[HISTORY: Adopted by the Township Council of the Township of Monroe 5-26-2020 by Ord. No. O:13-2020. Amendments noted where applicable.]
Editor's Note: This ordinance also repealed former Ch. 252, Taxation, which consisted of Art I, Tax Exemption for Real Property Improvements, adopted 4-14-1998 by Ord. No. O-7-98, as amended; and Art. II, Hotel and Motel Room Occupancy Tax, adopted 8-22-2006 by Ord. No. O-30-2006.
All previous ordinances adopted by the Township of Monroe related to abatements and exemptions for properties located in areas in need of rehabilitation are superseded by this chapter.
The Township of Monroe may enter into agreements with applicants for tax abatement on residential, commercial and industrial projects which satisfy the chapter requirements hereinafter set forth. The agreement shall provide for an abatement from real property taxation on these projects for a period of not more than five years. During such five-year period, the agreement shall provide for payments to the Township of Monroe in lieu of full property taxes, which payment shall be calculated as set forth hereinafter in this chapter. Applications for abatement from taxation may be filed to take effect for the first full year commencing after the tax year in which the authorizing ordinance is adopted, and upon completion of the project for tax years thereafter as set forth in P.L. 1991, c. 441 (N.J.S.A. 40A:21-1 et seq.), but no application for tax abatement shall be filed for an abatement to take initial effect for the 11th full tax year or any tax year occurring thereafter unless this chapter is readopted by the governing body of the Township of Monroe.
The Township of Monroe shall grant exemptions from taxation of improvements to residential, single-family dwellings and residential portions of mixed-use dwellings more than 20 years old as permitted under N.J.S.A. 40A:21-1 et seq. In determining the value of real property, the Township shall regard the first $25,000 in the County Assessor's full and true value of improvements for each dwelling unit primarily and directly affected by the improvements as not increasing the value of the property for a period of five years, notwithstanding that the value of the property to which the improvements are made 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 dwelling through action of the elements sufficient to warrant a reduction.
Claims for the exemption shall be in writing upon forms prescribed by the Director of the Division of Taxation and must be filed with the local County Tax Assessor within 30 days, including Saturdays and Sundays, following completion of construction, improvements, conversion and/or conversion alteration.
The Township of Monroe may grant exemptions of some portion of the assessed valuation of construction of new dwellings, or of conversions of other buildings and structures to dwelling use, or both, may also provide for the abatement of some portion of the assessed value of the property receiving the exemption as it existed immediately prior to the construction or conversion alteration. An abatement for a dwelling may be granted for a total of up to five years, but the annual amount of the abatement shall not exceed 30% of the total cost of the construction or conversion alteration, and the total amount of abatements granted to any single property shall not exceed the total cost of the construction or conversion alteration. The abatement period and the annual percentage of the abatement to be granted shall be set forth in this ordinance, which may include a schedule providing for a different percentage of abatement, up to 30%, for each year of the abatement period.
There may be an exemption from taxation of improvements to multiple dwellings. In determining the value of the real property, the Township of Monroe shall regard the first $25,000 in the County 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 alteration 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 an abatement is granted pursuant to Subsection B of this section, or there is damage to the multiple dwelling through action of the elements sufficient to warrant a reduction.
An ordinance providing for exemption may also provide for the abatement of some portion of the assessed value of property receiving the exemption as it existed immediately prior to the improvement or conversion alteration. An abatement for a multiple dwelling may be granted with respect to that property for a total of up to five years, but the annual amount of the abatement shall not exceed 30% of the total cost of the improvement or conversion alteration, and the total amount of abatements granted to any single property shall not exceed the total cost of the improvement or conversion alteration. The abatement period and the annual percentage of the abatement to be granted shall be set forth in the ordinance, which may include a schedule providing for a different percentage of abatement, up to 30%, for each year of the abatement period.
To be considered for tax abatement a new commercial or industrial structure must contain a minimum of 5,000 square feet of floor space for use. An enlargement of an existing commercial or industrial structure must be more than 30% of the existing volume of the structure as defined in N.J.S.A. 40A:21-3g.
A preliminary application is required to be filed with the Township Clerk for the Law/Tax Abatement Committee prior to the issuance of a construction permit for the project for all commercial tax abatements and §§ 252-4 and 252-5 above. No construction permit shall be issued to an applicant seeking tax abatement until such time as the preliminary application has been filed in accordance with the Township ordinance requirements and the Construction Office advised of same in writing by the Township Tax Assessor. If a preliminary application is not filed, said property will not be eligible for tax abatement.
In the event a construction permit is not issued within one year from the date the preliminary application is filed, the preliminary application shall be deemed null and void.
Upon the filing of a preliminary application, the Law/Tax Abatement Committee will review said application to determine if it meets the requirements of the Township ordinance for abatement and a tax abatement agreement. The Law/Tax Abatement Committee shall provide this determination to the Township governing body within 60 days of receipt of a properly completed preliminary application. In the event the Law/Tax Abatement Committee determines that the application meets the chapter requirements, then the Township Council will consider an ordinance authorizing a tax abatement agreement with the applicant, subject to the following conditions:
That the applicant shall file a final application for tax abatement with the Township Clerk in the form prescribed, within 30 days, including Saturdays and Sundays, following completion of construction. A copy of the final application shall also be filed with the governing body of the Township.
The completed construction shall be in accordance with the original Township approvals on which the tax abatement agreement was initially authorized based on the preliminary application.
The applicant has continued to meet the requirements of the Township chapter for tax abatement. Every properly completed final application for abatement shall be evaluated for approval by Law/Tax Abatement Committee within 30 days of filing. The Law/Tax Abatement Committee shall notify the governing body in writing of the approval determination. Upon receipt of the written approval from the Law/Tax Abatement Committee the appropriate Township officials shall then proceed to execute the tax abatement agreement previously authorized by the specific ordinance adopted as part of the preliminary application approval process. The applicant shall be required to sign this tax abatement agreement prior to the Township signatories.
Separate applications must be filed for each building involved in phased projects.
In the event the use listed on the preliminary application is changed subsequent to the issuance of the construction permit for the project, the Township Council may adopt an ordinance authorizing a tax abatement with the applicant provided that the new use is of a type listed in § 252-9 as a qualifying project, that the applicant has submitted a revised preliminary application listing the new use, and that the Law/Tax Abatement Committee determines that the revised preliminary application meets the requirements of this chapter.
The preliminary and final application must be on a form prescribed by the Law/Tax Abatement Committee, and shall provide the following information:
A general description of this project for which abatement is sought;
A legal description of all real estate necessary for the project;
Plans and drawings including a site layout on the total lot area, 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, types of employees and average estimated wages and salaries by employee class, to be employed at the project site within two years of the completion of the project;
A statement of the reasons for seeking tax abatement on the project, and a description of the benefits to be realized by the applicant if tax abatement 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 tax abatement; and estimated tax payments that would be made by the applicant on the project during the first year following the termination of the tax abatement agreement;
A description of any lease agreements between the applicant and proposed users of the project, and a history and description of the user's business;
Proof of payment of taxes through the current quarter;
Other pertinent data regarding the relationship, agreements and status of other properties owned by the applicant within the Township of Monroe; and
Such other pertinent information as the governing body may require.
The following type projects/uses will be considered for tax abatement by the Township of Monroe:
Light industrial, light manufacturing, and indoor warehousing facilities which are nonpolluting and nonnoxious;
Scientific or industrial research engineering laboratory, testing or experimental laboratory or similar establishment for research or product development;
Experimental, research testing, dental or medical laboratories;
Carpet or rug cleaning: laundry and dry cleaning;
Job printing and newspaper or book publishing;
Baking and food and dairy processing;
Corporate and professional offices;
General service and repair shops, including carpenter, cabinet making, furniture repair, plumbing or similar shop;
Office of a builder, carpenter, caterer, cleaner, contractor, decorator, electrician, furrier, mason, painter, plumber, roofer, upholsterer, and similar nonnuisance businesses, excluding open storage of materials and excluding open storage of motor vehicles;
Veterinary hospital, provided that all animals are kept in a permanent enclosed structure and are not within 150 feet of any existing residential use or zone;
Businesses and instructional school, including trade school;
Nursing homes, homes for the aged and assisted living facilities;
General commercial establishments permitted by zoning;
Accessory uses on the same lot with and customarily incidental to any of the above permitted uses;
All tax abatement agreements must be authorized by a separate ordinance for each application.
A tax abatement agreement may provide for the applicant to pay to the Township in lieu of full property tax payments an amount annually to be computed by the following formula or other formula consistent with New Jersey law and acceptable to the Governing Body:
Tax phase-in basis: The applicant must pay to the Township 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 from date of completion, no payment in lieu of taxes unless otherwise due;
In the second tax year from date of completion, an amount not less than 20% of taxes otherwise due;
In the third tax year from date of completion, an amount not less than 40% of taxes otherwise due;
In the fourth tax year from date of completion, an amount not less than 60% of taxes otherwise due;
In the fifth tax year from date of completion, an amount not less than 80% of taxes otherwise due.
All tax agreements entered into by virtue of this chapter shall be in effect for no more than five full tax years from the date of completion of the project. Within 30 days of the execution of a tax abatement agreement, the Township shall forward a copy of said agreement to the Director of the Division of Local Government Services in the Department of Community Affairs.
No exemption or abatement shall be granted, or tax agreement entered into, with respect to any property for which property taxes or other municipal charges are delinquent or remain unpaid, or for which penalties for non-payment of taxes are due.
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, then the tax which would have otherwise been payable for each tax year shall become due and payable from the property owner as if no abatement had been granted. The Township governing body shall notify the property owner and the Tax Collector of the disqualification, and upon such notice, the Tax Collector shall within 15 days thereof notify the owner of the property of the taxes due and payable to the Township. With respect to the disposal of property, where it is determined that the new owner of the property will continue to use the property pursuant to the conditions which qualified the property for tax abatement, no tax shall be due, the abatement shall continue and the agreement shall remain in effect.
At termination of the tax abatement agreement, the property shall be subject to all applicable real property taxes as provided by law; but nothing herein shall prohibit a project, at the termination of an agreement, from qualifying for and receiving the full benefits of any other tax preferences provided by law.
As used in this chapter, the following definitions shall apply:
- The officer of the Township of Monroe 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 authority vested in the Commissioner of Environmental Protection.
- Substantially ready for the intended use for which a building or structure is constructed, improved or converted.
- The development of a 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.
- PHASED PROJECTS
- Commercial or industrial construction involving multiple structures that are built separately.
An application filing fee of $300 shall be paid by the applicant at the time of filing the preliminary application. The application fee will provide for the administrative services to be undertaken by the Law/Tax Abatement Committee, Township professionals and/or any other Township official, in order to render a determination on the applicant's eligibility for a tax abatement. The filing fee shall cover the cost for both the preliminary application and final application review and determination process.