Specifically, the township would offer certain businesses a five-year graduated tax break. In the first year, a business would only have to pay 20 percent of its local tax bill. The next year it would pay 40 percent, then 60 percent the following year until the fifth year, when it finally would pay its total bill.
Township Mayor Gerald Luongo said that if the program is successful, the new ratables could reduce the current local-purpose tax of 56 cents per $100 of assessed value by 10 cents. For instance, a resident who owns a house assessed at the township average of $50,000 and paid $280 last year, would pay only $230 in the future.
Luongo said that the township must provide incentives such as tax abatements to woo industry into the increasingly competitive South Jersey real estate market.
"You have to go out and court them," Luongo said. Luongo said he is
discussing the program with three businesses, but he declined to name them. Disclosure could force up the price of the land the businesses are considering, he said. Luongo added that the types of businesses he wants to bring to the township include telephone marketing firms, manufacturers of glass and computer chips, and computer programming companies.
The township is applying to the state Department of Community Affairs' Division of Local Government Services to receive authorization for the program, but competition is stiff. During the 12 years the program has been in existence, more than 200 municipalities have applied. Only 30 have received authorization.
Washington also will be competing against another Gloucester County municipality, South Harrison Township, and perhaps Franklin Township, which is considering a program of its own. The two primary criteria for acceptance into the program are a comparatively high local tax rate and a predominantly residential tax base.
The state usually makes a decision on eligibility within a month after receiving applications, according to Richard Harpster, Department of Community Affairs press officer.
By applying for the abatement program, Luongo is trying to fulfill his campaign promise to reduce the residential tax burden and diversify the commercial profile of the township.
Currently, homeowners provide 85 percent of the township tax base, according to Leo Midure, township tax assessor. The remaining 15 percent comes
from vacant land and the hundreds of small businesses dotting the sides of the township's main arteries.
"There are a lot of shopping centers around, but they don't make up the difference," Midure said.
The application for the program also comes at a politically propitious time, as the average school tax bill may rise by $290. Earlier this month, voters rejected a $48 million school budget, which would have paid for the construction of two new schools to house the overflow of students in the school system. Although the township council has discussed reducing the budget, the largest proposed cuts would still translate into a $200 increase in the average school tax bill.
Officials also say that industry would put less strain on the municipal water supply than housing developments. This summer the township will restrict residents' outdoor water use to certain hours every other day.
The water supply problem is due in part to the township's residential building boom and the radium contamination of a township well that would have provided 25 percent of municipal water needs.