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January 7, 2014

RE: Action Needed on Verizon Business Personal Property Tax Issue

Dear Mayor:

On behalf of local officials and property taxpaying residents all around New Jersey, we want to express our gratitude to Senator Bob Smith and Assemblyman Ralph Caputo for sponsoring companion bills S-2324/A-3393 during the 2012-2013 Legislative Session. We, also, thank their co-sponsors, Senators Linda Greenstein, Shirley Turner, Joseph Vitale and James Holzapfel and Assemblymen Reed Gusciora and Joseph Egan. We strongly support this initiative, which would clarify the responsibility of certain telecommunications corporations to continue to remit Business Personal Property Tax (BPPT) payments to municipalities. We regret that the bills were never posted for consideration by, respectively, the Senate Community and Urban Affairs Committee and the Assembly Telecommunications and Utilities Committee.

Respectfully, we have asked the sponsors to re-introduce the bills for consideration during the 2014 Session of New Jersey Two Hundred Sixteenth Legislature.

In October, 2012, the Appellate Court 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 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 a local telephone exchange. Verizon’s claim had been rejected by the Mercer County Board of Taxation in 2009. The Tax Court reversed that ruling and allowed Verizon to claim the exemption. The Appellate decision permitted that interpretation to stand. Subsequently, the State Supreme Court also declined to take up the matter until all Tax Court proceedings were completed. Absent action by the State Legislature, that could postpone the delivery of these municipal revenues for years.

In response to that, S-2324/A-3393 were introduced, in order to 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 supports this initiative. We hope to be able to help to advance the bills, as soon as possible. Please contact your State Senator and your representatives in the General Assembly and ask them to join in this effort.

If you have any questions, please contact Jon Moran at 609-695-3481, ext. 121 or

Very truly yours,

Hon Brian Wahler, Mayor,
Piscataway; 3rd Vice President, NJLM; 
and Chairman, NJLM Telecommunications Task Force

William G. Dressel, Jr.
Executive Director





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