Requires cost-benefit analyses and local government financial impact findings for approval of long term property tax exemption; requires DCA to post Statewide database of these exemptions on its Internet website.

A1246

ASSEMBLY, No. 1246

STATE OF NEW JERSEY

222nd LEGISLATURE

�

PRE-FILED FOR INTRODUCTION IN THE 2026 SESSION

Sponsored by:

Assemblyman MICHAEL INGANAMORT

District 24 (Morris, Sussex and Warren)

Assemblywoman DAWN FANTASIA

District 24 (Morris, Sussex and Warren)

SYNOPSIS

���� Requires cost-benefit analyses and local government
financial impact findings for approval of long term property tax exemption;
requires DCA to post Statewide database of these exemptions on its Internet
website.

CURRENT VERSION OF TEXT

���� Introduced Pending Technical Review by Legislative
Counsel.

��

An Act

concerning long term property tax exemptions and
amending and supplementing P.L.1991, c.431.

����
Be It
Enacted
by the Senate and General Assembly of
the State of New Jersey:

���� 1.��� Section 8 of P.L.1991,
c.431 (C.40A:20-8) is amended to read as follows:

���� 8.��� Every urban renewal
entity qualifying under
[
this
act
]

P.L.1991,
c.431 (C.40A:20-1 et seq.)
, before proceeding with any projects, shall make
written application to the municipality for approval thereof.� The application
shall be in a form, and shall certify to those facts and data, as shall be
required by the municipality, and shall include but not be limited to:

���� a.���� A general statement of
the nature of the proposed project, that the undertaking conforms to all
applicable municipal ordinances, and that the project accords with the
redevelopment plan and master plan of the municipality, or, in the case of a
redevelopment relocation housing project, provides for the relocation of
residents displaced or to be displaced from a redevelopment area, or, in the
case of a low and moderate income housing project, the housing units are
restricted to occupation by low and moderate income households.

���� b.��� A description of the
proposed project outlining the area included and a description of each unit
thereof if the project is to be undertaken in units and setting forth
architectural and site plans as required.

���� c.���� A statement prepared by
a qualified architect or engineer of the estimated cost of the proposed project
in the detail required, including the estimated cost of each unit to be
undertaken.

���� d.��� The source, method
,

and amount of money to be subscribed through the investment of private capital,
setting forth the amount of stock or other securities to be issued therefor or
the extent of capital invested and the proprietary or ownership interest
obtained in consideration therefor.

���� e.���� A fiscal plan for the
project outlining a schedule of annual gross revenue, the estimated
expenditures for operation and maintenance, payments for interest, amortization
of debt and reserves, and payments to the municipality to be made pursuant to a
financial agreement to be entered into with the municipality.

���� f.���� A proposed financial
agreement conforming to the provisions of section 9 of
[
this act
]

P.L.1991,
c.431 (C.40A:20-9)
.

����
g.��� A cost-benefit
analysis of the project�s impact on the finances of the municipality, county,
and other taxing districts, within which the project is located, outlining, at
a minimum: (1) the net financial impact on the municipality based on the
estimated payments to the municipality to be made pursuant to a financial
agreement to be entered into with the municipality and the estimated additional
one-time and periodic expenditures to be incurred by the municipality as a
result of the project; (2) the municipal revenues to be gained or lost based on
this estimated net financial impact and the estimated net financial impact of
the property on the municipality if the project is not approved and the current
use and condition of the property is continued; (3) the property tax revenues
to be foregone by the county and taxing districts in which the project is
located if a tax exemption is approved pursuant to P.L.1991, c.431 (C.40A:20-1
et seq.); and (4) any other information relevant to determining the impact of the
project on the finances of the municipality, county, and other taxing
districts, within which the project is located, as shall be required by the
municipality or as may be required by administrative rules adopted by the Commissioner
of Community Affairs or the Local Finance Board.� Within 30 days of receipt of
the application, the municipality shall post the cost-benefit analysis required
by this subsection on its Internet website, or, if one does not exist, the cost-benefit
analysis shall be provided for public inspection on the Internet website of the
Department of Community Affairs.

���� The application shall be
addressed and submitted to the mayor or other chief executive officer of the
municipality.� The mayor or other chief executive officer shall, within 60 days
of his receipt of the application thereafter, submit the application with his
recommendations
, and an independent cost-benefit analysis of the project�s
impact on the finances of the municipality, county, and other taxing districts,
within which the project is located, conducted by the office, or other
designee, of the mayor or other chief executive officer,
to the municipal
governing body.�
The independent cost-benefit analysis shall include, at a
minimum, the information required in subsection g. of this section.� Within 30
days of submission to the municipal governing body, the municipality shall post
the independent cost-benefit analysis on its Internet website, or, if one does
not exist, the independent cost-benefit analysis shall be provided for public
inspection on the Internet website of the Department of Community Affairs.

���� The governing body shall by
resolution approve or disapprove the application, but in the event of
disapproval, changes may be suggested to secure approval.�
The resolution
shall include specific findings about the project�s estimated net impact on the
finances of the municipality, county, and other taxing districts, within which
the project is located.� Within 30 days of adoption of the resolution, the
municipality shall post the resolution on its Internet website, or, if one does
not exist, the resolution shall be provided for public inspection on the
Internet website of the Department of Community Affairs.
� An application
may be revised and resubmitted.

(cf: P.L.1991, c.431, s.8)

���� 2.��� (New section)� a.� A
municipality shall notify the Department of Community Affairs within 30 days
after approving a financial agreement pursuant to section 9 of P.L.1991, c.431
(C.40A:20-9).� The notice shall include the same information required to be
included in a plain language budget summary for long term tax exemptions
pursuant to subsection b. of section 39 of P.L.2007, c.63 (C.40A:5-48).

���� b.��� The Department of
Community Affairs, in consultation with the Office of Information Technology,
shall design, develop, and maintain a database on its Internet website that
contains and displays: (1) the information provided to the department pursuant
to subsection a. of this section, and (2) the information included in plain
language budget summaries for long term tax exemptions pursuant to subsection
b. of section 39 of P.L.2007, c.63 (C.40A:5-48), which were approved prior to
the effective date of P.L.� ��, c.��� (C.������� ) (pending before the
Legislature as this bill), sorted by municipality.

���� 3.��� This act shall take
effect immediately.

STATEMENT

���� This bill would require an
application for a long term property tax exemption to include a cost-benefit
analysis and for the mayor or other chief executive officer of the municipality
to produce an independent cost-benefit analysis to be submitted along with the
application to the municipal governing body before it can decide on the
exemption.� The bill would also require a municipal governing body to include
in its resolution approving or disapproving of a project for which a long term
tax exemption is sought specific findings about the net impact of the project
on the finances of the directly affected local governments, namely the
municipality, county, school district, and other taxing districts within which
the project is located.

���� The cost-benefit analyses and
financial impact findings required for grants of long term property tax
exemptions would have to be posted on the Internet website of the granting
municipality.� If the municipality does not have a website, this information
would have to be provided for public inspection on the Internet website of the
Department of Community Affairs (DCA).� Municipalities that grant new long term
property tax exemptions would have to provide pertinent information about each
approved project to DCA, which would post that information, along with existing
long term property tax exemption information retrieved from plain language
budget summaries submitted to DCA, in a database, sorted by municipality, on
its Internet website.

���� This bill would ensure that
municipalities consider and evaluate whether an investment in a redevelopment
project through the grant of a long term property tax exemption will generate
satisfactory revenue returns to the municipality, as well as the financial
impacts on counties, school districts, and other local governments.� The bill
would also allow the public to do the same by making the required cost-benefit
analyses and financial impact findings, as well as complete long term property
tax exemption information for each municipality, easily accessible on the
Internet.