Washington Twp. to reconsider long-debated tax deal for project

A deal inked in 2008 for a "town center" project in Washington Township that has faced a series of delays will again come before Township Council Wednesday. And if the governing body again rejects the tax agreement for the plan, the township business administrator warned, there could be "mayhem."

The 35-acre Washington Square redevelopment project calls for 330 rental apartment units, 100 for-sale townhomes, and about 170,000 square feet of retail and office space. It was last derailed in July 2013, when a majority of the five-member council voted against a payment-in-lieu-of-taxes (PILOT) agreement for the site – a swath of mostly open land on Hurffville-Cross Keys Road, near Fries Mill Road.

The redeveloper – Washington Square Urban Renewal – sued the town soon after, claiming in part that the municipality failed to live up to its 2008 redevelopment agreement and also challenging the municipality's affordable housing obligations.

Part of the agreement said that the redeveloper "may require a payment in lieu of taxation or a tax abatement" in order to make the project feasible, said Township Business Administrator Robert Smith.

In the year since, Washington Township has spent about $150,000 in connection with the lawsuit, Smith said. It has hired an economics expert to advise the municipality and consulted with its attorneys, all coming to one conclusion: "A judge would absolutely grant a PILOT to the redeveloper," Smith said Tuesday.

The actions by council Wednesday would affirm or thwart the planned settlement. The proposed PILOT now allows the township's share of the project's gross revenues to be 12 percent. Last year's proposal called for the township to collect 10 percent. The townhomes are also now included in the calculations.

But one day before the vote, some council members expressed dismay at the lack of specifics provided.

"Hours before we're supposed to vote on it, we still haven't received the paperwork," Council President Giancarlo D'Orazio, a Republican, said Tuesday. Last year, he voted against the tax agreement. "In my opinion, this is the biggest vote I'm going to exercise in my four years."

Council members were provided Friday with a copy of the new financial agreement, but key elements -- namely the amount expected to be collected under the PILOT -- were not included. Two weeks ago, they were informed of the nearing settlement during a closed session.

Councilman Daniel Morley, a Republican who has long supported the project as a means to "kick start" new development in town, called the process "disconcerting." Morley said council was no longer considering the PILOT on its own terms, but under pressure to approve the settlement -- or face costly legal ramifications.

Though he was unable to provide the actual projected collections during a phone interview Tuesday, Smith said the PILOT, over 30 years, would generate $47 million more for the township than if the project was built and taxed regularly. He said a finalized agreement would be provided to council members before the meeting Wednesday night.

Proponents of the project in the past have pointed to the prospect of new jobs and added revenue for the township's coffers. Democratic Councilwoman Michelle Martin, along with Morley, voted in favor of the agreement last year.

But they were defeated by the votes of D'Orazio, Democratic Council Vice President Scott Newman and Republican Councilman Chris Del Borrello. Democratic Mayor Barbara Wallace also raised issues with the PILOT.

Opposition in part came from officials who were not convinced the redeveloper demonstrated the need for a PILOT. Another concern centered on the effect added families would have on the school district, which is not a beneficiary of PILOT revenue.

Smith said officials estimate the apartments and townhomes would add 60 to 70 children between all grades, noting that he has confidence that council would "negotiate in good faith with the school board" to compensate the district for additional students.

Challenges, it appears, may have little result.

"Truthfully," Smith said, "there is nothing that this current council or mayor can do can do to change those original terms."