Woodrose Properties Golden Swan Urban Renewal LLC is one of several property holding companies owned by former Senator Robert Torricelli. We've covered this before (most recently here) but we feel it is important to recap the matter once again before tonight's vote.
The property in question is located at the corner of Front and S. Warren Streets in downtown Trenton. Formerly known as "the Caola properties", the city acquired it in 2001 through condemnation for $164,000. Woodrose then acquired it from the city for $1 in 2005.
Interestingly, in a Trentonian newspaper report from January 2005, then Mayor Doug Palmer told reporter Charles Webster that...
"Torricelli told us he's not looking at state leases, AND HE DOESN'T WANT ANY CITY MONEY OR TAX ABATEMENTS." {emphasis mine}That very same article reports that the city of Trenton "will replace the roof and provide other upgrades." Additionally, it was stated that "a back portion of the building was removed" to stabilize the structure.
By March of 2005, the city was in negotiations with Torricelli about a possible tax abatement. In a March 4, 2005 article in the Times, Eva Loayza wrote:
"[City Assistant Business Administrator Dennis] Gonzalez said the city is still negotiating whether to give Woodrose a short-term tax abatement or start tax payments right away."
As it turns out, the city did grant the developer a five year tax abatement where it would only pay 15 percent of gross revenues rather than the full taxes. (We estimate that the tax abatement ran for five years from as early as October of 2007 until the end of 2012).
The city also awarded $202,425 in Urban Enterprise Zone (UEZ) funds to cover "cost overruns". Both were reported in a December 8, 2007 article in the Times. (The city also granted $89,000 UEZ funds to another Torricelli project around the corner on W. State Street that same year).
Now, Torricelli wants to convert the office space in the building to more residential and he wants to make improvements to the HVAC system. The total project cost is estimated at about $230,500 and should take about four months.
Other than the short-term construction jobs, there will be no increase in employment associated with this project. The developer claims there is a demand for residential space downtown but the information provided with the proposed ordinance shows nothing to back that up.
And the council, so far, has not asked any probing questions about the application. In fact, when it was discussed at the council conference session on Tuesday, December 5, 2017, only Councilman Bethea asked about it. He wanted to know how long the abatement would be for (10 years) and how much the city would get.
Director of Housing and Economic Development Diana Rogers gave bare bones answers, merely explaining that the taxes paid would be based on a formula. The exchange between the two of them took an entire two and half minutes.(about 21:33 in the audio linked above) Two and one half minutes to discuss a 10 year tax abatement! (Compare that to the 15 minutes or so spent talking about an proposed BUT TABLED ordinance that would revise how the city towing contracts are handled!).
The formula, per the developer's application would be a 10 year tax abatement based on 10% of the annual revenue of the finished project minus a deduction for a vacancy rate. As proposed, the annual net income of the project would be $13,404.80 and if the abatement is granted, the city would receive $14,340 per year in taxes for the life of the abatement. If income on the project doesn't meet that projection, the taxes paid to the city would be less; if the income is higher, the taxes paid would be more.
If we were sitting on council, our vote would be an emphatic "NO". The developer has utilized the generosity of the taxpayers in the city of Trenton for over a decade. In fact, in his little address to the council on December 5, Mr. Torricelli touted how he hopes there will be more tax credits coming so he can do other development projects in the city (specifically his now surface parking lot across from the Transit Center).
Mr. Torricelli knows very well how to play the system. He'd adept at using other people's money to meet his ends. It's time for him to pay his own way.

