New Jersey-2014-S2908-Introduced

An Act concerning the assessment of real property in certain counties and amending various parts of the statutory law.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. N.J.S.40A:4-53 is amended to read as follows:

40A:4-53. A local unit may adopt an ordinance authorizing special emergency appropriations for the carrying out of any of the following purposes:

a. Preparation of an approved tax map or of annual tax map revisions in association with the implementation and continuation of the "Real Property Assessment Demonstration Program," P.L.2013, c.15 (C.54:1-101 et al.).

b. Preparation and execution of a complete program of revaluation of real property for the use of the local assessor, or of any program to update and make current any previous revaluation program when such is ordered by any county board of taxation, or to update and make current any reassessment, or other program, when such is ordered by the county board of taxation of a county operating under the "Real Property Assessment Demonstration Program," P.L.2013, c.15 (C.54:1-101 et al.).

c. Preparation of a revision and codification of its ordinances.

d. Engagement of special consultants for the preparation, and the preparation of a master plan or plans, when required to conform to the planning laws of the State.

e. Preparation of drainage maps for flood control purposes.

f. Preliminary engineering studies and planning necessary for the installation and construction of a sanitary sewer system.

g. Authorized expenses of a consolidation commission established pursuant to the "Municipal Consolidation Act," P.L.1977, c.435 (C.40:43-66.35 et seq.).

h. Contractually required severance liabilities resulting from the layoff or retirement of employees. Such liabilities shall be paid without interest and, at the sole discretion of the local unit, may be paid in equal annual installments over a period not to exceed five years.

i. Preparation of a sanitary or storm system map.

A copy of all ordinances or resolutions as adopted relating to special emergency appropriations shall be filed with the director.

(cf: P.L.2010, c.46, s.1)

2. Section 4 of P.L.2013, c.15 (C.54:1-104) is amended to read as follows:

4. a. There is established a real property assessment demonstration program, which shall be open for participation
therein to any county in the State, to evaluate the efficacy and functionality of a municipal system of real property assessment directed by a county tax board through the county tax administrator pursuant to a revised assessment, and assessment appeal, calendar.

A goal of the demonstration program is to demonstrate an enhanced system of municipal real property assessment as a complement to the county-based real property assessment system pilot program undertaken pursuant to the provisions of P.L.2009, c.118 (C.54:1-86 et seq.), under which the entire real property assessment function formerly performed by the municipal tax assessor, has been transferred to the county through the appointment of a county assessor and deputy county assessors. The existence of two programs under which the real property assessment function is performed using two different methods will allow the Legislature to evaluate the effectiveness of each system of real property assessment, and to determine whether the current statutory system of real property assessment function should be revised Statewide.

[For the first two full tax years immediately following the enactment of P.L.2013, c.15 (C.54:1-101 et al.), no more than two counties shall participate in the demonstration program established in this section, and for the third and fourth full tax years immediately following the enactment of P.L.2013, c.15 (C.54:1-101 et al.), no more than two additional] No more than 10 counties shall participate in the demonstration program established in this section. A county shall not institute a demonstration program pursuant to the provisions of P.L.2013, c.15 (C.54:1-101 et al.) unless it meets the following criteria, and provides the required information to the Director of the Division of Taxation and to the Director of the Division of Local Government Services:

(i) the county tax board by resolution, shall certify to the Director of the Division of Taxation and to the Director of the Division of Local Government Services that the county tax board has sufficient funds available to pay all of the costs associated with the demonstration program, including the conversion to the MOD-IV system and the associated expansion of the technology infrastructure to the municipalities in the county. The county tax board shall forward the resolution to the Director of the Division of Taxation and to the Director of the Division of Local Government Services;

(ii) the county is a State-certified MOD-IV vendor, or the county has contracted with a single State-certified MOD-IV vendor to provide MOD-IV technology to all of the municipalities in the county. The county shall provide a copy of its MOD-IV certification, or a copy of a valid contract for MOD-IV services;

(iii) the members of the county's assessors' association, by not less than 2/3rds of its voting membership, have approved the implementation of the demonstration program. The county tax board shall forward the resolution to the Director of the Division of Taxation and to the Director of the Division of Local Government Services.

b. There shall be no direct appropriation of State funds used to effectuate the provisions of the demonstration program established in subsection a. of this section. The technical costs of the demonstration program shall be paid by the county board of taxation using assessment appeal filing fees collected by the county board of taxation pursuant to section 18 of P.L.1979, c.499 (C.54:3-21.3a).

c. (1) Not later than September 1 immediately preceding demonstration program implementation, and using its own funds therefor, the county tax board of each demonstration county participating in the demonstration program established in subsection a. of this section shall provide MOD-IV and CAMA software to each municipality that does not use the software, at no cost to those municipalities, and shall provide, at no cost to those municipalities, training in the use of the software to the assessors of those municipalities, and to their respective staff members. Thereafter, each municipality shall pay an annual fee per each taxable line item in the municipality to the county tax board for the MOD-IV and CAMA service.

(2) On October 1 next following the provision of software under paragraph (1) of this subsection, each demonstration county shall commence the demonstration program under a plan developed by the county tax administrator of each demonstration county, approved by the county board of taxation, and submitted to the Director of the Division of Taxation and the Director of the Division of Local Government Services not less than 60 days prior to October 1. The Director of the Division of Taxation and the Director of the Division of Local Government Services shall not propose or require any changes to a demonstration program plan submitted by a county board of taxation unless a provision of the demonstration program shall be inconsistent with State law, or the decision of any court of this State, regarding the assessment of real property unless the changes have been agreed to by a majority of the members of a demonstration county's Assessment Demonstration Program Steering Committee created pursuant to paragraph (3) of this subsection. The demonstration program of each demonstration county shall operate under all statutory requirements and pursuant to all statutory dates and time frames concerning the assessment of real property in the State, as those statutory dates and time frames have been amended pursuant to the provisions of P.L.2013, c.15 (C.54:1-101 et al.).

(3) Each demonstration county shall establish an "Assessment Demonstration Program Steering Committee" to monitor and report on the activities within the demonstration county relative to the demonstration program. Members of the steering committee shall be the State Treasurer or his designee, the Director of the Division of Taxation or his designee, the Director of the Division of Local Government Services or his designee, a member of the County Assessor's Association of the demonstration county, and the county tax administrator of the demonstration county. Actions taken by the steering committee shall be approved by a majority of the members of the steering committee.

d. The Director of the Division of Taxation and the Director of the Division of Local Government Services shall, with the advice and the recommendations of the county tax administrator provide to the Governor and to the Legislature, not later than July 1 next following the fourth full tax year after the implementation of the demonstration program, a report detailing the experience of each demonstration county participating in the demonstration program, the successes of the program, any problems experienced under the program, and any recommendations for statutory or administrative changes to the current system of real property assessment in the State.

e. Under the demonstration program, each municipal assessor in a demonstration county shall utilize the same property assessment software as is used by the county tax board and provided to the municipalities by the county tax board pursuant to subsection c. of this section. All real property assessment functions required pursuant to State law, including the revaluation or reassessment of real property, as well as other assessment-based functions such as the development of a compliance plan, maintenance of assessments and the calculation of added assessments shall be performed using the property assessment software.

f. In accordance with the provisions of statutory law and with any rule or regulation promulgated pursuant thereto, at the beginning of the demonstration program in a demonstration county and reflected within the implementation plan, the county board of taxation [of a demonstration county] shall compel the implementation of a revaluation or reassessment of real property in any municipality in the demonstration county [at such time that the county board of taxation determines the need therefore]. Within a demonstration county, all municipalities shall perform annual reassessments. All annual reassessment programs shall be supported by a five-year program in which the inspection of the interiors of 20 percent of all parcels is attempted annually, so that each five-year cycle, 100 percent of the interiors of all parcels are attempted to be inspected. The county tax board shall determine if a municipality must first implement a revaluation before beginning its annual reassessment supported by 20 percent annual interior inspections. Prior to July 15^th of the year prior to the countywide implementation of the demonstration program, the county board of taxation shall determine if a municipality scheduled to implement a revaluation must¹ implement a traditional revaluation or begin the 20 percent interior inspection process, each year revising all assessments to the current director's ratio, so that in the fifth year, 100 percent of the interiors of all properties have been attempted to be inspected and 100 percent of the assessments have been revised to true value. In addition to the perpetual 20 percent annual interior inspection program, to ensure the accuracy of the market data utilized in the annual reassessment,the assessor may inspect the interior of any property for which a deed is filed. If a municipality fails to comply with a revaluation or reassessment, as appropriate, ordered by the county board of taxation in a timely manner, the county board of taxation shall cause the revaluation or reassessment, as appropriate, to be performed at the municipality's cost. The cost of a revaluation or reassessment, as appropriate, shall be directly billed to such a municipality, in addition to the apportionment valuation, through the adjustment of the county levy for that municipality pursuant to R.S.54:4-48 and R.S.54:4-49. A municipality feeling aggrieved by a decision of the county board of taxation to cause the revaluation or reassessment, as appropriate, to be performed at the municipality's cost may file an appeal of that decision of the county board of taxation to the Tax Court within 45 days of the approval by the Director of the Division of Taxation of the county tax board's order requiring the revaluation or reassessment, as appropriate.

g. The Director of the Division of Local Government Services in the Department of Community Affairs, and the Director of the Division of Taxation in the Department of the Treasury, shall have the authority to take any action as is deemed necessary and consistent with the intent of P.L.2013, c.15 (C.54:1-101 et al.) to implement its provisions, including but not limited to the authority to waive any provisions of statutory law and regulations that may be inconsistent with the intent or application of the provisions of P.L.2013, c.15 (C.54:1-101 et al.).

h. To make the demonstration program perpetual and to provide for tax map maintenance, if a municipality fails to annually submit a revised tax map to the county board of taxation, the board shall have the changes implemented and shall charge the cost of the service to the municipality by adding the cost to the debits and credits of the county levy apportionment pursuant to R.S.54:4-48 and R.S.54:4-49.

(cf: P.L.2013, c.15, s.4)

3. R.S.54:3-21 is amended to read as follows:

54:3-21. a. (1) Except as provided in subsection b. of this section a taxpayer feeling aggrieved by the assessed valuation of the taxpayer's property, or feeling discriminated against by the assessed valuation of other property in the county, or a taxing district which may feel discriminated against by the assessed valuation of property in the taxing district, or by the assessed valuation of property in another taxing district in the county, may on or before April 1, or 45 days from the date the bulk mailing of notification of assessment is completed in the taxing district, whichever is later, appeal to the county board of taxation by filing with it a petition of appeal; provided, however, that any such taxpayer or taxing district may on or before April 1, or 45 days from the date the bulk mailing of notification of assessment is completed in the taxing district, whichever is later, file a complaint directly with the Tax Court, if the assessed valuation of the property subject to the appeal exceeds $1,000,000. In a taxing district where a municipal-wide revaluation or municipal-wide reassessment has been implemented, a taxpayer or a taxing district may appeal before or on May 1 to the county board of taxation by filing with it a petition of appeal or, if the assessed valuation of the property subject to the appeal exceeds $1,000,000, by filing a complaint directly with the State Tax Court. Within ten days of the completion of the bulk mailing of notification of assessment, the assessor of the taxing district shall file with the county board of taxation a certification setting forth the date on which the bulk mailing was completed. If a county board of taxation completes the bulk mailing of notification of assessment, the tax administrator of the county board of taxation shall within ten days of the completion of the bulk mailing prepare and keep on file a certification setting forth the date on which the bulk mailing was completed. A taxpayer shall have 45 days to file an appeal upon the issuance of a notification of a change in assessment. An appeal to the Tax Court by one party in a case in which the Tax Court has jurisdiction shall establish jurisdiction over the entire matter in the Tax Court. All appeals to the Tax Court hereunder shall be in accordance with the provisions of the State Uniform Tax Procedure Law, R.S.54:48-1 et seq.

If a petition of appeal or a complaint is filed on April 1 or during the 19 days next preceding April 1, a taxpayer or a taxing district shall have 20 days from the date of service of the petition or complaint to file a cross-petition of appeal with a county board of taxation or a counterclaim with the Tax Court, as appropriate.

(2) With respect to property located in a county participating in the demonstration program established in section 4 of P.L.2013, c.15 (C.54:1-104), and except as provided in subsection b. of this section, a taxpayer feeling aggrieved by the assessed valuation of the taxpayer's property, or feeling discriminated against by the assessed valuation of other property in the county, or a taxing district which may feel discriminated against by the assessed valuation of property in the taxing district, or by the assessed valuation of property in another taxing district in the county, may on or before January 15, or 45 days from the date the bulk mailing of notification of assessment is completed in the taxing district, whichever date is later, appeal to the county board of taxation by filing with it a petition of appeal; provided, however, that any such taxpayer, or taxing district, may on or before April 1, or 45 days from the date the bulk mailing of notification of assessment is completed in the taxing district, whichever date is later, file a complaint directly with the Tax Court, if the assessed valuation of the property subject to the appeal exceeds $1,000,000.

If a petition of appeal is filed on January 15 or during the 19 days next preceding January 15, or a complaint is filed with the Tax Court on April 1 or during the 19 days next preceding April 1, a taxpayer or a taxing district shall have 20 days from the date of service of the petition or complaint to file a cross-petition of appeal with a county board of taxation or a counterclaim with the Tax Court, as appropriate.

Within 10 days of the completion of the bulk mailing of notification of assessment, the assessor of the taxing district shall file with the county board of taxation a certification setting forth the date on which the bulk mailing was completed. If a county board of taxation completes the bulk mailing of notification of assessment, the tax administrator of the county board of taxation shall within 10 days of the completion of the bulk mailing prepare and keep on file a certification setting forth the date on which the bulk mailing was completed. A taxpayer shall have 45 days to file an appeal upon the issuance of a notification of a change in assessment. An appeal to the Tax Court by one party in a case in which the Tax Court has jurisdiction shall establish jurisdiction over the entire matter in the Tax Court. All appeals to the Tax Court hereunder shall be in accordance with the provisions of the State Uniform Tax Procedure Law, R.S.54:48-1 et seq.

(3) Due to the restricted time to hear county tax board appeals within a demonstration county, in the event a hearing is adjourned by the county tax administrator for good cause shown, the evidence exchange window shall remain as seven days prior to the original hearing date.

b. No taxpayer or taxing district shall be entitled to appeal either an assessment or an exemption or both that is based on a financial agreement subject to the provisions of the "Long Term Tax Exemption Law" under the appeals process set forth in subsection a. of this section.

(cf: P.L.2013, c.15, s.9)

4. This act shall take effect immediately.

STATEMENT

This bill makes revisions to current law affecting the operation of the "Real Property Assessment Demonstration Program," P.L.2013, c.15 (C.54:1-101 et al.) (hereinafter "demonstration program"). That law created, as a demonstration program, a real property assessment system in which the county board of taxation, and its administrator, closely supervise and direct local assessors in their chief function, the assessment of real property for the purposes of local property taxation. The purpose of the system is to create a more responsive and accurate real property assessment function that annually adjusts to the flow of a county's varied real estate markets and submarkets, through a collaboration between the county tax board and municipal assessors, leading to a more accurate assessment process and a reduction in successful property assessment appeals. The changes to current law proposed in this bill would address issues that have arisen as the demonstration program has operated in the first county in which the county tax board has adopted its provisions, Monmouth County.

The bill would amend N.J.S.40A:4-53, which permits local units of government to adopt an ordinance authorizing special emergency appropriations for certain purposes, to clarify that the preparation of annual tax map revisions necessary for the implementation and continuation of the demonstration program, and also the preparation and execution of a reassessment program ordered by a county board of taxation participating in the demonstration program, are purposes for which special emergency appropriations may be utilized.

The bill would also amend section 4 of P.L.2013, c.15 (C.54:1-104), the statute that sets forth the general operation of a demonstration program, to permit no more than 10 counties to participate in the demonstration program. As originally enacted, for the first two full tax years immediately following the enactment of the "Real Property Assessment Demonstration Program," no more than two counties may participate in the demonstration program, and for the third and fourth full tax years immediately following enactment, no more than two additional counties may participate in the demonstration program.

The bill would also make two other amendments to that statute. Amendatory language would clarify that at the beginning of the demonstration program and reflected in the implementation plan, the county board of taxation must compel the implementation of a revaluation, or reassessment, of any municipality in the demonstration county, and thereafter, all municipalities in the demonstration county must perform annual reassessments, supported by a five-year program in which the inspection of the interiors of 20% of all parcels is attempted annually, so that within each five-year cycle, 100% of the interiors of all parcels will be attempted to be inspected. The county tax board would determine if a municipality must first implement a revaluation before beginning annual reassessment supported by 20% annual interior inspections. The county board of taxation would determine if a municipality scheduled to implement a revaluation must implement a traditional revaluation or begin the 20% interior inspection process, each year revising all assessments to the current director's ratio, so that in the fifth year, 100% of the property interiors have been attempted to be inspected and 100% of the assessments will be revised to true value. The bill also requires that in addition to the perpetual 20 percent annual inspection program, to ensure the accuracy of the market data utilized in the annual reassessment, the assessor may inspect the interior of any property for which a deed is filed. Also, to make the demonstration program perpetual and to provide for tax map maintenance, if a municipality fails to annually submit a revised tax map to the county board of taxation, the board shall have the changes implemented and shall charge the cost of the service to the municipality by adding the cost to the debits and credits of the county levy apportionment.

The bill also addresses the assessment appeal process in demonstration counties. The bill would amend R.S.54:3-21 to require that, due to the restricted time to hear county tax board appeals within a demonstration county, in the event a hearing is adjourned by the county tax administrator for good cause shown, the evidence exchange window remains as seven days prior to the original hearing date.