In this appeal, this court determines that a municipality may not condition the grant of tax abatements pursuant to the Long Term Tax Exemption Law (LTTEL), N.J.S.A. 40A:20-1 to -22, upon the redevelopers paying two million dollars through Prepayment Agreements. These payments were characterized as "a portion" of the Annual Service Charge the redeveloper would pay in lieu of property taxes after the project was completed. This court thus affirms the part of the judgment entered by the Law Division that declared the Prepayment Agreements ultra vires and ordered the municipality to refund the two million dollars to the redeveloper.
This court also determines that pursuant to the Local Redevelopment and Housing Law, N.J.S.A. 40A:12A-1 to -73, a municipality may require the redeveloper to contribute to an Affordable Housing Trust Fund (AHTF) established by the municipality as a condition for granting a tax abatement under the LTTEL. N.J.S.A. 40A:12A-4.1. This court thus reverses the decision of the Law Division that ordered the City to return to the redeveloper a combined $710,769 initial contribution it made to the municipal AHTF, as a condition for the municipality granting the tax abatement under the LTTEL.