What is a long-term tax exemption or payments in lieu of taxes (PILOT)?

A long-term tax exemption is an exemption from paying taxes on the value of the improvements made to property as part of a redevelopment agreement. The term of the exemption can last anywhere from 10 to 30 years. In lieu of paying taxes on the exempted value of the improvements during that term, the redeveloper pays annual service charges, or payments in lieu of taxes (PILOT) at an amount agreed to by the parties based upon a formula set forth in the Long-Term Tax Exemption Law, N.J.S.A. 40A:20A-1, et seq.

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1. What is redevelopment?
2. What is an “area in need of redevelopment”?
3. What is the process to determine that an area qualifies as an “area in need of redevelopment”?
4. Doesn’t an “area in need of redevelopment” have a negative connotation?
5. What are the benefits for property owners located in an area in need of redevelopment?
6. What is a redevelopment plan?
7. What is the process for adopting a redevelopment plan?
8. What is a long-term tax exemption or payments in lieu of taxes (PILOT)?
9. What are the benefits of a payments in lieu of taxes (PILOT) to a redeveloper?
10. What are the benefits of a payments in lieu of taxes (PILOT) to the municipality?
11. Is the school district harmed by payments in lieu of taxes (PILOTs)?
12. Why would the Town need or want more apartments?
13. Will more development cause too much traffic and congestion?