JERSEY CITY – The administration of Mayor Steven Fulop has drafted a new tax abatement policy for Jersey City that the mayor says will incentivize development in parts of the city where revitalization has been sluggish. The plan, the first of its kind for Jersey City, is designed to give the greatest tax incentives to developers who agree to develop in communities that saw little or no redevelopment during the city’s housing boom.
The plan must still be approved by the City Council.
The plan, according to the administration, will establish a tiered structure for abatements based on geography and income levels. Its purpose is to incentivize development in the inner city.
“This policy will make the use of tax abatements better for the residents, the City, and labor,” Fulop said. “Additionally, the developer will have clarity as the government will have a set policy in place with clear objectives.”
The city’s use of tax abatements to spur development has long been controversial. Initially used to attract development along Jersey City’s waterfront, the city’s tax abatement policy successfully revitalized parts of downtown that were once littered with rundown warehouses and vacant lots. But in recent years the city continued to hand out lucrative abatements to developers for downtown projects, even though the area was no longer in need of redevelopment.
“Until now, all the market rate development has been limited to downtown because of a lack of a policy,” said Mayor Fulop. “These one off deals have created a culture of artificial competition with parts of the city, abatements based on who you know, and no foresight for future development in those parts of the city where it is needed most.”
The administration’s plan includes six tiers and requires developers who receive abatements to adhere to a Project Labor Agreement and a Project Employment Agreement, as well as contribute to the city’s Affordable Housing Trust Fund. And, in another departure from the past, the new policy requires that affordable housing, in most cases, will be built in the same ward that generated the contribution.
“Our policy seeks to address this imbalance that has for years favored the waterfront and downtown,” said Mayor Fulop. “Long term tax abatements will be utilized to support and encourage development in other areas of the city, including but not limited to, Journal Square and Bergen Lafayette where there is substantial public transportation.”
The City Council is expected to consider the proposal on Wednesday, Aug. 28 at 6 p.m. at City Hall, 280 Grove St.
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