LOOKING FOR A BREAK
Sen. Torricelli seeks 10-year tax abatement from Trenton for property that houses Subway
TRENTON » Former U.S. Sen. Bob Torricelli is asking Trenton to cut him a break on taxes for one of his properties in the capital city, which currently boasts a major tenant.
But one elected city official spoke out on Monday about giving Torricelli any tax abatement for his property at 101 S. Warren St.
“I’m really totally against these tax abatements,” South Ward Councilman George Muschal said. “We’ve got poor people who should have things before rich people have it. I know we’re trying to make the city a lot better than it is, but giving out freebies is not the way to do it.”
According to an application submitted by Torricelli’s company, Woodrose Properties Golden Swan Urban Renewal LLC, the former senator who served from 1997 until 2003 is seeking a 10-year tax abatement to transform the three-story building to market-rate housing upstairs and replace the heating and cooling system. The developer, who also owns the South Warren Street building across the street where the new Starbucks is located, is threatening to close down the building and end its leases if financial assistance is not provided.
Torricelli paid $44,733 in taxes for the property this year, a city official said Monday. If the tax abatement is approved by city council, the former Democratic senator looks to pony up a payment in lieu of taxes of $14,000 per year, netting an approximate saving of $300,000 over a decade. The savings could fluctuate as Torricelli would reimburse the city 10 percent of his revenue — projected close to $147,800 — from his rental units.
“The hope is to transform this historic building into more of a residential structure,” Torricelli said Monday night of the former Caola Building. “There’s simply too much vacant office space in downtown Trenton and not enough quality, marketrate housing. We’ll take the building and remove some of the offices and attempt to get more people on the streets and more people living downtown in marketrate housing.”
As part of the agreement, the former politician nicknamed “the Torch” has pledged to spend $230,500 on renovating the South Warren Street property. He purchased the property from the city in 2005 for $1, property records show.
The former senator is applying for the abatement under state statute.
“It’s not like a developer goes in and asks for an abatement,” Torricelli said. “This is available under the statute, and what it does is it takes your taxes to 10 percent of the revenues, which is kind of a standard tax rate in New Jersey, anyway.”
The developer has already renovated space in the building to fit a dental clinic at the property. The Subway will still remain a tenant.
“Otherwise, it becomes medical first floor and residential in the remainder of the building,” Torricelli said, noting the second and third floors will be fitted with one-to-two bedroom apartments. “It’s really aimed to young people.”
Despite being removed from office the past 14 years, Torricelli has remained a power player in the political world.
For Trenton Mayor Eric Jackson’s campaign in 2014, the former senator twice gave the first-time mayor the maximum allowable contribution of $2,600 for the regular and runoff elections. His company, Lambertville-based Woodrose Properties, also chipped in another $1,000 to Jackson’s campaign chest in March 2014, according to information on the New Jersey Election Law Enforcement Commission website.
Torricelli was embroiled in his own campaign finance controversy when he was senator, ultimately prompting him to not seek re-election.
Asked if he felt critics would point to the tax abatement as a form of payback, Torricelli responded, “I think having invested several million dollars in Trenton and started investing when few others would, I’m happy to take any scrutiny.” “I put my money where my mouth is and invested in a struggling city, and I think we’ve made a real difference, as evidenced by the opening of Starbucks today ... which also had a 10-year abatement,” the former senator said. “When the abatement ran out, now it’s paying full taxes.”
Torricelli said his property at 39 W. State St., where PNC is located, also had a 10-year abatement.
“Between our parking structures, and our office buildings and commercial
facilities, I’m very proud of the taxes we pay in Trenton and I think it’s at least our fair share,” Torricelli said.
However, Trenton Councilman Muschal does not see it that way.
“Torricelli should have enough money,” said Muschal, who claims the senator’s “name carries weight but also the name’s been tarnished.” “Once you’re in these projects, you don’t start a project unless you have money to back it, and I’m a firm believer in that. After a while, you got a city that’s paying no taxes. No revenue is coming into the city if everything is a freebie.”
Not all council members were as strongly as opposed to the tax abatement as Muschal.
“I need time for (Trenton Business Administrator Terry) McEwen to give us an explanation as to the tax abatement and how many other businesses have tax abatements and what it’s doing to spur the economic development downtown, because that’s really important,” said North Ward Councilwoman Marge Caldwell-Wilson, who received a $250 campaign contribution from Torricelli
in 2014. “We just need to have a discussion at council about it. We have a lot of tax abatements in the city of Trenton, it’s not just him.”
None of the other council members returned messages seeking comment. City council will vote Thursday on introducing the ordinance. If approved, a second reading will follow at council’s next meeting to finalize the tax abatement.
Trenton spokesman Michael Walker also did not return a message seeking comment.
As an earlier investor in Trenton, Torricelli said “a lot of the Christie years were wasted” but he thinks “it’s been a bipartisan neglect.”
“I think we’ve got an opportunity, but this is far from certain,” the former senator said of Trenton’s future. “The main thing we need is for the light rail system to be run down State Street to revitalize that business district.”
Torricelli also criticized Gov. Chris Christie’s proposal to tear down the state’s Health and Agriculture and Taxation buildings in Trenton. The Republican governor wants new state office buildings to house the agencies on state land.
The State House Commission voted last month to delay the project until Gov.-elect Phil Murphy is in office, but a special meeting was called Thursday to resurrect the plan under Christie’s tenure.
“I think the state building these new state office building, surrounded by parking lots, with no access to mass transit and not part of a more comprehensive mixed-use development that includes market-rate housing and new retail is a tragic mistake,” Torricelli said. “These new state office buildings get built once in a generation, and we’re doing it exactly wrong. Nobody builds standalone state office buildings anymore. Any developer for the value of that state office lease would build market-rate housing and get people downtown.”
If a private developer is involved in the state office
buildings project, the former state senator believes it will help lessen the burden of taxes in Trenton.
And like most other businesses in the capital city, Torricelli saw his taxes double under the city’s tax revaluation, which was implemented this year, at some of his properties.
“The taxes are to the point where it’s going to very hard to keep investing in downtown if there’s not some state assistance to maintain these taxes,” Torricelli said, adding Starbucks placed a cap of what taxes it would pay so Woodrose is paying the balance. “Some of these buildings now are being subsidized by our parking lots at the Trenton Train Station, where also the taxes are unbelievable.”
With Starbucks becoming an immediate staple on South Warren Street and the first location in Trenton for the coffeehouse giant, Torricelli visions the area becoming an emerging restaurant district.
“Right now, there’s a variety of restaurants on South Warren Street,” Torricelli said. “There are services, banks, Starbucks and Subway. We’re making it into an environment where young people will want to live. I’m actually excited about it.”