Tax Abatement Attorney in Jersey City, NJ

New Jersey statutes dictate the availability of tax abatements for development projects throughout the state.

However, local municipalities still retain a great deal control over the application and approval process. In light of this substantial local discretion, it is advisable to work with a legal team that understands the unique requirements of each municipalities’ local ordinance and the related impacts a tax abatement may have on your project. 

With an office in Jersey City, Scarinci Hollenbeck’s attorneys have local insight into the City’s tax abatement process, which is one of the most complex in the state. Jersey City’s tax abatement process involves the Long-Term Tax Exemption Law, the Five-Year Tax Exemption Law, as well as local ordinances including the Five- Year Tax Exemption Ordinance.  Under local ordinances, tax abatements may trigger a requirement to enter into a Construction Project Labor Agreement and/or require payments to the Long-Term Tax Exemptions Affordable Housing Trust Fund.  A thorough understanding of these requirements is essential to evaluating and maximizing the true economic value of an abatement.

Under Jersey City’s local tax abatement ordinance, developers of projects with a total project cost exceeding $25,000,000 must enter into Project Labor Agreement with the city, which outlines procedures to resolve labor disputes and mandates employment for Jersey City residents.  Developers receiving long-term tax abatements on projects valued at less than 25,000,000 are required to execute a Project Employment and Contracting Agreement (PECA), which establishes good faith goals for hiring Jersey City residents and awarding contracts to local businesses.

To encourage redevelopment in parts of Jersey City where municipal officials believe it is most needed, the City has adopted a tiered long-term tax abatement program under which projects located in different “zones” are eligible for different incentives.  Under the policy, which Mayor Fulop enacted in 2013, developers building in Journal Square are eligible for a 30-year tax abatement, while projects in parts of the West Side, the Heights, and the southeastern waterfront can receive tax breaks for ten years. Each tier has both geographic and legal requirements.  There are also buy-up provisions that provide for longer terms in exchange for additional concessions.

Scarinci Hollenbeck’s skilled attorneys possess vast experience in the representation of owners and developers pursuing redevelopment projects in Jersey City. Our lawyers routinely help developers explore the availability of exemptions and abatements intended to limit or defer the burden of property tax. Once the application is filed, we also assist with the negotiation of the related abatement agreements to achieve the best result for our clients. Since failure to comply with the terms of a financial agreement, PICA or Employment Labor Agreement, or failure to make timely payments under a financial agreement can result in termination of the tax abatement, Scarinci Hollenbeck can also help ensure compliance during and after the project is completed.

Do you have questions about tax abatements? Please call 201-806-3364 for more information.