PILOT Grounded

Dear, Reader,
Unbelievable!
Literally, we DON’T BELIEVE IT! The council appeared to turn down a PILOT request. We are skeptical.
PILOT stands for a long, misleading phrase that means “tax exemption”. Oh, if you must know, it is – “Payment In LIeu of Taxes.” But, there are no payments, the recipient just gets to keep their tax money.
Don’t get your hopes up, Dear Readers, YOU can’t apply for one, unless you are a nonprofit, public (or private/public) housing developer.
The reason we are skeptical that the council will actually turn down one of the two March 13 PILOT requests is that we’ve heard them make threats before. Then, when it comes to a vote, we’ve seen them get all dewey-eyed about the Good Works the PILOT applicant does and hand them at least a portion of what they were requesting.


There WAS one big difference this time, however. When the mayor summarized the council’s opinions, as he usually does at the end of an agenda item discussion, he said there was not enough council support for the PILOT, so there would be “no PILOT at this time.” He SEEMED to be telling the city clerk not to bother putting the PILOT on any future agendas. BUT! He did say “at this time.” We shall see, we shall see!
The applicant was handed a thin, greasy thread of hope – a possible adjustment to their city stormwater fees. The developer, the Community Preservation Development Corporation, requested not only a tax exception, but a stormwater fee exemption, too. This rubbed the council’s hair the wrong way. Most of them sputtered and glowered about it.  
The CPDC representative was dismayed, as he finally expressed when a councilmember said he should have looked for more creative ways for city support than a tax waiver. We DID, he said, rubbing his bruises, that’s why we asked for stormwater fee exemption!
Oh, you did, well that’s a whole different story . . .  hmmm, said the council, collectively scratching it’s head and scrunching it’s collective face in that adorable “let me think about this” grimace. It is SO cute when they do it all at once!
There just MIGHT be a way to reduce the fee without creating special exemptions (a precident they don’t want to make), they said. There’s a provision of the stormwater ordinances  that says property owners who exceed stormwater management requirements get a discount. The CPDC representative said the renovations they want to make are “green.” That might reduce impermeable surface – hard surfaces  that shed instead of absorb storm water – so, getting that discount was a possibility.
The property in question is Essex House at 7777 Maple Avenue. The developer already owns and maintains the building. The developer wanted approximately a $17,000 yearly exemption for 30 years. The council said they would be more amenable if the development were new and the funds were needed to revive a shabby building. Then an exemption would be an investment in raising real estate values – which would mean more tax revenues in the future.
An irritated counclmember Josh Wright said the state’s role in the PILOT request was “a lot like playing chicken.” The state requires developers to secure exemptions from local jurisdiction, This would qualify them to raise renovation funds by selling tax credits . Yeah, it’s complicated – and we gave the simplified version!
It boils down to the state pressuring the city to give up income to help out the developer. Or, the way Wright sees it, the state and city are driving cars toward the cliff edge, and the state expects the softhearted city to jump first. “I’m ready to play chicken!” warned Wright.
It should be noted that the council was not unanimous in turning down the PILOT. Councilmember Terry Seamens in whose ward Essex House sits expressed disappointment that his colleagues didn’t support the request.
PILOT To Fly
The council did grant 50% of the PILOT requested for 4 city properties owned by the Coalition for the Homeless. The request was for around  $7,700. That will be reduced to around $3850 yearly for 10 years, subject to renewal for another 10 years. That’s IF the council votes for it with no further changes.
According to a city-issued handout , “There are currently seven PILOT agreements in effect in Takoma Park. They range in value from $4,450 to $23,857, in FY12 with an average value of $8,700 per rental facility or $26.50 per rental unit. The aggregated value of these PILOTS is $61,195.”
Background
“Huh?” you say. “What was that all about?”
It was a bit puzzling why the developers of the Aspen Court Project were talking to t he city council. They weren’t asking for a PILOT or anything. They gave a little presentation about their development project, answered some questions, and went away. How come?
Because they ticked off councilmember Colleen Clay, that’s why. They were SUMMONED! She was steaming mad when she reported several meetings ago the developer’s treatment of longtime building residents.  Resident who just happen to be Clay’s constituents! .

About the Author

Gilbert
Gilbert is the pseudonym of a hard-bitten, hard-drinking, long-time Takoma Park resident who maintains the granolapark blog. Gilbert and William L. Brown — Granola Park's mild-mannered chief of staff, researcher, and drink pourer — have never been seen in the same place at the same time.