Business & Finance

Berkeley Heights Council Ponders Pros and Cons of Revaluation; Warns of Need for Solid Plan to Deal with Affordable Housing Mandates

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Special tax counsel Martin Allen explains the workings to property tax revaluation. Credits: Bob Faszczewski
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BERKELEY HEIGHTS, NJ—Revaluation of residential and business properties in the township could become a reality soon, not only to bring fairness to property values in Berkeley Heights, but also to possibly save property owners some money on county property taxes.

At Tuesday’s township council meeting, Mayor Robert Woodruff noted the last time a township-wide revaluation was done was 1998.

Special tax counsel Martin Allen explained that state tax laws require uniformity in taxation and the longer a community goes without revaluation the more “out of whack” the value of one piece of property will get compared to other pieces of property in a community.

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Township councilman Kevin Hall added that assessed valuation indicates the value of one property’s share of the overall value of all property in the township and the township wanted to make sure that everyone pays their fair share of property taxes.

According to township tax assessor Robert Edgar, values on properties in Berkeley Heights currently stand at about 56 percent of true market value.

Allen estimated the cost of a township-wide revaluation at $250,000 to $300,000, but added that software now on the market enables smaller reassessments to be done every year after a community-wide valuation in order to keep values current.

He also said it is advisable to update property maps prior to submitting a request for a township-wide valuation to the Union County Tax Board.

Results of revaluations could lead to a decreased amount of tax appeals, he noted, and, when property values are assessed close to the actual value a property would sell for on the open market in a fair deal between a willing seller and a willing buyer, the county tax burden for property owners probably would be less because the share of the tax burden borne by one property would probably stabilize or decrease.

“Just because your assessment increases the year folllowing revaluation does not mean you will be paying more in taxes because everyone’s assessments probably would be increasing at the same time,” the tax expert added.

Allen said the amount of change in values is a big factor in assessments, with older homes that have not been assessed for some time seeing a bigger change in values than newer homes that have been assessed more recently.

He also said that 68 tax appeals have been made in the last year, and a greater number of appeals and the greater amount of refunds the township is forced to make the more it hurts taxpayers as a whole.

Making these refunds, Hall said, means the township has less money with which to provide services.

Woodruff also noted that there have been some recent moves in the legislature to change laws which cause municipalities to bear the total costs of refunds without having the two other recipients of property taxes-school districts and counties-sharing in these costs.

Allen confirmed there have been some suggestions in the legislature to change the system but they have not gotten very far.

The mayor said this may be due to the fact that school districts and counties make the claim that they have no say in the tax appeals process.

Redoing the township maps may take some time, said Edgar, noting that updating maps in Kinnelon, where he also served as assessor, took one and a half years.

In response to a question from Woodruff, Allen noted that, if Berkeley Heights qualifies for an order of revaluation, the township could take up to five years to pay off the cost of performing the revaluation.

As far as the cost of revamping the maps, Edgar said Kinnelon, which is not as large as Berkeley Heights, but needed more work on its maps, paid $128,000. He added that Berkeley Heights would probably not have to redo its block and lot designations to the extent this was done for Kinnelon.

On another question, Allen told Councilman Marc Faecher that, once the initial revaluation is done, only about 25 percent of the township’s 4800 properties would have to be reassessed in each of the following four years to maintain 100 percent of true market value.

He added that, if a fair mix of neighborhoods is selected for the yearly reassessments, attorneys for owners whose properties were not done would have no basis for claiming unfairness.

The tax expert also said that, if a municipality was due for revaluation, it was very difficult for residents to argue that a revaluation should not be performed.

On another matter, Faecher, who serves on a committee looking into Berkeley Heights’ obligations concerning affordable housing, noted the New Jersey Supreme Court recently interpreted the state constitution to again say there is a right to affordable housing in the state.

He noted that fair housing advocacy groups such as the Fair Share Housing Center and many builders can now file builders’ remedy suits to force municipalities to provide affordable housing within their borders.

Faecher noted, however, that, last year, estimates by affordable housing advocates placed Berkeley Heights’ fair share assessment of affordable housing at 631 units to be built, and that number was increased to 859 this year.

He also said that builders claim that they should be permitted to construct four market rate units for every affordable housing unit. That would place the requirement in Berkeley Heights at 4500 units.

The councilman said the township had to develop a plan that was fair and one which the court would accept to counter the arguments of builders and fair housing advocacy groups. Berkeley Heights, he said, needed to argue for a number somewhere between zero and 859.

If the township’s plan were to be validated by the courts, he added, this would isolate Berkeley Heights from attacks in builders’ remedy lawsuits.

The mayor said he expected a plan to be filed this July with a decision expected in November.

With many of Union County’s 21 municipalities filing plans at the same time, Woodruff added, a judge may say he could not make a decision in the cases.

Woodruff said it was up to township officials to consult with the township planner and its legal counsel using all the information available to make the best arguments it could at affordable housing hearings.

Responding to a question from Councilman Ed Delia, Faecher said there was nothing forcing the courts to take into account that township schools could not accommodate the number of new students generated by affordable housing obligations placed on the township.

Woodruff, noting that Governor Chris Christie, who, when running for his first term, said the quotas placed by the Council on Affordable Housing were unworkable, may see his statements come to fruition due to the latest court rulings.

On another matter, reporting on the Memorial Park restoration project, Councilman Craig Pastore said the project committee had met with the township business administrator and reviewed the planting plan while making improvement suggestions.

He said the committee also had asked for a sprinkler plans and had suggested a budget be drawn up for each of the plans and that an account be established to maintain the plantings for 20 years.

In addition, Pastore said, the Christmas or holiday tree currently on the Memorial Park memorial site would be moved to Peppertown Park before renovations to the memorial took place.

Woodruff said contributions could be made to the fund supporting the memorial by calling the municipal building or logging onto BHMemorialPark.com.

On another matter, council members disputed a contention by former councilman John Bonacci that they could have exerted much more effort to bring the projected 2015 budget increase below, what Bonacci said was 5.44 percent.

Council president Jeanne Kingsley said the budget was zero based, meaning “we don’t spend money until the department heads can justify every expenditure to us.”

She added there was very little of the budget that actually was within the council’s control.

Township chief financial officer Michael Marceau also said this year saw substantial increases in employee healthcare and pension costs, which caused the budget increase to go about the state “cap” on spending.

Kingsley and Hall also said that police salary increases, an item Bonacci said could have been examined for reduction, were part of contractual obligations to which the township was bound.

On another matter, resident Bill Mochado said the township “was being manipulated by big landowners” and was not doing enough to stop developments such as the CVS that was being built “right across the street from a Walgreen’s.”

Councilmen replied that township zoning laws do set certain requirements for development but members of the governing body could not regulate what a private landowner wants to do with his or her own land.

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