A proposal in Montclair that would have addressed the inequitable distribution of dollars from payment in lieu of taxes to the public schools doesn’t work as proposed. But the town council is considering other ways to help its cash-strapped school district, including in talks for a future PILOT agreement, officials said…
Options, How We Got Here
Marc Pfieffer, a senior policy fellow at Rutgers University’s Edward J. Bloustein School of Planning and Public Policy, said towns that share PILOT dollars with schools do it in ways that that support their local needs.
Woodbridge, Pfeiffer said, uses PILOT money to support the construction and maintenance of facilities that the town shares with the Board of Education. And other towns, he said, share PILOT revenues for residential projects likely to increase the school population.
The inequitable sharing, Pfeiffer said, has a long history that favors municipal governments. This is because when initially established by the legislature, PILOTs were only available to Urban Aid municipalities, which would typically correspond with the list of then Abbott districts, where the state covered greater portions of school costs.
In 1992, the Legislature extended PILOT availability to all towns, he said. “It is in the interest of municipalities to do development projects where they can because they get 95% of all the taxes that would otherwise be paid, which can go to increasing the municipal budget,” Pfeiffer said.