Minutes: August 18, 2014*

Township Council Work Session

The Workshop Meeting of the Township Council of the Township of Vernon was convened at 7:00 p.m. on Monday, August 18, 2014 in the Vernon Municipal Center, 21 Church Street, Vernon, New Jersey with Council President Brian Lynch presiding.

Statement of Compliance

Adequate notice of this meeting had been provided to the public and the press on August 12, 2014, and was posted on the bulletin board in the Municipal Building in accordance with the Open Public Meetings Act, N.J.S.A. 10:4-7.

Salute to the Flag

Council President Lynch led the assemblage in the salute to the flag.

Roll Call of Members

Present were Council Members Dan Kadish, Jean Murphy, Patrick Rizzuto, Dick Wetzel and Council President Lynch. Also present were Township Mayor Victor Marotta and CFO, Elke Yetter.

There was no Executive Session.

Public Comment

Council President Lynch asked for a motion to open the meeting for public comments.
Motion: Jean Murphy
Second: Dan Kadish
All members were in favor.

There were no public comments.

Closed to Public Comments

Seeing no members of the public wishing to speak, Council President Lynch asked for a motion to close the public portion of the meeting.
Motion: Dan Kadish
Second: Patrick Rizzuto
All members were in favor.

Presentation/Items for Discussion: Mountain Creek Pilot

Council President Lynch asked the CEO, Andrew Mulvihill, Attorney John Fetterly and Bill Benneyan of Mountain Creek to please come forward.

Mr. Mulvihill apologized that he was unable to attend last weeks meeting. Mr. Mulvihill stated he would like to give a presentation on a proposed Water park to be built in Vernon. Mr. Mulvihill explained that he was requesting that financing for a part of the water park be made through a payment in lieu of taxes or PILOT agreement in keeping with the master plan that was created some thirty years ago. Mr. Mulvihill explained that in order to create the water park a lot of work was needed. Mr. Mulvihill explained that the PILOT would be needed to attract investors to the project. Mr. Mulvilhill noted that two competitors had received PILOT agreements for water parks in the Poconos.

Mr. Mulvihill explained that theme of the property would be a themed as an enchanted forest but rustic with 400 rooms, that include 1, 2 and 3 bedroom suites and the project was envisioned as part of the master plan. Mr. Mulvihill indicated that there would be a wave pool, mini golf, tube rides and spa as well as a convention center. Mr. Mulvihill stated they may build as sports facility that included camps. Mr. Mulvihill noted that seasonality is a big issue at the current facilities but having an indoor park that issue is eliminated and it makes occupancy more consistent. Mr. Mulvilhill explained that occupancy would result in more year round jobs. Mr. Mulvihill indicated that the water park room availability would be undersized to drive attendance to the Appalachian. Mr. Mulvihill continued noting that the Appalachian was under performing because there were not enough amenities. Mr. Mulvihill explained the Township would benefit not just from the increase in taxes but the increase in the Hotel Occupancy Tax that the Township would receive. Mr. Mulvihill noted that no big traffic impact was expected as the facility had sufficient parking and trained staff. Mr. Mulvihill also noted that arrivals and departures come throughout the day; however they will provide a traffic study as they had done in the past when applying for a site plan. Mr. Fetterly explained there was a budget of $140 million for this project and that they were seeking a Tax Increment Financing or TIF plan for the funds needed to complete the project. Mr. Fetterly indicated that Mountain Creek was seeking $28 million in a TIF. Mr. Fetterly noted that only areas in the Township that were in a redevelopment zone could qualify for a TIF. Mr. Fetterly further explained they were seeking a PILOT agreement and would be asking the town to provide a Redevelopment Area Bond or RAB. Mr. Fetterly stated that rather than pay the generally applicable taxes the project would pay a set amount sometimes equal to the amount of the taxes and sometimes less. Mr. Fetterly continued that a PILOT agreement was the first step and that part of the money would be used to purchase bonds. Mr. Fetterly stated the Township would pledge a portion of the PILOT to the payment of the RAB. Mr. Fetterly stated that the current tax on the property was $15,500 under the PILOT the payment would be structured that the Township would receive 40% of the payment 5% to the school (which was optional) 5% to the County and 30% to the RAB trust. Mr. Fetterly noted under the tax rate a $3.2 million PILOT could be supported. Mr. Fetterly requested 50% of the tax revenue the town would have received be pledged to a trust to pay the bond holders who have invested in the project. Council President Lynch questioned if the Township became a fiduciary in that scenario. Mr. Fetterly explained the Township was not the fiduciary, just the collector and distributor of the payment which becomes a lien on the property. Mr. Mulvihill noted that the Township would be receiving hotel occupancy tax and creating jobs which would be an advantage to the township. Mr. Fetterly noted that without this support the project does not move forward. Mr. Fetterly pointed out that the bonds would be issued by the NJ Economic Development Authority or the Morris County Improvement Authority and this was a financial agreement between Mountain Creek and Vernon Township. Mr. Fetterly stated that in Pennsylvania the two towns involved pledged 100% of the taxes they were to receive for the project. Mr. Fetterly explained that the agreement would be reviewed by the Local Finance Board. Mr. Fetterly stated that this piece of the financing was critical. Mr. Mulvihill stated that the property was purchased in 2010. Mr. Mulvilhill stated that there also might be a new reality series based on Action Park. Mr. Mulvihill stated the best use of the property and best opportunity would be the water park. Mr. Mulvihill expressed hope that the PILOT agreement could be done.

Council President Lynch stated he had visited Wisconsin Dells and all they seemed to have was water parks but nothing else, it would be fortunate if the township had a four season water park. Council President Lynch thanked Mr. Mulvilhill, Mr. Fetterly and Mr. Benneyan for their presentation.

Council Member Wetzel stated that he had read an article about how the recession had affected Vernon; it talked about a couple who had moved here and after all this time they still have to commute because there are no jobs here. Council Member Wetzel stated if New York can actively advertise that they are offering no taxes for 10 years to get businesses to come there than he felt that Vernon can provide a tax incentive. Council Member Wetzel noted this would bring the tax rate down in Vernon and the Township would receive over $1 million in the next several years.

Council Member Rizzuto questioned how many jobs were expected to be generated by this project. Mr. Mulvihill indicated that it was anticipated to have 400-600 direct jobs and 200-400 indirect jobs not including the temporary construction workers.

Council President Lynch questioned if Mountain Creek was current on its taxes. Mayor Marotta explained that they were. Council Member Wetzel asked what is the advantage. Mayor Marotta questioned if the amount of the bond changed over time. Mr. Fetterly explained that it did not.


Council President Lynch asked for a motion requesting to give the Administrator and CFO the authority to have the Bond Counsel move forward in drafting the specifications and bring forth a refunding bond ordinance.

Motion: Patrick Rizzuto
Second: Dick Wetzel

A roll call vote was taken:
Ayes: Dan Kadish, Jean Murphy Patrick Rizzuto, Dick Wetzel, Brian Lynch
Nays: None
Abstain: None

Council Comments

Council Member Kadish stated that he had no comment.

Council Member Murphy stated that she had no comment.

Council Member Wetzel stated that he had no comment.

Council Member Rizzuto stated that he had no comment.

Council President Lynch stated that he had had a very interesting Saturday because he had participated in a public shooter practice drill with the Fire Department and Police Department. Council President Lynch stated that the participants had done a great job. Council President Lynch noted that with tonight’s project that as a member of the Council you always regret the things you didn’t do.


There being no further items of business to be conducted on the Work Session Meeting agenda, a motion for Adjournment was made by Council Member Rizzuto, seconded by Council Member Wetzel with all members voting in favor.

The Work Session Meeting of the Township Council of the Township of Vernon was adjourned at 8:44 p.m.

Respectfully submitted,
Lauren Kirkman, RMC
Municipal Clerk

Minutes approved: September 8, 2014