[HISTORY: Adopted by the Board of Commissioners of the City of Ventnor City as indicated in article histories. Amendments noted where applicable.]
Article I Tax Exemption for Real Property Improvements and New Construction
§ 204-6 Exemptions for new construction of commercial structures, industrial structures and multiple dwellings.
[Adopted 12-18-2014 by Ord. No. 2014-33]
As used in this article, the following terms shall have the meanings indicated:
- That portion of the assessed value of a property as it existed prior to construction, improvement or conversion of a building or structure thereon, which is exempted for taxation pursuant to this article.
- ANNUAL PERIOD
- A duration of time comprising 365 days, or 366 days when the included month of February has 29 days, that commences on the date that an exemption or abatement for a project becomes effective pursuant to N.J.S.A. 40A:21-16.
- AREA IN NEED OF REHABILITATION
- The entirety of the City of Ventnor which has been determined to be an area in need of rehabilitation or redevelopment pursuant to the Local Redevelopment and Housing Law (P.L. 1992, c. 79) (N.J.S.A. 40A:12A-1 et seq.) by way of Resolution No. 107 of 2014.
- The Assessor of the City of Ventnor who is charged with the duty of assessing real property for the purpose of general taxation.
- COMMERCIAL OR INDUSTRIAL STRUCTURE
- A structure or part thereof used for the manufacturing, processing or assembling of material or manufactured products, or for research, office, industrial, commercial, retail, recreational, hotel or motel facilities, or warehousing purposes, or for any combination thereof, which the governing body determines will tend to maintain or provide gainful employment within the municipality, assist in the economic development of the municipality, maintain or increase the tax base of the municipality and maintain or diversify and expand commerce within the municipality. It shall not include any structure or part thereof used or to be used by any business relocated from another qualifying municipality unless: the total square footage of the floor area of the structure or part thereof used or to be used by the business at the new site together with the total square footage of the land used or to be used by the business at the new site exceeds the total square footage of that utilized by the business at its current site of operations by at least 10%; and the property that the business is relocating to has been the subject of a remedial action plan costing in excess of $250,000 performed pursuant to an administrative consent order entered into pursuant to the authority vested in the Commissioner of Environmental Protection under N.J.S.A 13:1D-1 et al, the Water Pollution Control Act, N.J.S.A. 58:10A-1 et seq., the Solid Waste Management Act, N.J.S.A. 13:1E-1 et seq., and the Spill Compensation and Control Act, N.J.S.A.58:10-23.1 1 et seq.
- Substantially ready for the intended use for which a building or structure is constructed, improved or converted.
- A property created or recorded as a condominium pursuant to the Condominium Act, P.L. 1969, c. 257 (N.J.S.A. 46:8B-1 et seq.)
- The provision of a new dwelling, multiple dwelling or commercial or industrial structure or the enlargement of the volume of an existing commercial or industrial structure by more than 30%, but shall not mean the conversion of an existing building or structure to another use.
- CONVERSION /CONVERSION ALTERATION
- The alteration or renovation of a nonresidential building or structure or hotel, motel, motor hotel or guesthouse in such manner as to convert the building or structure from its previous use to use as a dwelling or multiple dwelling.
- A housing corporation or association, wherein the holder of a share or membership interest thereof is entitled to possess and occupy for dwelling purposes a house, apartment or other unit of housing owned by the corporation or association or to purchase a unit of housing owned by the corporation or association.
- When used with respect to abatements for dwellings or multiple dwellings, only the cost or fair market value of direct labor and materials used in improving a multiple dwelling, or of converting another building or structure to a multiple dwelling, or of constructing a dwelling or of converting another building or structure to a dwelling, including any architectural, engineering and contractor's fees associated therewith, as the owner of the property shall cause to be certified to the governing body by an independent and qualified architect, following the completion of the project.
- A building or part of a building used, to be used or held for use as a home or residence, including accessory buildings located on the same premises, together with the land upon which such building or buildings are erected and which may be necessary for the fair enjoyment thereof, but shall not mean any building or part of a building, defined as a multiple dwelling pursuant to the Hotel and Multiple Dwelling Law, P.L. 1967, c. 76 (N.J.S.A. 55:13A-1 et seq.). A "dwelling" shall include, as they are separately conveyed to individual owners, individual residences within a cooperative, if purchased separately by the occupants thereof, and individual residences within a horizontal property regime or a condominium, but shall not include general common elements of such horizontal property regime or condominium as defined pursuant to the Horizontal Property Act, P.L. 1963, c. 168 (N.J.S.A. 46:8A-1 et seq.) or the Condominium Act, P.L. 1969, c. 257 (N.J.S.A. 46:8B-1 et seq.) or of a cooperative, if the residential units are owned separately.
- That portion of the assessor's full and true value of any improvement, conversion alteration or construction not regarded as increasing the taxable value of a property pursuant to this article.
- HORIZONTAL PROPERTY REGIME
- A property submitted to a horizontal property regime pursuant to the Horizontal Property Act, P.L. 1963, c. 168 (N.J.S.A. 46:8A-1 et seq.).
- A modernization, rehabilitation, renovation, alteration or repair which produces a physical change in an existing building or structure that improves the safety, sanitation, decency or attractiveness of the building or structure as a place for human habitation or work, and which does not change its permitted use. In the case of a multiple dwelling, it includes only improvements which affect common areas or elements, or three or more dwelling units within the multiple dwelling. In the case of a multiple dwelling or commercial or industrial structure, it shall not include ordinary painting, repairs and replacement of maintenance items, or an enlargement of the volume of an existing structure by more than 30%. In no case shall it include the repair of fire or other damage to a property for which payment of a claim was received by any person from an insurance company at any time during the three-year period immediately preceding the filing of an application pursuant to this article.
- MULTIPLE DWELLING
- A building or a structure meeting the definition of "multiple dwelling" set forth in the Hotel and Multiple Dwelling Law, P.L. 1967, c. 76 (N.J.S.A. 55:13A-1 et seq.), and means for the purpose of improvement or construction the general common elements and common elements of a condominium, a cooperative or a horizontal property regime.
- The construction, improvement or conversion of a structure in an area in need of rehabilitation that would qualify for an exemption, or an exemption and abatement pursuant to N.J.S.A. 40A:21-1 et seq.
The Commission hereby determines to utilize the authority granted under Article VIII, Section 1, Paragraph 6 of the New Jersey Constitution to establish the eligibility of residential dwellings, multiple dwellings, condominiums and cooperatives and the eligibility of commercial and industrial structures for exemptions and abatements permitted by P.L. 1991, c. 441 (see N.J.S.A. 40A:21-1 et seq.), throughout areas designated, or to be designated, as in need of rehabilitation.
This article authorizes the City of Ventnor to grant exemptions and abatements to commence and take effect in the 2015 tax year and thereafter.
There may be an exemption for a portion of the assessed valuation of construction of new dwellings and of conversions of other buildings and structures, including unutilized public buildings, to dwelling use. In determining the value of the real property, the City shall consider 30% of the Assessor's full value of the dwelling constructed, or conversion alterations made, as not increasing the value of the property for a total of five years, notwithstanding that the value of the property upon which the construction or conversion occurs is increased thereby. An application for exemption pursuant to this section shall be made to the governing body in the form set forth in § 204-7 of this article.
An exemption pursuant to this section shall be approved by the Assessor upon the filing of an application pursuant to § 204-14 of this article and thereafter shall be approved by City Commission. The above exemption shall not qualify for the payment in lieu of taxes pursuant to § 204-8 and shall be calculated as permitted by N.J.S.A. 40A:21-5c and shall allow a thirty-percent exemption of the new construction for a total of five years.
There shall be an exemption from taxation of improvements to commercial and industrial structures. In determining the value of the real property, the Borough shall regard 100% of the Assessor's full and true value of the improvements or conversion alterations as not increasing the value of the property for a total of five years, notwithstanding that the value of the property upon which the construction or conversion occurs is increased thereby. During the exemption period, the assessment on the property shall not be less than the assessment thereon existing immediately prior to the improvements, unless there is damage to the structure through action of the elements sufficient to warrant a reduction.
§ 204-6 Exemptions for new construction of commercial structures, industrial structures and multiple dwellings.
The governing body of the City of Ventnor is hereby authorized to enter into tax agreements for an exemption from taxation of new construction of commercial structures, industrial structures and multiple dwellings in accordance with the procedures set forth in §§ 204-7 through 204-13 of this article. In determining the value of the real property, the City shall consider 100% of the Assessor's full value of the construction as not increasing the value of the property for a total of five years, notwithstanding that the value of the property upon which the construction occurs is increased thereby. Exemptions pursuant to this section shall be subject to the payment provisions contained in § 204-8.
Applicants for tax exemption for a new construction of new residential dwellings, commercial structures, industrial structures and multiple dwellings pursuant to § 204-6 of this article shall provide the governing body of the City of Ventnor with an application pursuant to § 204-10 setting forth the following information:
A general description of a project for which exemption and abatement is sought.
A legal description of all real estate necessary for the project.
Plans, drawings and other documents as may be required by the governing body to demonstrate the structure and design of the project.
A description of the number, classes and type of employees to be employed at the project site within two years of completion of the project.
A statement of the reasons for seeking tax exemption and abatement on the project and a description of the benefits to be realized by the applicant if a tax agreement is granted.
Estimates of the cost of completing such project.
A statement showing the real property taxes currently being assessed at the project site; estimated tax payments that would be made annually by the applicant on the project during the period of the agreement; and estimated tax payments that would be made by the applicant on the project during the first full year following the termination of the tax agreement.
If the project is a commercial or industrial structure, a description of any lease agreement between the applicant and proposed users of the project and a history and description of the user's businesses.
If the project is a multiple dwelling, a description of the number and types of dwelling units to be provided, a description of the common elements or general common elements and a statement of the proposed initial rentals or sales prices of the dwelling units according to type and of any rental lease or resale restrictions to apply to the dwellings' units respecting low- or moderate-income housing.
Such other pertinent information as the governing body may require on a case-to-case basis.
[Added 3-19-2015 by Ord. No. 2015-06]
Following receipt of the application, the Tax Assessor shall review each application for completeness and prepare a tax estimate worksheet. A copy of the application and tax estimate worksheet shall be provided to the City's Business Administrator, Clerk, and Chief Financial Officer and the City Solicitor.
Within 60 days of receiving the filed application, the City Business Administrator shall forward a copy of the completed application and tax estimate worksheet to the governing body.
The governing body of the City of Ventnor may enter into a written agreement with an applicant for the exemption of local property taxes. The agreement shall provide for the applicant to pay the municipality in lieu of full property taxes, for all classes of property qualifying herein, an amount equal to a percentage of taxes otherwise due according to the following formula authorized by N.J.S.A. 40A:21-10:
Tax phase-in basis. The agreement may provide for the applicant to pay to the municipality in lieu of full property tax payments an amount equal to a percentage of taxes otherwise due, according to the following schedule:
In the first full tax year after completion, no payment in lieu of taxes otherwise due.
In the second tax year, an amount not less than 20% of taxes otherwise due.
In the third tax year, an amount not less than 40% of taxes otherwise due.
In the fourth tax year, an amount not less than 60% of taxes otherwise due.
In the fifth tax year, an amount not less than 80% of taxes otherwise due.
The Assessor shall determine on October 1 of the year following the date of the completion of an improvement, conversion or construction the true taxable value thereof. Except for projects subject to a tax agreement pursuant to § 204-8 of this article, the amount of the tax to be paid for the first full tax year following completion shall be based on the assessed valuation of the newly constructed property, minus the amount of the exemption, if any, allowed pursuant to this article, plus any portion of the property, i.e., land value not qualifying for the exemption.
All tax agreements entered into pursuant to this article shall be in effect for no more than the five full tax years next following the date of completion of the project.
As a condition to granting an exemption, a property owner shall be required to waive the filing of any tax appeal for the subject property for the life of the exemption/abatement.
The Clerk of the City of Ventnor, pursuant to N.J.S.A. 40A:21-11, shall forward a copy of all tax agreements entered into pursuant to this article to the Director of the Division of Local Government Services in the Department of Community affairs within 30 days of the date of execution.
If, during any tax year prior to the termination of the tax agreement, the property owner ceases to operate, or disposes of the property, or fails to meet the conditions for qualifying for the abatement, the local property taxes due for all prior years, subject to abatement and for the current year, shall be payable as if no exemption has been granted. The Tax Collector of the City of Ventnor shall notify the property owner within 30 days of the date of disqualification of the amount of taxes due. In the event that the subject property has been transferred to a new owner, and it is determined that the new owner will continue to use the property pursuant to the qualifying conditions, no tax shall be due, the exemption shall continue and the agreement shall remain in effect.
The City of Ventnor hereby determines that an additional improvement, conversion or construction completed on a property already granted a previous exemption or abatement pursuant to this article during the period in which the previous exemption or abatement is in effect shall qualify for an additional exemption or abatement. The additional improvement, conversion or construction shall be considered as separate for purposes of calculating the exemption and abatement, except that the assessed value of any previous improvement, conversion or construction shall be added to the assessed valuation as it was prior to that improvement, conversion or construction for the purpose of determining the assessed value of the property for which any additional abatement is to be subtracted.
No exemption or abatement shall be granted or tax agreement entered into pursuant to this article for any property for which property taxes and/or other municipal charges are delinquent or remain unpaid, or for which penalties for nonpayment of taxes are due. As a condition to granting an exemption or abatement, a property owner shall be required to waive the filing of any tax appeal for the subject property for the life of the exemption/abatement.
Every application submitted pursuant to this article shall be on a form prescribed by the Director of the Division of Taxation and shall be filed with the Tax Assessor of the City of Ventnor, as a condition to approval, within 30 days, including Saturdays and Sundays, following the completion of the improvements, conversion or construction.
At the termination of an agreement for tax abatement or exemption authorized pursuant to this article, the project shall be subject to all applicable real property taxes, as provided by state laws and regulations and local ordinances, provided that nothing herein shall be deemed to prohibit the project or improvement at the termination of the agreement for tax exemption or abatement from qualifying for and receiving the full benefits of any other tax preference provided by law.
This article shall take effect on final passage, approval and publication.