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Galloway PILOTs Require Transparency

The details of PILOT agreements between Galloway government and any non-profit organization should be made accessible to all citizens.

As the need for more revenue deepens, cash-strapped municipalities such as Galloway Township may increasingly continue to turn to colleges, such as Richard Stockton College, as well as other nonprofit groups, to request payments in lieu of the taxes (PILOT’s) on their property.

Private colleges and other nonprofit organizations, such as hospitals, churches, and soup kitchens, are exempt from paying property tax in all 50 states. The foregone revenue from the property-tax exemption may well total as much as $32-billion nationwide.

As municipal budgets are stretched thin, mayors and local politicians have called on their colleges and other such groups to compensate cities and counties for the services they use. Many of those agreements have appeared to be haphazard, secretive, and calculated in an ad hoc manner.

Moreover, payments in lieu of taxes have shown not to be structured as a reliable long-term source of funds. Municipalities and nonprofit groups should work collaboratively to negotiate plans for payments in lieu of taxes that are transparent, equitable, and predictable in providing the long-term stability that our community requires.


Any such plans should clearly articulate the methods for deciding which nonprofit groups will make payments in lieu of taxes. For example, PILOT amounts might be based on square footage to determine payments. Yet another alternative can be to factor in an organization's annual operating income.

To go even further, another example could be to  seek payments equal to 25 percent of the property taxes that would be owed if the nonprofits' real-estate holdings were fully taxable. Galloway municipal government and local nonprofits should work to hammer out payment plans that are transparent to the public and predictable so future budgets can be set.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

GallowayTwpNews February 01, 2013 at 05:06 PM
I have already reported same about Stockton Seaview Hotel's $300,000 contribution that will expire this year. http://www.gallowaytwpnews.com/2013/01/township-and-richard-stockton-college.html
Keep Galloway Green February 03, 2013 at 01:53 PM
So 25% is a fair amount?.......How about 100%?....How about if the residents only pay 25% of their taxes?...That sounds fair. To let Stockton get away with paying less/no taxes is disgusting. Why should every resident have to fund Stockton?....Residents already pay for schools.

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