Montclair Considering PILOT Agreement For MC Hotel

Montclair, NJ - The Montclair Township Council is considering offering a payment in lieu of taxes (PILOT) agreement to the developers of the MC Hotel, municipal administrators stated during a recent public meeting.

During the Township Council meeting on Dec. 1, municipal attorney Ira Karasick distributed details to council members about a potential PILOT agreement with the hotel’s owners.

NorthJersey.com reported the details of the potential PILOT agreement:

“The initial proposal states that the hotel will be responsible for annual payments of $642,000, roughly the same amount as property taxes would be based on the township’s assessment of the building, with a 2 percent increase each year… Along with a liquor license fee… the township could be receiving over $1 million annually from the hotel after 25 years.”

PILOT agreements, also known as tax abatements, are commonly used as an attempt to revitalize development in a “blighted area,” according to the NJ Office of the State Comptroller.

In a 2010 report, the state comptroller warns that PILOT agreements have a high potential for misuse and must be scrutinized to ensure the agreement is in the best interest of the local community.

See the full comptroller’s report here.

• See related article: It’s Official - The MC is Here to Stay
• See related article: Plans for the MC Hotel Move Forward in Montclair

Send Montclair news tips and press releases to eric.kiefer@patch.com