RAHWAY – A group of more than 100 business owners upset over plans to expand the city’s Special Improvement District, and charging them a special tax, are looking to take their fight to court.
A lawsuit was filed earlier this week by the Friends of Rahway Business LLC against the Rahway Municipal Council and the City of Rahway, according to William H. Michelson, a Fanwood-based attorney representing the business owners.
In December, City Council members voted to expand the SID program to nearly 400 businesses located throughout the city, from Route 1 to St. Georges Avenue.
City officials have said expanding the SID from the existing 138 businesses to 520 businesses will help better promote the 4-square-mile city. Businesses in the SID are able to take advantage of special marketing, events, street cleaning, public safety and facade improvement programs.
Within the larger SID, city officials have said there would be different areas of focus and each section might have different activities that would benefit the entire city.
“The theory is if the city advertises everyone in the town benefits,” said Michelson, adding he believes special improvement districts can be useful, but thinks the theory may be a little far fetched.
“Many and perhaps all of the property owners affected by the expansion of the SID would not, in any reasonable or even imaginable way, benefit from the SID designation and SID activities,” the lawsuit states.
According to the suit, the expanded SID includes business owners scattered throughout the city, some not contiguous to the existing SID.
Michelson said there is a isolated property, a doctor’s office, included in the expanded SID that is located near the Clark border. He said said there are some industrial owners who don’t understand how the SID would pertain to them. He said the expanded SID also includes some mixed uses with apartments on the upper floors and businesses on the lower floors.
Inclusion in the SID comes with a cost — a separate tax based on the budget for the district. Currently, the 138 businesses in the SID pay a tax of 35.1 cents per $100 of assessed value. Because of the variety of assessments on city businesses, officials have said it’s hard to give an average of what businesses pay. An estimate of the tax under the expanded SID has not been determined.
Michelson said the city would like to set the expanded SID tax and make the businesses in the expanded SID pay the additional tax and put the money into escrow until a determination is made about how much the city will be allowed to keep.
“That’s the first thing I will fight,” Michelson said.
Patrick Cassio, a small-business owner who is politically active, has said the city is looking to collect about $700,000 with the special tax.
The suit states an apparent motive for the expansion is to rectify past overspending by the existing SID and perhaps the Arts District Board, city government and other entities by levying additional taxes on the property owners.
Michelson said the lawsuit has been forwarded to the city’s new municipal attorney, Brian Hak, from the Weiner Lesniak law firm in Parsippany. A message left for Hak seeking comment was not returned by deadline.
Staff Writer Suzanne Russell: 732-565-7335; email@example.com
Recommended article: Chomsky: We Are All – Fill in the Blank.
This entry passed through the Full-Text RSS service – if this is your content and you’re reading it on someone else’s site, please read the FAQ at fivefilters.org/content-only/faq.php#publishers.
Powered by WPeMatico