County rolls out new tax assessment program
'It makes for a ridiculously stable marketplace'
An innovative system of property tax assessment intended to prevent major spikes in individual homeowner’s taxes when properties are revalued is headed to Asbury Park and all other Monmouth County municipalities.
“It costs the city $265,000 every five to seven years for revaluation on the current plan,” said Asbury Park tax assessor Eric Aguilar [above] at Wednesday’s city council meeting. “Under the new plan, it would cost $20,000 every year, adding up to $100,000 over a five year period.”
Three main components of the new system change the way the current assessments function: a shift in the appeals calendar, annual assessment revisions and rolling inspections.
“It makes for a ridiculously stable marketplace across Monmouth County,” said Bernard Haney, Neptune Township’s tax assessor. “We are the first county in the state to move it forward.”
“It provides more up to date information and levels the playing field,” Aguilar said.
County tax administrators, the Monmouth County Tax Board and tax assessors in Monmouth all worked together to put the framework in place, he said.
The new process will start with assessments for the 2014 tax year.
“Simplistically, what happens is, every municipality in Monmouth will be revalued — Asbury is revaluing right now,” he said.
On the new system, all of the ratable entities in Asbury Park will be assessed at 100 percent of their current value by 2014. Moving forward, 20 percent of the properties will be inspected yearly, so every five years the entire city will be inspected. However, although 20 percent of properties will be assessed on a yearly basis, 100 percent of the properties will be revalued. Rolling inspections will allow assessors to monitor the market and change the values yearly.
Every five years the process starts all over again.
“It’s in everyone’s interest to have all values at 100 percent of values,” Haney said.
On the old system, assessments happened every 10 to 15 years, which made for large spikes in the amount individual homeowners had to pay since market conditions can change vastly over such a large span of time.
Haney referenced a large spike that happened in Ocean Grove in 2003, when the last assessment had taken place 15 years prior.
“The tax bills in Ocean Grove went from $3,000 to $15,000 on average,” he said. “In order to avoid those spikes, if we continue to adjust based on the market you stabilize your tax rate and get blips instead of big giant shifts.”
A shift in the appeals calendar from November to January is the final component of the new system.
Under the current tax assessment calendar, homeowners will receive new assessment postcards on or before November 15 with a filing deadline of January 15. Previously, postcards were mailed out on or before February 1 with an April 1 filing deadline.
The new system would also help ease the burden to municipalities when property owners appeal their assessments.
“The shift puts the assessment process prior to the budgetary process,” said Aguilar at last Wednesday’s city council meeting.
Anticipated but uncollected revenue due to loss in appeals between 2009 and 2010 was estimated at $119,090,263.00 statewide, according to a Aguilar. This forces municipalities to bear the brunt of lost earnings.
“Our last two appeals have been brutal for the city because our assessments were so off,” Aguilar said.
“[The calendar shift] ensures every tax appeal adjustment is already accounted for,” Haney said. “Under current system municipality is responsible for losses, in new system they are not. It stabilizes the ability to maintain the ratable base and keeps the entities on an even plane.”
The way Haney sees it, both the individual homeowner and the municipality win under the new system.
“The municipalities no longer have to shoulder the burden [for loss in appeal], and you end up with a more stable tax rate,” he said.
Councilman John Loffredo agrees.
“It’s pretty straightforward,” he said at the meeting. “It’s a great plan.”
————————————————————
Follow the Asbury Park Sun on Facebook and Twitter.
