Shop local, get tax break?

Image courtesy Fincredit, Inc. This could be the prototype for Shop Kearny Card.
Image courtesy Fincredit, Inc.
This could be the prototype for Shop Kearny Card.

By Ron Leir
Observer Correspondent


Kearny homeowners who are dedicated local shoppers may soon be getting a break on their property taxes.

Because every ka ching heard on a retail register will – if the town governing body approves – signal a discount on a property owner’s local tax bill.

That’s the premise of a “Kearny Tax Reward” program being cooked up by John Peneda, who doubles as town Tax Assessor and Coordinator of the Kearny Urban Enterprise Zone (UEZ) program.

Peneda said the plan is based on an initiative developed by Marlboro Township, which reportedly pioneered the concept in concert with a company called Fincredit Inc., also based in Marlboro.

Peneda, who learned about it through a New Jersey State League of Municipalities publication, has already talked up what he perceives as its merits with his UEZ board and now wants to know “if there’s interest in it from our retailers and service businesses” before moving forward.

Any business people in Kearny who provide a service to the public – anyone from limousine operators to lawyers – are invited to a UEZsponsored seminar about the program on Thursday, April 4, at 6 p.m. in the second-floor chambers at Town Hall, 402 Kearny Ave. UEZ membership isn’t required to attend.

Those planning to attend are asked to reserve a seat by Tuesday, April 2, by e-mailing or phoning 201-998-7400, ext. 8041.

“If we get a good response, we’ll bring it back to our [UEZ] board at the April meeting,” Peneda said. “If they approve, then we’ll ask the mayor and council to consider it, probably in May. Earliest case scenario, we could implement it to coincide with this year’s third and fourth quarter tax bills.”

Here’s how the program would work: Kearny would issue “reward cards,” similar to a credit or debit card, to homeowners. For each purchase or service, the participating merchant or professional swipes the card to a dedicated processing machine provided by Fincredit to register the transaction in the homeowner’s “reward” account, thereby generating a tax credit for the homeowner.

The business would receive full price for the product or service. How much of a discount would be a flat percentage, to be determined by the town. Fincredit would collect the “rebates” from businesses on a weekly basis and deposit those funds in a dedicated bank account.

Once a year, Fincredit would get from Kearny a digital list of property owners’ tax bills by block and lot, apply the credits from each owner’s business transactions and send the updated records back to the town. Fincredit would send Kearny a check for the total amount of the rebates.

A small percentage of the tax credits collected would go to Fincredit.

“I like the program,” said Peneda, “because it helps local businesses increase their sales volume and helps property owners reduce their taxes.”

Peneda said that Kearny Federal Savings Bank has expressed interest in providing the reward cards to the town and, if that happened, “that would be one expense we don’t have to have.”

Fincredit Managing Director Carmine DeFalco told The Observer that the company can provide local retailers a swipe machine for $160, including shipment and programming, although, “for low-volume businesses, we can process transactions online for nothing from our web portal.”

Participating businesses would get free listings on the company’s web portal which, according to DeFalco, “gets a lot of traffic.”

Since mid-September 2012, when it helped Marlboro set up its reward system, the program has generated local purchases of $240,000 for 41 participating businesses and more than $13,000 in tax savings for 2,000 registered households, DeFalco said.

“But those numbers are going to grow,” he said. “We’re hoping for between 70 and 80 businesses to sign up.”

When Marlboro homeowners register online, they can check to see which businesses are in the reward program, he said.

DeFalco said Fincredit is working with several other New Jersey municipalities to set up similar reward programs.

“Bayonne has given us the goahead and we’re working out the design now,” he said. Other communities “looking to launch in about two months” include Pequannock, Caldwell, Highland Park and Voorhees. “We’re also talking to a town in Massachusetts looking at the concept,” he said.

And they may well be adding Kearny to the list.

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