Vote On Gloucester Twp. Development Sparks Tax Incentive Debate

GLOUCESTER TOWNSHIP, NJ — A public hearing about a proposed tax abatement for the owner of Chews Landing LLC turned into a bigger debate about tax abatements throughout the township during Monday night’s council meeting.

Gloucester Township Council unanimously approved a proposed ordinance to execute a tax abatement with Cherry Hill-based Chews Landing LLC for the Chews Landing Commons on Chews Landing Road. The abatement would be phased in over five years.

Upgrades at the site have been finished, and most of the buildings in the office complex have tenants, according to Tax Assessor Chuck Palumbo. There are a total of six one-story buildings on the site, which is a joint venture between Needleman Management Company, Inc. and The Bannett Group, Ltd.

Five of the buildings are paying 100 percent taxes after initially being offered an abatement. There is room for one more building, but there are currently no plans to develop it, according to Palumbo.

During the public hearing before the final vote, a resident questioned why tax abatements are available for projects throughout the township, and what was to prevent a developer from building in a desirable area more than an area that actually needs it.

A tax abatement is a temporary reduction or elimination of property taxes. Municipalities use them to entice developers into their town, offering a complete elimination of taxes in the first year and slowly building so that the owner of the property is eventually paying full property taxes due.

The tax abatement program in New Jersey began in the early 1980s, and Gloucester Township was among the first municipalities to take advantage of it. Initially, abatements could be offered in blighted areas or areas in need of redevelopment.

In the early 1990s, the state deemed the term blighted to be too vague. The law was changed so that towns that wanted to offer tax abatements had to do so township-wide, making the entirety of Gloucester Township technically an area in need of redevelopment.

“If anyone can build anywhere in the township, what incentive is there for someone to build along Blackwood-Clementon Road as opposed to, say, the Gloucester Premium Outlets,” resident Denise Coyne asked.

Township officials told Coyne the state has to approve all tax abatements. Palumbo also said Blackwood-Clementon Road is one of the highest trafficked streets in the township.

“So that’s an incentive,” Palumbo said.

He also pointed to a number of projects along Blackwood-Clementon Road that have taken place, including Favorites, AutoZone, and the Cherrywood Plaza shopping center that includes Starbucks and SaladWorks, among other businesses. He also said the McDonald’s and Taco Bell across the street from Cherrywood Plaza are being upgraded.

“People don’t come to Gloucester Township to go to the McDonald’s,” resident Sam Sweet said. “They come to go to a place like the Lego store, for instance, and then they go spend their money at the McDonald’s while they’re there.”

The Gloucester Premium Outlets is an example of one destination property that brings in people from outside the township. The township offered a tax incentive to Simon to bring the outlet mall to the township, near Camden County College.

According to officials, the township was getting less than $5,000 a year for the 50 to 60 acres of land in that spot about five years ago.

“Now it’s bringing in more than $3 million a year,” Council President Orlando Mercado said. “And they will be paying 90 percent in taxes in 2020, and that’s the last year of their tax abatement.”

Four of the tenants and the senior center at the Chews Landing site are also paying 100 percent taxes after initially receiving an abatement.

Coyne asked if the economic development committee could look at ways to bring in businesses to the areas that need them the most in the township, and Mercado said council would ask them to explore that possibility.

Resident Pete Heinbaugh questioned the need for tax abatements at all, saying they put an additional burden on the taxpayers and that businesses would likely come to Gloucester Township without them.

While many businesses have come taken advantage of the tax abatement program, Royal Farms and Pep Boys both established businesses in the township without the benefit of a tax abatement, Palumbo said.

But officials said that other towns offer them, so Gloucester Township must also offer them in order to compete for business in the area.

According to thestate comptroller, Gloucester Township is one of three municipalities in Camden County that make “significant use of development abatements.” The other two are Collingswood and Camden. In South Jersey, Atlantic City, Bridgeton, Harrison Township, Millville and Vineland also make significant use of the abatement program.

“We’re a town of 65,000 people. We should already be able to attract business,” resident Ray Polidoro said. “We’re a town of working people, and with the economy as good as it is, there’s no reason we should have to bribe anyone to come here.”

He said businesses come in, but taxes continue to go up, and asked, “when will you bring in something that truly offsets the tax burden on our residents?”