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The Bergen County Board of Taxation recognizes recent changes in the appeal
process have made procedures more complex. This presentation was developed as an
aid to the property owner, but it should not be considered as an all inclusive
guide . Most importantly, it is essential taxpayers understand they must prove
their assessment is unreasonable compared to a market value standard. Your
current assessment is by law assumed to be correct. You must overcome this
presumption of correctness to result in an assessment change.

What is the basis for my assessment?

In order for an assessment to be deemed excessive or discriminatory, a
taxpayer must prove an assessment does not fairly represent one of the two
standards:

• Following a revaluation, all assessments must represent 100% of true market
  value as of the previous October 1. The October 1 pre-tax date is called the
  annual “assessment date”. All evidence submitted in a tax appeal must be on or
  near the assessment date, especially property sales used as comparables.
  
• The other standard is the “common level” or common level range established
  in your municipality. To explain the common level range you must consider what
  happens following a revaluation. or reassessment. Once a revaluation or
  reassessment is completed, external factors such as inflation, appreciation, and
  depreciation may cause values to increase or decrease at varying rates.
  

Other factors such as physical deterioration may contribute to changes in
property values. Obviously, if assessments are not adjusted annually, a
deviation from 100% of true market value will occur.

The State Division of Taxation annually conducts a fiscal year sales survey,
investigating most property transfers that occur in your community, with your
local assessor assisting. Every sale is compared individually to every
assessment to determine an average level of assessment in a municipality. An
average ratio is developed from a sampling of property sales to represent the
assessment level in your community. In any year, except the year a revaluation
or reassessment is implemented, the common level of assessment is the average
ratio of the district in which your property is situated and is used by the Tax
Board to determine the fairness of your assessment. The sales ratios are
reviewed inter and intra for each municipality.

How do I know if my assessment is fair?

The New Jersey Legislation adopted a formula known as Chapter 123 in 1973 to
test the fairness of an assessment. Once the Tax Board has determined the true
market value of a property during an appeal, they are required to automatically
compare the true market value to the assessment. If the ratio of the assessment
to the true value exceeds the average ratio by 15%, then the assessment is
automatically reduced to the common level. However, if the assessment falls
within this common level range, no adjustment will be made. If the assessment to
true value ratio falls below the common level, the Tax Board is obligated to
increase the assessment to the common level. This test assumes the taxpayer will
supply sufficient evidence to the Tax Board so they may determine the true
market value of the property subject to the appeal. You should inquire into your
district’s average ratio before filing a tax appeal. This ratio changes annually
on October 1, for use in the subsequent tax year.

What is a tax appeal hearing and who will hear my
appeal?

Once you have filed your tax appeal, a hearing before the Bergen County Tax
Board is scheduled. The Bergen County Board consists of 5 members appointed by
the governor. The Tax Board Commissioners are appointed primarily to hear
disputes involving assessments. The municipality is the opposing party and will
be represented by the municipal attorney. The assessor and/or an appraiser may
appear at your hearing as an expert witness for the municipality.

Is a hearing always necessary?

A hearing is always necessary. If the assessor, municipal attorney, and the
taxpayer agree to a settlement or the issues are otherwise resolved, it may not
be necessary for you to attend your hearing, particularly if a settlement
stipulation form is submitted to the Tax Board for their approval.

When are the tax appeal hearings held?

Tax appeal hearings are generally held after the April 1 annual
deadline. Adjournments are generally denied. It is suggested that you make
every attempt to attend your hearing. If you miss your hearing and have not
received a written notice postponing your case, you may assume the case has been
dismissed. If you do not attend your hearing, your case will be dismissed “for
lack of prosecution.”

What is good evidence to convince the Tax Board to reconsider an
assessment?

You cannot appeal the taxes on your property since the taxes are the result
of the local budget process. You must pay the collector all taxes and municipal
charges up to and including the first quarter of the tax year. Remember, the
burden is on you, the appellant, to prove your assessment is unreasonable,
excessive, or discriminatory. It is necessary for you to prove at the onset that
your assessment is in error. It is also necessary for you to suggest a more
appropriate value.

The taxpayer must be persuasive and present credible evidence. Credible
evidence is evidence supported by fact, not assumptions or beliefs. Photographs
of both the subject property (the property subject to the appeal) and
comparables are useful in illustrating your argument. Factual evidence
concerning special circumstances is necessary. For example, if the property
cannot be further developed for some reason, evidence must be provided.

The most credible evidence is recent comparable sales of other properties of
a similar type in your neighborhood. Remember, if you are going to discuss
comparable sales, not less than three comparable sales shall be submitted to the
Assessor, Clerk, and County Tax Board, not less than one week prior to the
hearing if not included with the petition of appeal. Sales of all properties
(SR-1A’s) are available for your review at the County Tax Board. Comparable
means most of the characteristics of your property and the neighboring sale is
similar. You should be knowledgeable of the conditions of the sales you cite
including financing and be able to give a full description of the properties.
Some of the characteristics making your property comparable are: recent sale
price, similar square footage of living area measured from the exterior, similar
lot size or acreage, proximity to your property, the same zoning use (e.g.
duplex in a duplex zone), and similar age and style of structure, etc.

If the property was recently purchased, how is this purchase
considered?

An assessment is an opinion of value. Uniformity of treatment dictates minor
adjustments are not made simply due to a recent sales price. For various other
reasons the subject’s sales price may not necessarily be either conclusive
evidence of the property’s true market value, or binding upon the Tax Board. An
examination of the circumstances surrounding a sale is always important.

Will the appeal be private?

No. All meetings of the Board of Taxation are public meetings.

Are there special rules for commercial
properties?

Yes. Owners of rental income properties must supply an income statement at
the time of filing on special forms provided by the Tax Board. Since the income
generated by a property has a direct bearing on the owner’s ability to market
the property, and therefore its value, this evidence may be useful in arguing
both sides of an appeal.

Who is an expert witness?

Besides your municipal assessor, anyone whose occupation is a real estate
appraiser, and whose designation as such is from a legitimate association of
professionals, is considered an expert. An expert’s qualifications may be
challenged by the municipal attorney at the hearing.

In addition, if you intend to rely on expert testimony at your hearing, you
must supply one copy of an appraisal report to the assessor, and one copy to
every member of the County Tax Board and Tax Administrator at least 7 days in
advance of the scheduled hearing. The appraiser who completed the report must be
available at the hearing to give testimony and to afford the municipality and
Tax Board an opportunity to cross-examine the witness.

May I further appeal the judgment of the Tax
Board
if I am still dissatisfied?

If you are dissatisfied with the judgment rendered by the Tax Board, you will
have 45 days from the date your judgment was mailed to file a further appeal
with the Tax Court of New Jersey. If your property is assessed for more than
$750,000, you may file directly with the Tax Court by April 1st annually.

In Summary

A taxpayer filing an appeal should consider the following questions.

1. What was the market value of my property of the pretax year?
   
2. Can I support my conclusion of market value with credible evidence?
   
3. Is my property assessed in excess of its market value if a
   reassessment/revaluation was implemented in the current tax year? If a
   revaluation/reassessment was not implemented, does my assessment exceed market
   value or does the ratio of my property assessment to its market value exceed the
   upper limit of the common level range?

For additional information, or to request tax forms, call the Bergen County
Board of Taxation at 201-336-6300 or write:

Bergen County Board of Taxation
Administration Building
One Bergen
County Plaza, Room 370
Hackensack, NJ 07601-7000

Visit the Bergen County Board of Taxation’s web site at www.co.bergen.nj.us/taxboard.