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January 16, 2013

RE: Supreme Court Punts on Business Personal Property Tax Relief Motion Legislative Action Is Needed

Dear Mayor:

We learned on Friday that the New Jersey Supreme Court has decided not to hear an appeal in a matter that will cost over 100 municipalities over $8 million in 2013, and which will cost more and more municipalities, more and more millions, with each passing year.

As noted in our October 2 letter (http://www.njslom.org/letters/2012-1002-verizon-v-hopewell.html), the Appellate Court had declined to review the June Tax Court preliminary decision in the case of Verizon v. Hopewell. The case, in which the League supported Hopewell as amicus curiae, involved Verizon’s claimed exemption from the Business Personal Property Tax (BPPT) in any municipality where the corporation unilaterally determines, in any given year, that it no longer supplies dial tone and access to at least 51% of the local telephone exchanges. Verizon’s claim had been rejected by the Mercer County Board of Taxation in 2009. The Tax Court reversed that ruling and awarded Verizon the exemption, pending further Tax Court litigation.

Remand of the case to the Tax Court will delay relief for New Jersey property taxpayers for years, while the Tax Court proceedings drag on.

Now more than ever, municipalities need to unite behind A-3393 and S-2324. As noted in our October 17 letter (http://www.njslom.org/letters/2012-1017-A-3393.html), this legislation will provide better direction to the courts regarding the legislature’s intent to protect residential property taxpayers, when laws regarding State taxation of telecommunications providers were reformed in 1997.

The League of Municipalities commends Assemblymen Caputo and Gusciora and Senators Smith, Greenstein and Turner for their sponsorship of these bills. We strongly support A-3393 and S-2324, which would clarify the law regarding payments of business personal property taxes by any local exchange telephone companies that, in 1997, served 51% of a municipality’s residents.

A-3393 has been referred to the Assembly Telecommunications and Utilities Committee, chaired by Assemblyman Chivukula. S-2324 is in the Senate Community and Urban Affairs Committee, chaired by Senator Van Drew. We have contacted the respective Chairs and asked for expeditious action on this matter. Please add your voices to ours.

Also, please contact your State legislators and urge them to support this clarification of the law. If you have any questions, contact Jon Moran at 609-695-3481, ext. 121 or jmoran@njslom.com

Very truly yours,

Brian Wahler
Mayor Piscataway
Member, NJLM Exec. Board
Chair, NJLM Telecommunications Study Committee
William G. Dressel, Jr.
Executive Director

 

 

 

 

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