A little piece of property has created a bit of debate at East Brunswick’s Town Hall.
During a recent meeting, the Township Council voted 3-2 to reject a bid to sell a small tract of surplus property on Lee Street, off Old Bridge Turnpike, to Ben Perry Construction for $75,000.
The 6,600-square-foot property came into the township’s possession due to a foreclosure, said Township Financial Officer Lou Neely. The previous owner had not paid her taxes for many years, and when the owner passed away, the taxes that had accumulated were more valuable than the property, he said.
The house, though, was deemed a hazard and had to be razed, Neely said.
“We improved the neighborhood,” he said. “The neighbors were happy to have the house come down in the condition it was in.”
About a year ago, Neely said, the property was appraised at $150,000. But based upon prior sales, that figure might be on the higher end of the market, he noted.
The township offered the property for sale for eight or nine months, but was unable to find any bidders on the undersized lot, he said.
The township finally found a bidder in Ben Perry Construction, which wanted to build a single-family home on the land, Neely said. Because it is an undersized lot, the construction company would need to obtain a variance from the township Zoning Board ofAdjustment to begin construction. The bid was conditional on approval of this variance, Neely said.
If the proposed home was built, Neely said, the sale would generate $75,000 in revenue for next year’s budget, and $4,000 to $6,000 in annual property tax revenue, with $800 to $1,200 of that going to the township. As such, Neely said the bid was “really a win” for the township.
“For one small little lot that could improve the neighborhood with a new house, improve our tax rolls, help the Board of Education, reduce a liability and give you $75,000 for next year’s budget, I really think that is all very positive,” Neely said.
Neely said the sale would also spur on some beneficial economic activity.
“God bless it if some developer makes a couple of dollars in today’s economy,” Neely said. “I think that that is probably pretty healthy. There are a lot of people who aren’t making any money.”
However, Republican Councilman JamesWendell said he was concerned about selling the property for half the appraisal price.
“I think that it would be better served for the taxpayers of this town to hold onto this property until the market gets better,” he said. “I am never a fan of selling an asset.”
If the township waits to sell the property when the housing market recovers, Wendell said, it could get bids closer to the $150,000 appraisal price.
But Mayor David Stahl, a Democrat, said that with the current uncertainty in the real estate market, the benefits of the sale outweigh the potential for more money down the line.
“The township should not be in the business of being speculative about the real estate market,” Stahl said. “We are not in the business of playing markets up or down. We are in the business of providing services to residents.”
Stahl said he does not believe the government should be holding property, and added that he sees “no downside” in the bid.
“A vacant lot invariably leads to problems,” Stahl said. “I believe that the township has an obligation to that neighborhood to put a home in there and increase everyone’s property values and bring the neighborhood back to what it was.”
But Republican council President Camille Ferraro said she was not comfortable with selling the property, stating that it is not to the financial benefit of the township.
Property tax revenue on the land would not support the tuition for two to three students, according to Neely, and as such, Ferraro said it might be better to look for alternative uses for the land or simply hold on to the property.
“Once you sell land, it is gone,” Ferraro said. “That money [generated from the sale] is just going to float away.”