Mayor’s Update on a Key Tax Related Matter
Posted: August 14, 2020
My Vernon Family, in a July 10, 2020 communication, I addressed the most frequently asked questions that had come to me via e-mail, phone and through personal conversations, after the town mailed Vernon property owners their 3rd quarter 2020 estimated tax bills in late June.
The great majority of questioners requested clarification as to why, when the assessed value of their property had declined, their 3rd quarter 2020 estimated tax bills increased.
In my communication, I explained that this confusing occurrence was due primarily to the overall change in the town’s ratable base since the last property revaluation in 2009, and the property revaluation that our town had just completed as of October 1, 2019, for the 2020 assessment year.
As we know, during this 10 year period, property values changed several times, with some property values going up and some coming down.
Because of these changes in property values over this 10 year period of time, some individuals who were paying taxes based on the 2009 revaluation were paying property taxes that were too high, while others were paying property taxes that were too low.
I informed you that as a way of avoiding future sudden and large changes in tax amounts due, and to ensure that taxpayers are not paying taxes that are either too high or low, your mayor and council had agreed to apply to the state of New Jersey for approval to conduct property reassessments every year, rather than every 10 years.
I am pleased to announce that we have received that approval from the state.
With the implementation of the process of conducting property reassessments every year, rather than conducting the more costly and bureaucratic property revaluations every 10 years, Vernon Township will join with 116 other New Jersey municipalities who use this method of determining the value of the properties within their borders.
As part of my due diligence on this issue, I contacted the mayors of some of the towns who have had experience with using the annual reassessment method.
And, be it a municipality such as Paramus which has used this method for the last 2 years, or a municipality such as South Hackensack which has used this method for the last 9 years, or a municipality such as Bridgewater which has used this method for the last 15 years—they all said that the annual reassessment method is one that has been much better and more acceptable to both their towns and their town’s taxpayers.
Specifically, they informed me that their move to conducting annual property reassessments versus property revaluations every 10 years had greatly reduced the number of residents who felt the need to file tax appeals because they felt that their current property assessments were unfair or too high.
This reduction in tax appeals benefits the taxpayers and the town in that it saves the taxpayers the time and administrative/legal costs associated with filing a tax appeal; and, it reduces the amount of tax dollars that the town has to collect from the taxpayers to pay for the appearance of the municipal tax assessor and a municipal tax attorney at every tax appeal hearing.
For Vernon Township, a reduction in tax appeals will represent a significant savings since during the 10-year period between 2009 and 2019, our town averaged 490 tax appeals per year.
Unless a town requests and is granted a waiver, state law requires that an annual reassessment must begin within one year after the last 10-year revaluation. Because we believe that the annual reassessment procedure will be of such significant benefit to our taxpayers and our town, we have chosen to not request the waiver and to start our annual reassessment procedure at the earliest possible date, which is October 1, 2020.
By law, the annual assessment sampling period runs from October 1 - October 1. That means that during each assessment year, we will be analyzing 100% of our town’s property sales data that has occurred during this annual sampling period, but will inspect a different 20% - 25% of the properties each year.
In part, it’s the reduced number of inspections, along with not having to make major, costly corrections to our municipal tax map (which the state requires when a municipality does revaluations only every 10 years), that will contribute to Vernon being able to cut cost by conducting annual reassessments versus the every 10 year revaluations.
During this first annual assessment year, the 20% - 25% of the properties that we will be inspecting will consist of all of our town’s commercial properties, all of our town’s exempt properties that are not vacant lots (such as religious institutions/religious institutions’ property; the homes of veterans that are 100% disabled; fire department and volunteer ambulance corps facilities; the property of non-profit organizations, etc.), and all of our town’s residential properties that have been sold since the last revaluation, i.e., since October 1, 2019.
While we can’t start analyzing our town’s property sales data until October 1 of this year, we will take action to get a head start on doing the property inspections, and hope to start some inspections this month.
I will do my best to keep you informed on matters such as this that are aimed at keeping my commitment to Move Vernon Forward!
Howard L. Burrell, Mayor