Belleville Has 4 Active PILOT Agreements, Officials Say (2025 Update)

BELLEVILLE, NJ — Four. That’s the number of payment in lieu of tax (PILOT) agreements that are currently active in Belleville, officials say.

Mayor Michael Melham and finance officer Frank DiMaria spoke about PILOTs at this week’s town council meeting, with Melham later posting a social media update that mentions them.

PILOT agreements, also known as municipal tax abatements, are deals that enable a developer to switch their standard tax payments for a property to a fixed, yearly payment to the municipality. Some municipal officials have called them useful tools to attract development to distressed or blighted areas of town.

However, their use has also drawn criticism from opponents, some of whom say that the agreements can enable a big developer to skip out on paying their fair portion of property taxes, or divert tax money from local schools. Other experts say that revenue from PILOTs can fluctuate if they’re based on factors such as rent rolls, creating a “hit or miss” situation.

According to town officials, here are the four active PILOTs in Belleville (and their annual revenues):

“There’s always a lot of talk out in the public, especially on social media, about ‘all the projects… all the abatements,’” Melham said at Tuesday’s council meeting.

“If you listen to the chatter out on social media, you would think that we keep doling out these abatements to everybody that asks,” he added, repeating that there are “only four” active PILOTs in the township.

Belleville’s mayor has supported the use of PILOTs in the past.

Melham advocated for bringing new residential housing to the township that’s geared towards young professionals with higher disposable income during his state of the township speech in 2019.

“Once we get new mixed-use developments, we not only get the disposable income, but we get the windfall of rateables that come with it,” Melham said. “Those new ratables entering the township will certainly help offset and stabilize your taxes.” See Related: Belleville Mayor Gives 'State Of Town' Speech: Taxes, Free Pre-K

Last year, Melham mentioned PILOTs during his annual address, saying that “strategically utilized” agreements can yield big returns for the township. See Related: Watch Belleville Mayor’s 2024 State Of The Township Speech

TOWN OFFICIALS SPEAK ABOUT PILOTS

Several Belleville town administrators gave a presentation about PILOT agreements to the council last October (view it online here).

A post on the municipal website makes a case for their use. It reads:

“The Township of Belleville plans on redeveloping to attract new residents and businesses. This is a necessity as vacant or underutilized properties have become a burden on township services and resulted in years residential taxpayers supporting our tax burden. A thriving main thoroughfare can go a long way towards increasing revenue needed to run the town, stabilizing taxes and maintaining the quality of life for all residents. Responsible redevelopment takes into account the long and short-term impacts on municipal services and infrastructure including traffic and sewer usage. Policies are in place to ensure responsible redevelopment, such as requiring all redevelopers to submit to a financial impact analysis conducted by professionals retained by the township. As part of its ongoing effort to revitalize and redevelop Belleville, the township may offer PILOTs on qualified redevelopment projects as an incentive for developers to bring their projects to Belleville.”

Some additional arguments for the use of PILOTs presented on the website includes:

How do PILOTs affect my property tax burden? – “PILOTs help reduce the property tax burden on all of the township's taxpayers by generating new revenue that would otherwise not exist. First, the new development that takes place generates new sources of revenue from the day projects begin through fees associated with the development. Second, this new development helps increase property values by bringing people back and supports local businesses. While it is rare for property taxes to ever go down, the township has every expectation that development will stabilize taxes in the long‐term so that property owners will not see unexpected increases from one year to the next.”

How long will the township offer PILOTs? – “As development takes root and more projects are built, the township’s need to offer PILOTs will likely diminish as redevelopers and their banks will know what the marketplace can sustain based on rents and ‘comparables’ achieved by similar new projects. At that point, redevelopers and their banks will need fewer assurances once it is clear that projects can succeed in a revitalized area.”

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