SPARTA, NJ – Sparta Township has been told to go back to the drawing board and come up with a better way to deal with the Glen Lake Dam special assessment. On December 4, the ruling made Judge Stuart Minkowitz was received by the township attorney, Thomas Ryan of Laddey Clark and Ryan, LLP.
The judge found the township’s appointed expert’s methodology in developing the special assessment to be “arbitrary.” Further the judge said the township council’s decision to impose the special assessment was “misguided by an arbitrary and unreasonable expert report.”
The judge also found the “special assessment process was tainted by a fatal conflict of interest,” when Councilman Jerry Murphy voted on the resolution to approve the appointment of the commission that would develop the special assessment plan.
Murphy’s property is within the Glen Lake Beach Club.
“We are in receipt of Judge Minkowitz’s decision in this matter,” Sparta Mayor Gil Gibbs said. “The township is disappointed with the decision as we believe that we followed the established guidelines and practices in the application of the special assessments levied on the properties in Glen Lake. Having just received the decision today the governing body needs time to review it with the township attorney in order to fully evaluate the decision and what options there are for the municipality with respect to its implementation.”
Additional complaints about Open Public Records Act or OPRA were dismissed. The complaints about Open Public Meetings Act or OPMA violations were upheld though no penalty was incurred. The issues were related to conflicted councilman Murphy. When he recused himself in one instance, it left the council with less than a quorum and therefor no legal meeting.
The court concluded no action was taken at the meetings in question, council took steps to correct the OPMA violations by having proper meetings and the 45-day window for filing a complaint had passed.
Several residents of the Glen Lake Beach Club, located off Glen Road, filed litigation against the township challenging the special assessment as well as the commission appointed to develop the formula for the special assessment.
The Glen Lake Beach Club was required by the New Jersey Department of Environmental Protection to make repairs to the Glen Lake Dam. In order for the private, voluntary-membership lake association to receive a loan they were required to have Sparta serve as co-borrower, to assure repayment.
The loan was provided under the Dam, Lake and Stream Project Fund administered by the NJDEP. The township had to co-sign because it has the authority to collect a special tax assessment that would then be turned over to NJDEP to pay back the loan, according to statements made at the hearing for the establishment of the commission.
Sparta Township told the court they are only set up as a co-borrower to levy and collect the special assessment and pass on the repayment, as required by law. The township could also impose a lien on delinquent properties. The township was not to be spending public money on the project.
Through an ordinance on February 9, 2016 the township set up a Board of Assessment Commissioners who, together with consultant Scott Holzauer, was to determine the special assessment liability for the Glen Lake Beach Club property owners. The commission held hearing to get questions and comments from the affected residents.
Ultimately the commission determined 58 residents would be subject to the special assessment using documents presented by the Glen Lake Beach Club. Those residents would be further divided into three tiers based on the “views of the Lake from the property and the degree of accessibility to the lake” according to court documents.
The suit was filed because the residents claim the commission did not use “fair market value benefit analysis.” The commission used a map of the Glen Lake area and the Glen Lake Beach Club bylaws to determine the value derived from the lake for each resident, according to court documents.
The court found that the expert on whom the commission relied, did not provide a methodology for including the houses that were in the special assessment area, beyond eligibility for lake membership. The court found the township council’s decision to rely on the expert, arbitrary and unreasonable.
“We would again reiterate that the municipality is simply the ‘collection agent’ for repayment of the loan for improvements to the private community dam that were required by the state of New Jersey and that the lake association agreed to,” Gibbs said. “Further it is clear under the program that the private community was responsible for the repayment of the loan so that other residents of the municipality were not saddled with this financial responsibility.”
The council will be reviewing their options with Ryan according to Gibbs.