Dear Editor:
Over the past few years, Parsippany’s town council has approved 11 PILOTs worth hundreds of millions of dollars in tax abatements relying solely on hypothetical, estimated PILOT payments provided by the developer based on 95% occupancy. But how realistic are these estimates? We can now answer that question for the first time because we have real-life experience gained on the 1515 Route 10 PILOT. The just introduced 2026 municipal budget anticipates that 1515 Route 10 will pay about $300,000 in PILOT payments for the year. But does $300,000 really meet the expectations of the governing body and the public?
- First, let’s remember that even if the full estimated PILOT payment of about $1 million were made, the developer would still receive a more than two-thirds discount from the conventional tax amount of over $3 million.
- The $300,000 amount that we will actually receive is less than 1/3 of the $1 million PILOT payment that was projected. This reduced PILOT payment represents a massive discount of about 90% compared to conventional taxes.
- Next, who is responsible for making sure that Parsippany receives the proper contractual PILOT payment amount from the developer? The amount of $300,000 that Parsippany is being paid in 2026 does not even meet the minimum PILOT payment amount specified in the contract.
- Lastly, the $300,000 PILOT payment for 2026 is less than the $420,000 land tax that Parsippany was receiving when there was no building on the property. Think about that for a minute. Parsippany would receive more in tax revenues today, without having to provide extra municipal services, without the extra congestion, and without the extra school children, if the 1515 Route 10 development were never built.
Concrete data from the 1515 PILOT substantiates my belief that PILOTs, especially residential PILOTs, are a bad deal for the municipality even under the best of circumstances. On top of that it is now clear that Parsippany should not rely on the exaggerated PILOT payment estimates provided by the developer, nor can the council depend on its own financial advisor to uncover the land mines hidden in the PILOT agreements. So, given what we know about PILOTs in general, and from the real-life experience of the 1515 Route 10 PILOT, I strongly request that the town council table any future PILOT agreements until there is clear evidence that Parsippany is not being victimized again.
Bob Venezia
Parsippany
