HOBOKEN, NJ – (UPDATED at 3:15) A schoolyard scuffle has broken out as parties in Hoboken disagree over the distribution of PILOT payments to schools.

At last week's Council meeting, the topic of the Payment In Lieu Of Taxes (PILOT) prompted questions among council members and residents as to whether the monies currently due to the Hoboken Public School District from the development at 770 Jackson Street should be proportionally distributed to the Charter Schools operating within the Hoboken school system.

In 2016, Hoboken entered into a PILOT agreement in which the developer agreed to provide $52 million worth of community givebacks—including the resiliency park at 7th and Jackson, a children’s playground, a pedestrian plaza, underground flood infrastructure, 42 units of affordable housing, and a new basketball gymnasium.

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On Friday, Mayor Ravi Bhalla issued a Nixle Alert specifically on the matter, saying, “I believe that the 7th and Jackson PILOT agreement provided us with incredible community benefits in an economically feasible manner. However, some challenges remain. As you may know, our tax bill consists primarily of three portions—municipal, county, and school taxes. Under New Jersey State law as it pertains to PILOT agreements, the portion of taxes that would have been collected and paid to the Hoboken School District from 770 Jackson Street cannot be collected, even though adding residential units may result in higher school enrollment.  But New Jersey law prohibits PILOT payments from being made directly, or assigned by the developer, to the Hoboken School District. Those payments instead go predominantly to the City (95%) with a small portion going to the County (5%).”

With the money going to the City of Hoboken, the City is then responsible for distributing those funds.

According to Bhalla, “As it pertains to the Hoboken Charter Schools, the PILOT payment has no effect on funding to which the charter schools are entitled. Charter schools are provided a payment each year from the Hoboken Public School District based strictly on a formula established by the State of New Jersey which is unaffected by any previous, current or future PILOT agreements.”

Council Ruben Ramos cited the 2016 resolution introduced by Mike Russo and Dave Mello, specifically addressing the issue of PILOT payments to the schools, telling TAPinto Hoboken, “That resolution was written to direct that funding using charter school kids as part of the equation,” adding, “it’s a Payment In Lieu Of Taxes… so the math is already there.”

Tax funding for the District is currently broken down so that 78.1% of funding goes to the Public Schools, while 21.8% goes to the Charter Schools.

Principals at the city’s three charter schools also sent a shared statement to TAPinto Hoboken, saying, “Traditional PILOT programs hurt all public schools, district and public charters alike, as they cut out property taxes that fund school budgets. In 2016, the Hoboken City Council admirably addressed this issue in the 770 Jackson PILOT by earmarking money for our Hoboken public schools. Excluding funding for all public charter school students now—four years after the resolution passed—would be both unfair and inequitable.”

Lauren Calmas (Hoboken Charter School), Nicole Cammarota (HoLa Hoboken Dual Language Charter School), and Chris DeFilippis (Elysian Charter School) concluded their statement by saying, “We remain committed to working collaboratively for fair funding for our 1,000 public charter school students, their families and our staff.”

The Hoboken Board of Education, meanwhile, sent out an email to parents late Sunday night, outlining their argument for maintaining control of the funds.

"Local elected Boards of Education are directed by the state to pay each charter school tuition for students enrolled from their respective municipalities. Simply put, granting monies from the PILOT payments for 770 Jackson Street to the charter schools ignores the legal process by which charter schools are funded in NJ," read the letter, signed by the Hoboken Board of Education. "This isn’t an issue for the Hoboken City Council to determine, nor does it represent any cut or reduction in funding to the three charter districts."  

The letter goes on to invite parents to write to Councilmembers on the BOE's behalf. 

The next City Council meeting is scheduled for Wednesday, October 21, 2020.     

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