project from another entity, the
purchasing entity shall compute its net profits, if any, commencing
with the date of acquisition of the project. The date of transfer
of title of the project to the purchasing entity shall be considered
to be the close of the fiscal year of the selling entity. Within 90
days after the date of the transfer of title, the selling entity shall
pay to the Township the amount of reserve, if any, maintained by it
pursuant to this section, as well as the excess net profit, if any,
payable pursuant to this section.
B.
Transfer to a purchaser of a condominium. The Township may, in its
discretion, consent to a sale of the project by an entity to purchasers
of units in a condominium if the project or any portion thereof has
been devoted to condominium ownership, and to their successors, assigns,
all owning (in the case of housing) no other condominium unit of a
project at the time of the transfer, and that, upon assumption by
the condominium unit purchaser of the transferor's obligations
under the financial agreement, the tax exemption of the project buildings
and improvements and, to the extent authorized by law, the land shall
continue and inure to the unit purchaser, his respective successors
or assigns.
C.
Transfer to a purchaser in fee simple. The Township may, in its discretion,
consent to a sale of the project by an entity to purchasers of units
in fee simple, if the project or any portion thereof has been devoted
to fee simple ownership, and to their successors, assigns, all owning
(in the case of housing) no other fee simple unit of a project at
the time of the transfer, and that, upon assumption by the fee simple
unit purchaser of the transferor's obligations under the financial
agreement, the tax exemption of the project buildings and improvements
and, to the extent authorized by law, the land shall continue and
inure to the fee simple unit purchaser, his respective successors
or assigns. The provisions of this subsection shall not be interpreted
to authorize the sale of a project between an entity and a for-profit
developer.
D.
Administrative fee for transfer. The Township shall levy an administrative fee, not to exceed 2% of the annual service charge, for the processing of any request for the continuation of a tax exemption pursuant to any financial agreement which provides for consent under to Subsection A, B or C of this section.
During the period of construction of a project, the Tax Assessor
and Construction Official shall each be responsible for oversight
of the project and the agreement as follows:
A.
Permits and inspections. Upon receipt of an executed financial agreement,
the Construction Official shall cause permits to be issued upon the
application of the entity and shall cause inspections of all work
activity to be conducted in the manner provided by applicable Township
ordinances. The Construction Official shall notify the Tax Assessor
of any failure by the entity to properly apply for permits, to begin
or complete construction within the time frame set forth in the financial
agreement. When permits are issued, the Construction Official shall
be responsible for notifying the Tax Assessor of such issuance.
B.
Quarterly report to assessment. From the date of the execution of
a financial agreement until the issuance of a permanent certificate
of occupancy for the project, the Construction Official shall report
to the Tax Assessor each quarter as to the status of permit and construction
activity on the project. Upon the total or partial completion of construction,
the Construction Official shall issue a certificate of occupancy in
appropriate form and shall be responsible for filing a copy of every
certificate with the Tax Assessor.
C.
Assessments and taxes.
(1)
When a permanent or temporary certificate of occupancy is issued
for a project granted exemption pursuant to the Act, the Tax Assessor
shall reflect the improvements and land thereof, as authorized, on
the exempt property list or as otherwise required by state statute.
Further, the Tax Assessor shall exempt the assessment of all improvements
covered by the financial agreement during the period the exemption
remains in effect. Assessments for land shall remain taxable throughout
the term of the exemption, except as otherwise provided.
(2)
At any time that the Tax Assessor causes the assessment on the improvements
or land of a project to be removed, in whole or in part, from taxable
to exempt status, he shall so notify the Tax Collector in writing
so as to insure the commencement and payment of annual service charges,
pursuant to the terms of the financial agreement.
D.
Collection and audit. Upon receipt of an executed financial agreement,
the Tax Assessor shall note within its books of account a record of
the execution of the agreement and the dates provided for commencement
and completion of construction. The Tax Collector shall thereafter
continue to levy taxes and collect payment thereof on the property
until the occurrence of the following:
(1)
In the event that a certificate of occupancy is issued for the project,
the Tax Collector shall immediately cease to levy or collect taxes
on the portion of the assessed value covered by the certificate of
occupancy and shall instead commence billing the entity the estimated
annual service charge (in lieu of taxes) as required by the financial
agreement. Where the financial agreement is authorized pursuant to
the Act, taxes on the value of the land shall continue to be levied
and collected according to the laws of New Jersey. However, if the
Township has granted an abatement on the property, as well as an exemption
for the project, taxes due on land upon which the project has been
constructed shall reflect the amount of such abatement.
(a)
When a certificate of occupancy for a project is issued, in
addition to the steps outlined above, the entity shall submit to the
Chief Financial Officer, Tax Collector and the Tax Assessor a copy
of a certified total project cost audit prepared by a certified public
accountant and the independent and qualified architect's certification
required by the Act, within 90 days from the date of issuance of the
certificate of occupancy.
(b)
The Tax Assessor shall review the certified total project cost
audit and the architect's certification and make a determination
as to the acceptability of the audit. If the audit is deemed unacceptable,
it may be performed by the Township's designated auditor, and
the cost thereof shall be borne by the entity. The Tax Assessor shall
be responsible for billing the entity for the cost of the audit. Once
the audit is accepted, if its findings cause any change in the basis
to be used in the determination of the annual service charge, net
profit or excess profits, the Tax Assessor shall bill the entity for
any adjustment. The Tax Assessor shall also maintain a copy of an
approved certified total project cost audit with the permanent files
of its office.
(c)
Upon adoption of an ordinance authorizing amendment to the financial
agreement, the Tax Assessor shall bill the entity for the cost of
the audit services and for any additional service charges resulting
from an adjustment of the estimated service charges, and thereafter
annual service charges or excess profits, if owed, shall be billed
to the entity. The Township Clerk shall be responsible for distributing
and filing executed copies of the financial agreement, as amended,
in the same manner as set forth for in the financial agreement.
(2)
In the event that the entity fails to commence or complete construction
of the project within the time required by the financial agreement,
fails to make payment of annual service charges (in lieu of taxes)
as required by the agreement, or otherwise fails to satisfy a material
condition of the agreement, the Tax Assessor shall notify the Township
Solicitor of the default by the entity. The Township Solicitor shall
thereupon take steps necessary to terminate the financial agreement
and to advise the Tax Assessor and the Tax Collector of the actions
to be taken regarding the assessment and collection of real estate
taxes. The Township Solicitor shall also be responsible for the preparation
of such ordinance necessary to authorize the termination of the financial
agreement. Upon adoption of such an ordinance, the Township Clerk
shall be responsible for filing and distributing the ordinance in
accordance with the procedures established in the financial agreement
and shall provide a copy of the ordinance to the Director of the Division
of Local Government Services.
Upon completion of the construction project and the issuance
of a permanent certificate of occupancy, the entity shall continue
to operate the project according to the terms of the financial agreement
until the agreement terminates or expires. The Tax Assessor shall
be responsible for the oversight and administration of the financial
agreement during the term of the agreement, in accordance with the
procedures set forth as follows:
A.
Billing and payment.
(1)
During the term of the agreement, the Tax Collector shall bill quarterly
service charges to the entity. The bills shall reflect the taxes due
on the value of all land included within the project and all service
charges (in lieu of taxes) or other fees or charges due on the improvements
as required by the agreement. If authorized by law, the land upon
which housing is constructed, acquired or rehabilitated by an entity
may be exempt from taxation during the term of the financial agreement.
Irrespective of the date of issuance, any bill for annual service
charges or other municipal charges shall be deemed to have been issued
on the first day of each calendar quarter and to be due and payable
within 30 calendar days thereafter. Where annual service charges are
billed on the basis of estimated or projected figures, any payments
thereof shall be reconciled upon the submission of a certified audit.
In such instance, the entity shall make any additional or required
payments within 90 days after the close of its fiscal year. Any additional
payment by an entity shall be submitted along with a statement by
a certified public accountant, attesting that the additional payment
was the actual amount due based upon the gross revenue or total project
cost as computed in accordance with provisions of the Act and the
financial agreement.
(2)
All payments due to the Township arising out of the financial agreement
which are not paid as of the date due shall be subject to the same
charges for penalties and interest as arrears then in effect for nonpayment
of real estate taxes.
(3)
The Tax Collector shall accept all payments made pursuant to an effective
and valid financial agreement and shall maintain books of account
as to each agreement. Except as otherwise required by law, the Tax
Collector shall apply payments received for real estate taxes in the
following order: first, amounts due for penalties and interest on
taxes, and then amounts due for the principal of tax payments. As
to payments received for service charges, first, amounts due for penalties
and interest, and then amounts due for the principal of service charge
payments (in lieu of taxes). The entity shall be responsible for making
timely payments for real estate taxes and service charges directly
to the Tax Collector.
(4)
In addition to payment of the annual service charge (in lieu of taxes),
an entity shall be required to pay an annual administrative fee to
the Township. The requirement to pay an annual administrative fee
shall be included as a covenant in all deeds to a purchaser or transferee
of a project or unit owner thereof. The annual administrative fee
shall be 2% of the annual service charge payable and due on or before
February 1 of each year. In the event an entity or owner of a property
granted exemption pursuant to the Act does not pay the annual administrative
fee, such delinquency shall be grounds for rescission or termination
of the exemption.
B.
Annual audits.
(1)
Where required by law or the financial agreement, an entity shall
submit a certified audit prepared by a certified public accountant
of the financial performance of the project. A certified audit shall
be submitted each year within 90 days after the end of the fiscal
year of the entity to the Township Tax Assessor, with a simultaneous
copy to the Township Clerk for archival purposes. As part of or in
addition to the submission of a certified audit, the entity shall
submit a statement prepared by a certified public accountant attesting
to the net profits and the percentage of excess profits utilized to
maintain reserves authorized pursuant to the provisions of the Act.
The Tax Assessor shall review each audit upon submission and make
a determination as to any adjustment required in the annual service
charge (in lieu of taxes), net profit and/or excess profits.
(2)
The certified audit shall be submitted to the Chief Financial Officer for review. If the Chief Financial Officer determines that an audit is acceptable, it shall be used as the basis for the adjustments of any taxes, charges or fees outlined in Subsection A of this section. If it is determined that a certified audit is not acceptable, the Tax Assessor shall notify the entity, and the entity shall have responsibility to cure the deficiencies identified and to submit a corrected or restated audit. As part of the audit process, in the event that the certified audit is determined to be unacceptable, the entity shall have responsibility for the payment of a fee to offset the Township's cost for review of the certified audit. This fee shall be billed by the Tax Collector as part of the annual service charge and shall be payable under the same terms as that charge.
C.
Noncompliance. If an entity fails to comply with the requirements
for submission of a certified audit and/or timely payment of real
estate taxes and service charges during the term of the financial
agreement, the Tax Assessor shall have the responsibility to enforce
the terms of the financial agreement through the following procedure.
Such procedure shall not be the Township's sole remedy, but rather
shall be used in addition to such other remedies as may be provided
by the law and the terms of the financial agreement.
(1)
In the case where any payment due to the Township pursuant to a financial
agreement, whether arising from real estate taxes or service charges
(in lieu of taxes), is in arrears for a period of six months or more,
the Tax Assessor shall notify the entity that unless the total amount
due, including penalties and interest, and subsequent charges are
brought to current status within a period of 30 days from the date
of the notification, the exemption and financial agreement shall be
rescinded. If the entity fails to comply with such notice, the Tax
Assessor shall recommend that the Township Solicitor prepare an ordinance
rescinding the exemption and financial agreement and shall notify
the Tax Assessor of the pending action. Where an exemption and financial
agreement is rescinded, the entity shall have 30 calendar days to
seek reinstatement of the exemption and financial agreement, which
shall only be permitted when all obligations of the entity or person
receiving the benefit of an exemption are satisfied and made current.
Upon satisfaction of all obligations, the Tax Assessor shall recommend
that the Township Solicitor prepare an ordinance to reinstate the
exemption and financial agreement for the remainder of its term. It
shall be the responsibility of the Township Clerk to file and distribute
copies of all ordinances to rescind or reinstate an exemption and
financial agreement.
(2)
In the event of any nonpayment as outlined in Subsection C(1) of this section, in addition to the remedies outlined therein, the entity, by signing the financial agreement, agrees that the Township shall have the same rights to enforce liens and commence foreclosure proceedings against its project as though the nonpayment were real estate taxes. The Township may exercise such rights by following the procedures established by state statute and local ordinances for the collection of delinquent real estate taxes.
(3)
Where any certified audit required to be submitted pursuant to a financial agreement is delinquent for a period of three months or more from the date required to be submitted, the Tax Assessor shall notify the entity that unless the audit is submitted in proper form within 30 days from the date of notification, the exemption and financial agreement shall be rescinded. If the entity fails to comply with the notice, the Tax Assessor shall recommend that the Township Solicitor prepare an ordinance rescinding the exemption and financial agreement, which shall cause the project or unit thereof to be assessed according to the general laws of taxation. Where an exemption or financial agreement is rescinded, the remaining procedure shall be the same as set forth in Subsection C(1) of this section. However, the Township, at its option, may choose not to exercise its right to rescind or terminate, but instead cause an equivalent audit to be conducted by qualified personnel under the Township's direction. Where this option is elected, the Township shall utilize the resulting audit as the basis for billing as if it had been submitted by the entity. Further, the Township shall have the right to bill the entity for the cost of conducting an audit. Exercise of this option by the Township shall not in any way preclude or waive the right of the Township to terminate an exemption for any other default.
(4)
Where an entity or other person fails to comply with any other material
condition of a financial agreement, the Tax Assessor shall notify
the Township Solicitor of the default. The Township Solicitor shall
thereupon take appropriate steps necessary to declare the exemption
and financial agreement void or other such remedies as may be provided
by law, regulation or the terms of the financial agreement.
Notwithstanding anything to the contrary, an exemption shall
be granted for the following projects:
A.
Construction or development of a residential project consisting of
five or more units and not exceeding a period of 15 years;
B.
Construction or development of an industrial project not to exceed
a period of 15 years; and
C.
Construction or development of a commercial project not to exceed
a period of 15 years.
During the term of an exemption, in lieu of any taxes to be
paid on the project improvements, buildings or land, as authorized
by law, an entity shall make payment to the Township of an annual
service charge. The annual service charge required to be paid by the
entity shall be in accordance with the following:
A.
The annual service charge for low- and moderate-income housing projects
shall not be greater than 15% of the annual gross revenues generated
from the operation of such projects.
B.
The minimum annual service charge for all other housing projects
shall not be less than 15% of the annual gross revenues generated
from the operation of such projects, and the duration of the tax abatement
shall not exceed 30 years.
C.
The minimum annual service charge for commercial and industrial projects
shall not be less than 15% of the annual gross revenues generated
from the operation of such projects, and the duration of the tax abatement
shall not exceed 15 years.
D.
Where annual gross revenues cannot be reasonably determined because
of the nature of the development, ownership, use or occupancy of a
project, the annual service charge may be calculated on the basis
of the total project cost or total project unit cost. However, the
annual service charge for low- and moderate-income housing projects
shall not be greater than 2% of the total project cost or total project
unit cost. For all other housing projects, the annual service charge
shall not be less than two 2% of total project costs or total project
unit costs, and the maximum term shall not exceed 30 years. For industrial
and commercial projects, the annual service charge shall not be less
than 2% of total project costs or total project unit costs, and the
maximum term shall not exceed 15 years.
E.
The annual service charge for condominium projects shall be not less
than 10% of the annual gross revenues generated from the operation
of such projects, and the maximum term shall not exceed 30 years.
In the case of a condominium project, "annual gross revenue" means
the amount equal to the annual aggregate constant payments to principal
and interest, pursuant to N.J.S.A. 40A:20-14(a).
