Township of West Milford v. Van Decker

POLLOCK, J.,

concurring.

We held in Murnick v. Asbury Park, 95 N.J. 452, 455 , 471 A.2d 1196 (1984), that Chapter 123 provides the exclusive remedy for property-tax discrimination except when there is a violation of constitutional rights. This case is that rare one in which Chapter 123 does not establish “both the right to and measure of relief.” Ibid. It presents an egregious case of discrimination. Ibid. The Court correctly finds unconstitutional the *366 practice of reassessing properties solely because those properties have been sold in the previous year. Ante at 357, 576 A.2d at 882. That practice is patently unconstitutional because it discriminatorily shifts the municipal-tax burden to new owners in the municipality, sometimes called “welcome strangers.” Thus, relief is available outside of Chapter 123.

I join in the Court’s affirmance of the Appellate Division’s declaration of the unconstitutionality of the challenged assessment. I disagree, however, with the dicta in the Appellate Division opinion “that in order for Chapter 123 to be implicated the taxing district must establish that there was no common level, and that the county board judgment was at a ratio which could not be justified within the confines of the assessment ratios of the taxing district.” 235 N.J.Super. 1, 16 , 561 A.2d 607 (1989). Because of the importance of tax relief to taxpayers and taxing districts, I believe that this Court should do more than simply state that “the Appellate Division’s discussion regarding procedural or burden-of-proof issues relating to Chapter 123 was not essential to its decision and clearly constituted dicta." Ante at 365, 576 A.2d at 886.

In restricting Chapter 123 to situations in which there is no common level, the Appellate Division reasoned that the Chapter “was not intended as a protective range for affirmative assessing practices by an assessor which would effectively preclude a reviewing tax board or Tax Court from affording a remedy or correcting assessments where a common level existed.” 235 N.J.Super. at 20 , 561 A.2d 607 . More to the point, the Appellate Division concluded that “in order for Chapter 123 to be implicated the taxing district must establish that there was no common level * * Id. at 16 , 561 A.2d 607 . In restricting recourse to Chapter 123 to those situations in which there is no common level of assessment, I believe the Appellate Division has misread the statute.

We held in Murnick that the Chapter 123 ratio “establishes a rebuttable presumption of the common level assessment,” *367 which can be overcome only by a showing that its application “would be ‘virtually confiscatory.’ ” 95 N.J. at 462-63 , 471 A.2d 1196 . That presumption applies whether the statute is imposed by the taxpayer or the taxing district.

The Appellate Division’s distinction between invocation of Chapter 123 by a taxpayer or taxing district contravenes the statutory language. The relevant provision states:

Whenever the tax court is satisfied by the proofs that the ratio of the assessed valuation of the subject property to its true value exceeds the upper limit or falls below the lower limit of the common level range, it shall enter judgment revising the taxable value of the property by applying the average ratio to the true value of the property * * *. [N.J.S.A. 54:51A-6a.]

Thus, the Tax Court must revise an assessment whenever it is satisfied that a property-tax assessment falls outside of the common-level range, whether the assessment is above or below that range. The statute does not distinguish between the taxing district and the taxpayer. Consequently, the Appellate Division erred in precluding recourse by a municipality to Chapter 123. True, Mumick involved a taxing district where there was no common level of assessment. 95 N.J. at 456 , 471 A.2d 1196 . Contrary to the Appellate Division’s conclusion, however, nothing in Mumick suggests that Chapter 123 should be restricted to situations involving the absence of such a level.

The Appellate Division dicta not only runs counter to the plain words of the statute, it could lead to bad assessing practices. A “common level” is that level of assessment toward which all properties in a municipality tend to gravitate. In re Appeal of Kents 2124 Atlantic Ave., 34 N.J. 21, 26 , 166 A. 2d 763 (1961). A municipality can produce a true common level only by diligently updating its assessment lists. The more haphazard the assessing practices, the less likely it is that the municipality will enjoy a common level of assessment. Instead, assessed-to-true-value ratios will be randomly disbursed over a broad spectrum, and will not converge on any discernible, unitary level. By restricting a municipality’s recourse to Chapter 123 to those situations in which there is no common level of assessment, the Appellate Division dicta unintentionally en *368 courages assessors to neglect their duty to keep tax rolls current.

Chapter 123 was enacted to simplify the process of ensuring equality in property taxation. In addition to relieving taxpayers’ burden of proof of discrimination, Murnick, supra, 95 N.J. at 462-63 , 471 A.2d 1196 , its ratio is useful as an assessing tool for taxing districts. If districts are diligent in updating tax rolls, the Chapter 123 ratio provides a useful benchmark of equality.

Before the enactment of Chapter 123, taxpayers were handicapped in trying to prove the common level in a municipality. Id. at 459 , 471 A.2d 1196 . Often a common level did not exist because the municipality did not use a consistent method of assessment. Ibid. If applied consistently by taxing districts, the Chapter 123 ratio will lead to a common level of assessment. Also, if the ratio was incorrectly calculated, a taxpayer may challenge it in the Tax Court. Id. at 464 , 471 A.2d 1196 . Consequently, I would reject the Appellate Division’s dicta concerning Chapter 123.

Justice CLIFFORD joins.