Vernon Council passes redevelopment ordinance
VERNON — The much-debated ordinance to establish tax abatement status for redevelopment zone projects has been narrowly passed.
The ordinance was adopted 3-2 with Councilman Dan Kadish and Councilwoman Jean Murphy voting against it.
The ordinance outlines the eligibility for redevelopment projects in certain areas of the township to be eligible for a 30-year tax abatement. Such projects must still apply for and be granted approval by the Town Council.
Currently Crystal Springs Resort Chief Executive Officer Andy Mulvihill has recently been before the Township Council seeking a 30-year Payment In Lieu of Taxes agreement for the construction of an indoor water park and hotel at Mountain Creek.
“This is an enabling ordinance,” Attorney John Ursin said. “(The township) is doing this as a best practice. There is an application process and the council would have to approve each (project) separately.”
While the ordinance establishes eligibility for redevelopment tax abatement, it has been widely speculated that it is specific to the proposed Mountain Creek indoor water park and hotel project.
The water park project is seeking a 30-year tax abatment from Vernon Township to bridge a $28 million gap in funding. If completed, the water park is expected to generate $3.24 million in tax revenue, with Vernon Township collecting $1.29 million annually. The property currently brings in about $15,000 per year in property taxes.
Many have contested the 30-year term, stating that such a length of time as too long to limit Vernon’s ability to reassess property tax and leaves the town vulnerable in the event of the project’s failure; many citing the mostly empty Legends resort.
“I can’t support allowing a 30-year tax abatement with little benefit to the town with increased traffic, water usage and exclusive clientele.” Kadish said. “Bankers said that the project is too risky to underwrite without a municipal abatement and if it’s too risky for them, maybe it’s too risky for Vernon.”
“When you pay off a 30 year mortgage, at some point you’re paying more principal than interest and it should be the same with this,” Murphy said.
Despite their dissent, the three remaining council members voted in favor of adopting the ordinance, citing guaranteed tax revenue.
“I like the sound of $1.2 million over $15,000,” Council President Brian Lynch said.
“The size of this project is nothing this town has seen.” said Councilman Patrick Rizzuto, “Once online, you have a constant stream of taxes. The only way to maintain or reduce (property) taxes is through commercial growth.”