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Region 9 seeks Hibernia purchase and lower PILOT rates; council weighs trade-offs and permitting concessions
Summary
Region 9 expects to close on the Hibernia property in late September and proposes a phased reduction in the city's PILOT schedule; council discussed the financing assurances tied to HMFA, possible permitting-fee concessions and requested staff prepare a pilot-assignment resolution ahead of closing.
Region 9, a nonprofit housing corporation, told the Lambertville City Council it expects to close on the Hibernia property at the end of September and plans to invest roughly $2 million to renovate apartments for senior residents.
Council discussed a proposal from Region 9 to adjust the current payment-in-lieu-of-taxes (PILOT) schedule, which the transcript records as a 7.5% rate that now extends through 2037. Region 9 proposed stepping that rate down beginning in 2027 (for example, to 7.0% and down to 6.0% by 2037), a change the council said would reduce city revenue year by year.
Why it matters: The Hibernia property provides senior affordable housing and Region 9’s model keeps such properties in nonprofit ownership with 100% affordable units; council members said HMFA-linked financing and mortgage conditions typically enforce renovation and affordability commitments. Staff said the city’s financial adviser and municipal counsel did not see fiscal red flags with the proposed schedule but framed the issue as a policy decision for the council.
Council concerns and process: Council members asked how PILOT receipts are used; staff explained payments are collected into the city operating budget (some county portions may be involved). Council members also raised whether fee waivers or reductions for permit costs should be considered; the construction-code official flagged that permitting-fee reductions are complex and vary by scope and size of the project. The mayor said staff would prepare the necessary documents for the council to assign the existing pilot or to negotiate a different PILOT schedule prior to Region 9’s closing.
Assurances and enforcement: Council discussed enforcement through financing: HMFA financing, if used, typically includes binding obligations that require renovations and impose monitoring by funders. Council members emphasized the city should rely on those financing controls and written agreements rather than verbal assurances.
Next steps: Staff will prepare an assignment of the existing pilot (or an amended PILOT proposal if the council directs negotiations) for council consideration at an upcoming meeting; Region 9’s closing timeline and the council’s willingness to negotiate pilot terms will determine whether a revised PILOT is adopted before the property transfers.
