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A tax-exempt landlord and its rowdy tenant
Over a dozen minors were treated by first aid and taken to local hospital emergency rooms for alcohol-related illness following a Gwen Stefani concert at the PNC Bank Arts Center last month. At a concert headlined by Fall Out Boy last week, over 50 arrests were made at the venue, most for underage drinking. The stories are recent, but for Holmdel, the aggravations are certainly nothing new.
The bad behavior at recent shows has sparked a lively debate on underage drinking at the arts center, how to curb it and how far officials should go in their efforts to quell the problem. In our view, the situation also amplifies how unfair it is that Holmdel should continue to shoulder the burdens of this venue while reaping so few of its rewards. That's a discussion that's not being had, and we suspect the state would like to keep it that way.
For a decade, the township and the New Jersey Turnpike Authority have battled over whether Holmdel should be entitled to tax revenues generated by the arts center. To Holmdel, the facility should no longer have been protected under its tax-exempt status once its operations were privatized under Gov. Christine Todd Whitman. The venue today is so foreign from the operation originally envisioned by the Legislature, Holmdel has argued, that it no longer deserves that status. In separate decisions, the New Jersey Tax Court and Supreme Court Appellate Division agreed.
The best way we can describe the state's relationship with the arts center is like that of the landlord of a rowdy tenant. Today, concerts are booked and managed by a company called Live Nation, and the Robert B. Meyner Reception Center is run by private catering companies.
However, in a surprising and apparently final decision on the dispute in April, the New Jersey Supreme Court sided primarily with the turnpike authority. The original purpose of the venue envisioned by the Legislature was to generate tolls for the authority in off-peak hours, the court concluded, and the arts center still does that. The Meyner Center doesn't do that and should therefore not be tax-exempt, the court said. The issue of the arts center being controlled by a publicly traded corporation apparently played no part in the court's decision.
There's something wrong when Holmdel has to deal several times a summer with the fallout from 10,000 fans partying at a rock concert, but is only paid for a banquet hall that holds a few hundred. While law enforcement at the arts center is the jurisdiction of the N.J. State Police, Holmdel police officers are also called on to assist in some situations and must be prepared to offer that help at any time.
The difficulties of being the hometown of the arts center are suddenly right there for the whole state to see. The timing might not be bad for local officials to push for a fairer financial arrangement on this matter, outside of court.
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