Twenty-four years of tax appeals over the could be resolved within six weeks, after the West Deptford township committee approved a pair of deals totaling $32.4 million Tuesday night in a 3-2, party-line vote to settle appeals with the two owners involved.
The decision played out much as it did last month, before with Sunoco , as Democrats Denice DiCarlo and Donna Szymborski called for more information and more negotiations on the deal, before being overridden by the Republican majority, which pushed for the deal ahead of another possible court date—this time, a state tax court hearing slated for June 4.
“I believe this settlement is a good alternative—a prudent alternative,” committeeman Sam Cianfarini said. “I will not jeopardize the people of West Deptford.”
The settlement with Sunoco, which covers eight years, actually represents a reduction from the original agreement, down to $13.9 million, while the Coastal/El Paso portion totals $18.5 million, and covers 16 years of appeals.
As Cianfarini pointed out in a rehash of , the settlements have the backing of the township’s professionals, and could save taxpayers millions, based on scenarios projecting the township’s tax liability up to $90 million.
Settling would avoid that worst-case scenario, Cianfarini said, and limit the hit to homeowners in the form of property tax increases, which he said would be limited to less than $100 per year, assuming a 1-percent increase in property values over the course of the bond funding the tax refunds.
And with the set to spin up its turbines and begin producing power in 2014, the increased Payments in Lieu of Taxes program from the power plant could zero out the hit from Eagle Point, Cianfarini said.
“That LS Power payment would pay for this entire settlement,” he said.
But DiCarlo raised long-term concerns both over the agreed value of the property set by the settlement—$100 million for the entire 1,180-acre complex, versus the $153.5 million assessment by the county—as well as the distribution of value over the property, which is split across about a dozen lots, plus the 225-megawatt cogeneration plant.
“I have yet to see one valuation opinion,” she said.
The $100 million assessment would cut Sunoco’s taxes on Eagle Point down to about $2.4 million, going by the current tax rate.
Township administrator Eric Campo said the settlement specifies values for each of the separate lots on the property, including a portion allotted to the power plant, which .
The $100 million assessment would be locked in through the end of 2013, but would revert to normal assessment after that, potentially opening up the property to more appeals a little more than a year and a half from now—coincidentally, .
But Cianfarini said it’s also possible the value of the property could increase, given possible plants for expansion at the site by Sunoco Logistics, the pipeline and storage arm of the company, which .
“They want to make more investment in that area,” Cianfarini said.
While the pieces are in place, the settlements are far from done, however. The deals will need to pass muster with the state Local Finance Board (LFB) next month, and the second reading of the bond ordinance to fund the $32.4 million will need to pass by a supermajority of the board—meaning at least one of the two Democrats who opposed the settlements will have to switch to a yes vote.
There’s some question about when that second reading of the bond ordinance will happen, as well. Campo said a date hinges on approval from the LFB, but could happen either at a special meeting at the end of May or one of the regular June meetings.
“We can’t set a date tonight,” Campo said.
Mayor Ray Chintall said he hopes something can be done to convince one of the Democrats to come on board and vote to approve the bond ordinance when it comes up for a second vote.
“There is still time to think about it,” he said.