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BLOOMINGDALE - Revaluation looming, boro readies for tax appeals
(by Deborah Walsh - Staff Writer - October 15, 2008)
BLOOMINGDALE - The Borough Council expected to discuss last night whether it would be prudent to hire special legal counsel to handle tax appeals that may arise after a proposed property revaluation.
At the Sept. 23 Borough Council meeting, Borough Administrator Ted Ehrenburg proposed appointing Matthew J. O’Donnell of O’Donnell, McCord and DeMarco PC of Morristown as counsel for special litigation. O’Donnell serves as municipal tax counsel for more than a dozen towns.
Ehrenburg proposed that O’Donnell be appointed as special counselor for an upcoming property revaluation. O’Donnell’s office primarily handles property revaluations and contested property values, he said.
“A property reval doesn’t come often. The last one was in 1989. It’s a pretty intense project,” said Ehrenburg.
He said Donna Mollineaux, the borough’s chief financial officer, would like to get the reval project started. The first order of business is to get new tax maps. The old maps are from the 1960s, he said.
Councilwoman Linda Huntley indicated that she was under the impression that the borough’s tax assessor, Brian Townsend, would handle the appeals, not an attorney. If an attorney needs to be involved, Huntley asked why the borough’s attorney could not handle the appeals.
Borough Attorney Joseph MacMahon acknowledged that he and Townsend have handled past tax appeals.
Ehrenburg indicated that historically towns receive a much greater volume of tax appeals after a revaluation than in a normal year. The special counsel would be hired on a per diem basis and his services could be cancelled if it was determined that the services were not needed.
Paterson’s lawsuit calls for defense
Councilwoman Jennifer Altfield noted that the borough might need legal counsel for a lawsuit the City of Paterson has filed against the Passaic County Board of Taxation and 10 Passaic County towns including Bloomingdale.
In the suit, which was filed in August, Paterson contends that it is paying an unfair share of county taxes since it had a revaluation done in 2007 and many of the Passaic County municipalities have not completed a revaluation since the 1980s.
The suit is similar to one that Passaic County towns jointly filed against Paterson before it undertook its revaluation in 2007. Paterson had not undertaken a revaluation for 30 years and finally conducted its reval under a court order.
“Paterson needs to pay its freight. We may have to hire an attorney to protect us against this frivolous lawsuit,” said Altfield.
After MacMahon and Councilman Henry Slootmaker expressed confusion over the proposed agreement with O’Donnell’s firm, Ehrenburg proposed that the matter be discussed at last night’s (Oct. 14) council work session when there would be more time to go into detail.
Recommends going digital with tax maps
Back at a June 24 council meeting, Townsend discussed a property revaluation and revising the borough’s tax maps.
Though the tax maps are from the 1960s, Townsend said some revisions were made to the tax maps in the 1980s. Townsend said if the borough wants to pursue updating its tax maps, he would recommend it go with digital maps, which are more costly, but much easier to update.
He said the borough might also want to consider renumbering block and lot numbers because of the extensive amount of revisions, which would result in the block and lots not being in numerical order. Many lots have been merged, which causes the block and lot numbers to numerically jump all over the place, he said.
“The prevailing thought is why do it halfway? If you’re going to do it, do it correctly,” said Townsend.
Before the borough signs a contract with a property revaluation company, Townsend said it will be required to have new tax maps approved by the state Division of Taxation. The approval process could be lengthy because many municipalities will have maps being reviewed in Trenton, he said.
“I think you should start the map updating process in 2008 and start as soon as possible. You send the new maps off to the engineering department in Trenton and you think they’re perfect and they send them back all marked up for revisions,” said Townsend.
He said the new maps are anticipated to cost in the $70,000 to $90,000 range. Mollineaux indicated that the borough could pay for the maps over five years. A consensus of council members was that some funding should be allocated from the 2008 municipal budget to start the digital map revision process.
Townsend said there are only three or four firms that perform property reevaluations. It is anticipated that Passaic County will soon require the borough to conduct a revaluation. But even if the borough were ordered to do a revaluation today and solicited bids from firms, the revaluation probably would not get underway until 2010 because of the lack of revaluation firms, he said.
Townsend said currently five Passaic County towns are completing revaluations and 10 more will be required to conduct revaluations in the future. It has been speculated that the county has not ordered these 10 towns to complete revaluations because it is waiting for the real estate market to stabilize, he said.
Councilman Thomas Marinaro said some residents would be concerned that their taxes will go up when they hear a revaluation is taking place. Marinaro asked what residents could expect.
Townsend said some residents’ taxes will go up, some will go down and some will be stable. Currently, properties in the borough are assessed at roughly 40 percent of market value. If the average home is now assessed at $200,000 and $400,000 after the revaluation, a property owner’s taxes will stay about the same.
However, if the average home is assessed at $400,000 after the revaluation, but a property owner’s house is assessed at $500,000, then that property owner’s taxes will go up. If the average property is assessed at $400,000 after the revaluation, but a property owner’s house is assessed at $350,000, then the owner’s taxes will go down.
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