CRANFORD, NJ — A demographer hired by the Board of Education estimates 99 students will be added to the school district when the Birchwood apartment complex is fully occupied.
The question Township Committee members have begun to focus on is how much of the payment in lieu of taxes, or PILOT, agreement the town struck with developers last year will be allocated to the board to offset the impact of those 99 students.
The 225-unit apartment complex on the border with Kenilworth includes 34 affordable housing units and has been several years in the making. The redevelopment was delayed by changing builders and lawsuits over the township’s Mount Laurel requirements. Originally projected at about 360 units, the township worked to lower that number after several residents voiced their concerns about overdevelopment. The committee on May 8 approved a 30-year PILOT agreement with Birchwood Developers Urban Renewal Associates, LocalSource previously reported. The developer will pay 11 percent of its yearly gross revenue to the town as an annual payment rather than taxes, the PILOT ordinance states. The developers of the Birchwood Avenue project also will pay an annual 2 percent administrative fee to the township.
At the time, the committee announced that it would dedicate a percentage of the PILOT to the schools, since the development would be exempt from school taxes. The matter had not been revisited until last month when the committee invited board members to attend a workshop session in which the subject was on the agenda.
“We are in the process of working out what that formula would be more or less,” Mayor Patrick Giblin said in a phone interview Feb. 16. “It was a productive discussion. There are some questions where we need some more information, some things we need to clarify, but we expect to move it along. It’s not something that we expect to be held up. But at the same time, there’s no revenue coming in in the near future that is going to be impacted by it.”
Giblin, who voted against the PILOT agreement, said it is “very unusual” for a municipality to earmark PILOT money for schools. He said one of the issues the committee is facing is weighing the cost of students to the school board’s budget against the cost of municipal services the township will incur once the apartments are occupied. He called it a “balancing act.”
The 16-acre site known in Cranford as the Birchwood development is well under construction for three apartment buildings which are to include
225 units, 34 of which are designated for subsidized, or ‘affordable’ Mount Laurel housing.
Board president Kurt Petschow Jr. said that he doesn’t expect to see students from the Birchwood apartments entering the school system until late 2020 or early 2021. He said it costs about $15,000 a year to educate a student in Cranford, considering factors such as bussing, lunches and after-school activities.
“The township is trying to get a grip on what we’re going to need to try to defer the costs of what we believe will be students in those schools,” Petschow said. “They are working with us pretty much tirelessly or working with us right now to come up with a proposal of how that’s going to look as far as what we’re going to receive as the board of ed.”
Under the guidance of former township administrator Terence Wall, the township had purchased the property for $18 million, but sold the land at 215 and 235 Birchwood avenues to the developer for $18.5 million.