Vonage PILOT: What It Could Mean for Holmdel Schools and Taxpayers

Tomorrow, Tuesday, December 9, 2025, the Holmdel Township Committee is scheduled to introduce Ordinance 2025‑30, which would approve a long‑term tax‑exemption and Payments in Lieu of Taxes (PILOT) agreements for the redevelopment of the former Vonage headquarters at 23 Main Street (Block 13, Lot 15). “Vonage Redevelopment” is also on the agenda for closed‑session discussion that night.

Right now, the Vonage property is taxed normally:

• It generates about $358,000 a year in conventional property taxes.
• Roughly $240,000 of that goes to the Holmdel school district.

Under a long‑term PILOT, the property would no longer pay regular school, municipal and county taxes. Instead, the developer would pay a negotiated annual “service charge,” of which Holmdel keeps 95%, 5% goes to Monmouth County, and the schools receive nothing unless a separate sharing agreement is created.

If the Vonage site moves into a PILOT without any revenue‑sharing, the district would lose roughly $240,000 per year it currently receives from that property, at the same time it is facing multimillion‑dollar budget gaps.

Schools: Deficits, Cuts and Contract Strain

Recent public figures show the school district under significant financial pressure:

• A September 2025 BOE candidate statement notes that Holmdel’s school budget is about $72 million, funded 69% by property taxes, and that the district faces a $2.5 million budget deficit.
• A financial review by Better Holmdel says the district warned of a $2.4 million deficit for 2026–27, and that updated projections put the structural gap in the $4–6 million range, depending on future costs and aid.
• Even after about $9 million in school‑tax increases over three years, the district is still looking at staff reductions and program cuts to balance its budget.

The district has warned that closing the gap could involve eliminating positions and considering outsourcing for paraprofessionals, secretaries and custodial staff—changes that have already prompted large turnouts at board meetings and visible concern from teachers and families.

Township Finances, PILOT Revenues and Rising Property Taxes

While the schools are talking about cuts, the municipal side has benefited heavily from existing PILOTs at Bell Works and Regency:

• From 2020–2024, Holmdel’s actual municipal revenue exceeded its own forecasts by nearly $24 million, much of it from PILOT payments.
• This allowed the Township Committee to increase annual spending by about $7.4 million (from $25.0M in 2020 to $32.4M in 2025) and grow its surplus from $3.5 million to about $8.2 million.
• Holmdel now receives around $7.5 million per year from existing Bell Works PILOTs alone, none of which goes directly to the school district under the current structure.

At the same time, residential property‑tax bills have been rising, and a large share of those taxes goes to schools:

• State data show Holmdel’s average residential property‑tax bill climbed from $12,866 in 2014 to $15,184 in 2024, an increase of about $2,300 (roughly 18%) over ten years.
• Because roughly two‑thirds (about 68%) of a typical Holmdel property‑tax bill funds the school district, increases in school spending are a major driver of overall tax growth.

Some residents worry that, if the school deficit is not addressed through other revenue sources, the district may eventually have to ask voters to approve a school‑tax increase through a referendum to maintain programs and staffing. That possibility is part of why PILOT‑revenue decisions at Vonage are drawing so much attention.

Community Views on Sharing PILOT Revenues

A recent Better Holmdel survey (145 respondents), summarized on Patch as “Holmdel Speaks: 94% Say PILOT Money Should Support Our Schools,” found:

• 94% of respondents said the Township should share some portion of PILOT revenue with the school district.
• About 63% favored giving the schools at least 40% of PILOT revenues; 77.3% supported at least 30%.
• 89% supported holding a public referendum to let voters decide whether and how much PILOT revenue should be dedicated to the schools.

In other words, among people who took the survey, there is strong informal support for sharing a substantial portion—on the order of 30–40% or more—of PILOT income with the district, and for deciding that question via a voter referendum.

Why the Vonage Decision Is a Focal Point

Putting these facts together:

• The Vonage property currently contributes roughly $240,000 per year to school funding under normal taxation.
• A PILOT at Vonage, without revenue‑sharing, would remove that school funding stream even as the district projects $2.4–6 million in deficits, discusses staff cuts and weighs how to avoid a future school‑tax referendum.
• Meanwhile, the township budget has grown stronger on the back of existing PILOTs, with higher municipal spending and an enlarged surplus, and many residents say they want a formal mechanism—potentially a referendum‑backed policy—to direct a substantial share (around 40%) of future PILOT revenues to the schools and reduce reliance on further property‑tax hikes.

We urge residents to sign this petition to stop the township from approving another PILOT that takes money away from the schools. Please sign this petition if you think that the township should first focus on a referendum and a subsequent significant share of PILOT revenues to the schools before approving additional PILOT programs in Holmdel. Have your voice heard by signing this petition.

Save Holmdel Schools

Prakash Santhana

Former Holmdel Deputy Mayor