RED BANK: TAX BREAK CLOUDS SAXUM HEARING

Saxum’s project would replace the former Visiting Nurse Association headquarters at 176 Riverside Avenue. (Photo by John T. Ward. Click to enlarge)

By JOHN T. WARD

hot topic red bank njRed Bank’s planning board kicked off a process Monday night that could result in a rezoning of prime real estate.

But while the ultimate goal of the effort – a tax break for a developer – was not under immediate consideration, it was clearly on the minds of objectors, including at least one board member.

Outline indicates the properties under consideration for “area in need of redevelopment” designation. Below, board member Fred Stone at Monday’s meeting. (Photo below by John T. Ward. Click to enlarge)

At issue is a possible zone reclassification for a cluster of properties at the borough’s northernmost tip, including the former Visiting Nurse Association headquarters, at Riverside Avenue and Bodman Place.

Saxum Real Estate holds a December, 2019 board approval to build 210 apartments there, including 32 units reserved for low- and moderate-income earners.

The “study area” also includes two, long-vacant gas stations near the Route 35 Cooper’s Bridge; a borough sewage facility; a tenanted office building on the Navesink River; and several vacant lots.

Saxum wants its zoning designation changed to an “area in need of redevelopment” under state law, from an “area in need of rehabilitation.” That would make the 3.2-acre site eligible for tax relief in the form of a payment in lieu of taxes, or PILOT, if it can negotiate such an agreement with the borough council.

PILOTs generally call for tax exemptions for a specified period, up to 30 years, on site improvements. Instead, beneficiaries make specified “in lieu of” payments that, unlike standard levies, the town would not have to share with school districts.

Saxum needs the change “in order to make the project economically viable” in the face of increased construction costs, redevelopment consultant Ken DeRoberts said last month.

At Monday’s meeting, Chris Dochney, an engineer with CME Associates, laid out the highlights of a study commissioned by the council that he had authored as an initial step toward a possible change.

Dochney said he found that the VNA site and adjoining parcels met the criteria for the contemplated redesignation. So did the two gas stations, he said.

The Coastal Building office structure did not meet the criteria, he said.

Here’s the CME report., whose cost was to be borne by Saxum.

Board chairman Dan Mancuso and board attorney Marc Leckstein repeatedly told the audience of about two dozen that taxes were not the purview of the planning board, and concerns about them should be addressed to the council.

What the borough council might do with the board’s finding “is completely irrelevant to this board’s decision tonight,” said Leckstein. The board’s charge, he said, is to determine “if the proper criteria have been met” to allow for a redesignation.

But the tax issue turned out to be an elephant that repeatedly made its presence known in the council chamber, where the board was holding its second in-person session since the start of the COVID-19 pandemic.

Board member Fred Stone announced that he needed “a moment to vent my frustration over this process.”

“We all know what this permits to happen down the road,” said Stone, who’s also president of the borough board of education. “I can’t argue with the criteria, but I do have to express that this is not in the best interest, particularly of the schools of the borough, eventually losing out on the proceeds of the tax revenues of a huge new ratable.”

Mary-Ellen Mess, of Hudson Avenue, used part of her five minutes at the mic to get Dochney to restate that he was “not expecting” to be asked to re-study the area for redevelopment potential less than two years after Saxum had obtained its approval based on a “rehabilitation” designation. Dochney said that was the case.

When Mess asked Dochney, “what is the benefit to the town” of a change, Leckstein interrupted. “That’s a question for the council,” he said.

“We’re here because people let developers run down their properties,” said Cedar Avenue resident Sue Viscomi. She too, was cut off by Leckstein when she turned to the issue of taxes.

“It’s just bad that it’s on the backbones of taxpayers,” she said.

Irving Place resident Dan Riordan said the board, if it approves the redesignation, will effectively “reward” owners who allow their properties to become dilapidated, “which is to their advantage” when it comes to seeking PILOTs.

Mancuso adjourned the Saxum hearing after two hours, with more residents waiting to be heard. It’s scheduled to resume September 22.

No one representing Saxum spoke at the meeting, and it was unknown if anyone in the audience of about two dozen was present on its behalf.

In response to questions by Mayor Pasquale Menna, Leckstein said the 2017 approval for a six-story Hampton Inn on the Exxon site was “still valid,” even though the planning board had rejected a requested extension by site owner RB Capital in August, 2019.

In his report, Dochney noted that RB Capital principal Larry Cohen had since died, and his mother, a mortgage holder, was “working on settling the debts and potentially selling the property.”

In his testimony, Dochney said the site was scheduled for a Monmouth County Sheriff’s sale earlier in the day, and he did not know if it had a new owner as a result.