RB Mayor: Tax Exempt Nonprofits Should Make Payments to Borough

January 13, 2012
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RED BANK — Mayor Pasquale Menna plans to lobby state legislators in search of some relief for taxpayers who are carrying more than their fair share of the cost of municipal services due to the large number of tax exempt properties in the borough.

Speaking at the borough’s annual reorganization meeting last Sunday, Menna told the large audience in attendance that “The time has come for the legislators to bite the bullet and give relief to our residents.”

About 16 percent of properties in the borough are owned by not-for-profits and are tax exempt. Red Bank has the second highest number of tax exempt properties in Monmouth County, right behind Asbury Park.

Menna’s concern over the number of tax exempt properties has been echoed in the past by Borough Councilman Michael R. DuPont, who chairs the borough’s finance committee.

Tax exempt properties in the borough translate to net annual loss of about $1.2 million in property taxes.

While Asbury Park may have more such properties, Menna explained, as a city with a large underprivileged population, it receives additional state and federal funding for assistance. Another community, Tinton Falls, has a fair amount, too, but much of it is county owned, and it gets some additional aid from the county via a payment in lieu of taxes, or PILOT.

That large number of nonprofit organizations attracts people to the borough to utilize the services they provide, which the mayor stressed, placing additional burdens on government resources and the community’s infrastructure, and those costs are being foisted on to residential and commercial property owners.

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There are three not for profits that do provide PILOTs: Riverview Medical Center, which contributes about $200,000 annually, the Navesink Rowing Club (which, actually doesn’t even own property) and the Monmouth Boat Club, according to Menna and DuPont.

Menna said that he would like to see legislators in Trenton review levy a PILOT on any nonprofits that acquire additional property in any town in which more than 15 or 20 percent of properties are tax exempt.

Any entering charitable organizations would pay a PILOT for its initial purchase as well as for any added lands. “That would give us some relief,” Menna argued.

The mayor conceded that state legislators from local districts have been cool to the idea and so far he has only received some interest from a legislator in Mercer County whom he declined to name. However, he plans to continue lobbying for the change in the coming months.

PILOTS have taken root and some universities have begun to offer their host communities PILOTs, DuPont explained. “The dialogue has to open up here,” on this issue, he said.

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