§ 33-6. TAX AGREEMENTS FOR PROJECTS; PAYMENTS IN LIEU OF FULL PROPERTY TAX.
The Borough Council may enter into a written agreement with the applicant for the exemption of local real property taxes as to premises located within an area designated as in need of rehabilitation as defined pursuant to N.J.S.A. 40A:21-3. The agreement shall provide for the applicant to pay to the Borough, in lieu of full property tax payments, an amount annually to be computed by one (1), but in no case a combination, of the following formulas:
a.
Cost Basis. The applicant shall pay to the Borough of Sayreville, an amount annually equal to two (2%) percent of the cost of the project. For purposes of the agreement, "the cost of the project" shall mean the cost or fair market value of direct labor and all materials used in the construction, expansion or improvement of all buildings, structures and facilities at the project site, including the costs (if any) of land acquisition and land preparation, provision of access roads, utilities, drainage facilities and parking facilities, together with architectural, engineering, legal, surveying, testing and contractors' fees associated with the project, provided that the applicant shall cause such costs to be certified to the Borough by an independent and qualified architect following the completion of the project; or
b.
Gross Revenue Basis. The applicant shall pay to the Borough, an amount annually equal to fifteen (15%) percent of the annual gross revenues from the project. For the purposes of the agreement, "annual gross revenue" shall mean the total annual gross rental and other income payable to the owner of the project from the project. If, in any leasing, any real estate taxes or assessments on property included in the project, any premiums for fire or other insurance on or concerning property included in the project or any operating or maintenance expenses ordinarily paid by landlord are to be paid by the tenant, then such payments shall be computed and deemed to be part of the rent and shall be included in the annual gross revenue. The tax agreement shall establish the method of computing such revenues and may establish a method of arbitration by which either the landlord or tenant may dispute the amount of such payments so included in the annual gross revenue; or
c.
Tax Phase-In Basis. The applicant shall pay to the Borough of Sayreville an amount equal to a percentage of taxes otherwise due, according to the following schedule:
1.
In the first full calendar year after completion, no payment in lieu of taxes otherwise due.
2.
In the second calendar year, an amount not less than twenty (20%) percent of taxes otherwise due.
3.
In the third calendar year, an amount not less than forty (40%) percent of taxes otherwise due.
4.
In the fourth calendar year, an amount not less than sixty (60%) percent of taxes otherwise due.
5.
In the fifth calendar year, an amount not less than eighty (80%) percent of taxes otherwise due.
(Ord. #424-95, § 1)
(Ord. No. 126-10, § 1, 4-26-2010)