5 million reasons for Harrison to be esctatic

via The Observer Online

It was six days after Independence Day but Harrison authorities had an excuse to belatedly shoot off fireworks if they’d wanted to do so.

That’s because on July 10, a day before they were due back in State Tax court ñ the New York Red Bulls dropped off a check for a cool $5,615,287.73 representing about two and a half years of back taxes plus 18% in interest fees.

The town and the Red Bulls, a professional soccer team that made its home in Harrison when it built a $200 million stadium off Frank E. Rodgers Boulevard, have been skirmishing over whether Harrison has the right to tax the teamís property.

The Red Bulls, represented by the Woodbridge law firm of Greenbaum Rowe Smith & Davis, LLP, argued that because the land occupied by the Red Bull Arena is publicly-owned and because the team is providing a public recreation service promoted by county and local government entities that issued some $40 million in bonds to acquire the land leased to the team, the property should be tax-exempt.

But in a Jan. 6 opinion, State Tax Court Judge Christine Nugent ruled otherwise, declaring that both the land and stadium should be subject to local property taxes.

Town Attorney Paul Zarbetski said last week that as part of a settlement agreement, the team will pay Harrison for the two remaining tax quarters of 2012 which will generate an additional $925,000 approximately.

However, Zarbetski added, the Red Bulls want to preserve their right to press on with its anti-tax arguments with the state appellate court for 2010 and 2011 and will likely file a new complaint to contest taxes for 2012.

The Red Bulls had been on the hook for an annual rent payment of $150,000 to the town but Zarbetski said that because the state tax judge has pronounced the Red Bulls land and stadium fully taxable, that fee will go by the boards.

Thomas J. Denitzio Jr., the attorney with the Woodbridge firm handling the Red Bulls case, would say only that his clients were ìpleased with the progress theyíve made in addressing the case,î but because the litigation is continuing, ìweíre precluded from discussing the case further.î

At any rate, Zarbetski and Harrison Mayor Raymond McDonough couldnít be happier about the timing of the Red Bullsí payment.

“Theyíre about 5% of our (municipal) tax levy,” Zarbetski noted, “so getting this money should bring us up to virtually 100%.”

Asked if Harrison would use the new revenue to hire additional employees, McDonough said: “No, we’ll just be banking the money, controlling the taxes. In fact, according to what my financial officer (Gabriela Simoes) tells me, if we hadnít gotten the money, there wouldíve been a (municipal) tax increase of $850 to $900 (on the average house) for this year, but now that increase should be only $200.”

The 2012 municipal budget has yet to be adopted by Harrison.

McDonough, meanwhile, is counting on the town seeing more revenues from local development projects, such as the new Element by Westin, a $38 million, 7-story, 138-room hotel to be built by Ironstate Development. Its first floor will contain the lobby and retail shops; the second floor will have meeting rooms, an indoor pool and a workout room.

This hotel will rise in front of the Harrison Parking Center garage on the west side of Frank E. Rodgers Boulevard and half-way up Somerset St.  Construction is expected to start next month and the hotel should open sometime in the first quarter of next year. Guests will park in the Harrison Parking Center garage as an additional expense.

The Pegasus Group and Ironstate, partnering to build Harrison Station, a mixed-use development of residential/retail next to the Harrison PATH station, have completed Phase 1, having rented all but one of the 275 apartments, according to Pegasus executive Richard Miller.

Last week McDonough said the town received a check for $307,000 from the Harrison Station developers representing their contribution to the townís Affordable Housing Trust Fund.

Of the 15,000 square feet of retail space targeted as part of the first phase of development, one tenant ñ Five Guys Burgers and Fries ñ has moved in and a second, Pronto Market ñ which has established a presence in Newarkís Ironbound section ñ will open shortly, Miller said. The remaining retail tenants are expected to be a Japanese restaurant, a vitamin store and a drycleaner, he said. Those shops should generate in excess of 100 jobs, according to Miller.

Directly across Frank E. Rodgers Blvd., Heller Urban Renewal is knocking down the old Hartz Mountain warehouses where the firm intends to build a mixed-use community of 747 one- and two-bedroom luxury apartments and 30,000 square feet of retail.

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