407 West State Street, Trenton, NJ 08618 (609)695-3481  NJLM logo 
 William G. Dressel Jr, Executive Director - Michael J. Darcey, CAE, Asst Executive Director

League of Municipalities/Association of Municipal Assessors of New Jersey Position Statement Before the Joint Legislative Committee on Constitutional Reform and a Citizens Convention
Thursday, September 7, 2006
1:00 p.m.
Committee Room 11


The New Jersey League of Municipalities ("League") and the Association of Municipal Assessors of New Jersey ("AMANJ") respectfully submit the following statement relating to its planned testimony before the Joint Legislative Committee on Constitutional Reform ("Joint Committee") scheduled for Thursday, September 7, 2006 at 1:00 p.m. in Committee Room 11.

The League and the AMANJ are very respectful of the daunting task faced by the Joint Committee as it considers potential structural reforms to the New Jersey Constitution relating to real property taxation. At the outset, the League urges the Joint Committee to be very mindful of the nuances and complexity of any revision of the constitutional provisions controlling real property taxation in New Jersey. It is the League's belief that there is no simple panacea or "magic bullet" which can solve the current real property taxation dilemma in this State. Literally every single concept that the Joint Committee has dealt with in a preliminary fashion up to this point has multiple impacts, many of them not immediately discernible. We will provide concrete examples of this reality through our testimony.

The League and the AMANJ come before the Joint Committee, at this point in time, with no specific reform or policy proposal. The League and the AMANJ would like the Joint Committee to accept its sincere offer to provide valuable resource assistance to the Joint Committee as it undertakes its review of proposed constitutional reforms. The League and the AMANJ may be moved at some point to take specific positions on concrete proposals ultimately submitted by or to the Joint Committee. For, now, through its membership and operating apparatus, the AMANJ and the League will be able to assist the Joint Committee in a unique way by providing the underlying data and information necessary to truly understand and analyze the various proposals which may come before the Joint Committee.

The beginning point of the analysis, as the Joint Committee has already identified, is the Uniformity Clause. Article 8, Section 1, paragraph 1, of our Constitution was the product of painstaking debate and analysis at our 1947 Constitutional Convention. The Uniformity Clause was born out of a history of preferential tax treatment existing at the time of the Convention, most particularly with regard to the railroad industry. The goal of the Convention was to ensure that, absent a specific and controlling Constitutional provision, all property in this State is uniformly valued and taxed. There are three critical phrases in Article 8, Section 1, paragraph 1, which resulted from this paramount goal of our Constitution's drafters:

  1. All property is to be assessed under general laws and by uniform rules;
  2. All property is to be assessed according to the same standard of value;
  3. All property is to be taxed at the general tax rate of the taxing district.

These misleadingly simple-sounding phrases have been the subject of almost 60 years of statutory implementation and judicial review. Beyond the literal meaning of these three phrases, the League wishes the Joint Committee to be especially mindful of the fact that this 60 years of jurisprudence has resulted in an incredibly intricate and interwoven real property tax assessment system built up upon the foundation of these three seminal phrases. The reason why any particular proposed reform will have rippling and perhaps unintended consequences is in part because of the sophisticated system that has developed over the 60 years since the Constitutional Convention. In our testimony we will provide some examples of this complexity as well as some examples of how a potential reform or revision of the seminal concepts could ripple through the existing system.

As an example, there already has been much discussion concerning the basis and practical operation of various tax exemptions and abatements which currently exist. To the League's earlier point, there is no simple broad stroke reform which can be implemented that does not have significant and perhaps unintended negative consequences. For while at first blush it appears that the existence of certain exemptions have the negative effect of reducing a tax base for a particular municipality or its related county, the existence of that exemption may well have significant positive economic and social consequences for the impacted municipality.

One procedural proposal the League can make at this point is for a reorganization and clarification of the current statute which controls many of the property tax exemptions in existence. N.J.S.A. 54:4-3.6 needs to be significantly reworked in a fashion which provides clearer and more definite standards for courts and ultimately municipalities to utilize when they are asked to analyze and take action on exemption applications.

We look forward to providing you with our testimony and answering any of your questions on Thursday September 7, 2006

William G. Dressel, Jr.
Executive Director
New Jersey State League of Municipalities 		Bernard Haney
President
Association of Municipal Assessors of NJ



 

 

 

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&nbs NJLM - League of Municipalities/Association of Municipal Assessors of New Jersey Position Statement
407 West State Street, Trenton, NJ 08618 (609)695-3481  NJLM logo 
 William G. Dressel Jr, Executive Director - Michael J. Darcey, CAE, Asst Executive Director

League of Municipalities/Association of Municipal Assessors of New Jersey Position Statement Before the Joint Legislative Committee on Constitutional Reform and a Citizens Convention
Thursday, September 7, 2006
1:00 p.m.
Committee Room 11


The New Jersey League of Municipalities ("League") and the Association of Municipal Assessors of New Jersey ("AMANJ") respectfully submit the following statement relating to its planned testimony before the Joint Legislative Committee on Constitutional Reform ("Joint Committee") scheduled for Thursday, September 7, 2006 at 1:00 p.m. in Committee Room 11.

The League and the AMANJ are very respectful of the daunting task faced by the Joint Committee as it considers potential structural reforms to the New Jersey Constitution relating to real property taxation. At the outset, the League urges the Joint Committee to be very mindful of the nuances and complexity of any revision of the constitutional provisions controlling real property taxation in New Jersey. It is the League's belief that there is no simple panacea or "magic bullet" which can solve the current real property taxation dilemma in this State. Literally every single concept that the Joint Committee has dealt with in a preliminary fashion up to this point has multiple impacts, many of them not immediately discernible. We will provide concrete examples of this reality through our testimony.

The League and the AMANJ come before the Joint Committee, at this point in time, with no specific reform or policy proposal. The League and the AMANJ would like the Joint Committee to accept its sincere offer to provide valuable resource assistance to the Joint Committee as it undertakes its review of proposed constitutional reforms. The League and the AMANJ may be moved at some point to take specific positions on concrete proposals ultimately submitted by or to the Joint Committee. For, now, through its membership and operating apparatus, the AMANJ and the League will be able to assist the Joint Committee in a unique way by providing the underlying data and information necessary to truly understand and analyze the various proposals which may come before the Joint Committee.

The beginning point of the analysis, as the Joint Committee has already identified, is the Uniformity Clause. Article 8, Section 1, paragraph 1, of our Constitution was the product of painstaking debate and analysis at our 1947 Constitutional Convention. The Uniformity Clause was born out of a history of preferential tax treatment existing at the time of the Convention, most particularly with regard to the railroad industry. The goal of the Convention was to ensure that, absent a specific and controlling Constitutional provision, all property in this State is uniformly valued and taxed. There are three critical phrases in Article 8, Section 1, paragraph 1, which resulted from this paramount goal of our Constitution's drafters:

  1. All property is to be assessed under general laws and by uniform rules;
  2. All property is to be assessed according to the same standard of value;
  3. All property is to be taxed at the general tax rate of the taxing district.

These misleadingly simple-sounding phrases have been the subject of almost 60 years of statutory implementation and judicial review. Beyond the literal meaning of these three phrases, the League wishes the Joint Committee to be especially mindful of the fact that this 60 years of jurisprudence has resulted in an incredibly intricate and interwoven real property tax assessment system built up upon the foundation of these three seminal phrases. The reason why any particular proposed reform will have rippling and perhaps unintended consequences is in part because of the sophisticated system that has developed over the 60 years since the Constitutional Convention. In our testimony we will provide some examples of this complexity as well as some examples of how a potential reform or revision of the seminal concepts could ripple through the existing system.

As an example, there already has been much discussion concerning the basis and practical operation of various tax exemptions and abatements which currently exist. To the League's earlier point, there is no simple broad stroke reform which can be implemented that does not have significant and perhaps unintended negative consequences. For while at first blush it appears that the existence of certain exemptions have the negative effect of reducing a tax base for a particular municipality or its related county, the existence of that exemption may well have significant positive economic and social consequences for the impacted municipality.

One procedural proposal the League can make at this point is for a reorganization and clarification of the current statute which controls many of the property tax exemptions in existence. N.J.S.A. 54:4-3.6 needs to be significantly reworked in a fashion which provides clearer and more definite standards for courts and ultimately municipalities to utilize when they are asked to analyze and take action on exemption applications.

We look forward to providing you with our testimony and answering any of your questions on Thursday September 7, 2006

William G. Dressel, Jr.
Executive Director
New Jersey State League of Municipalities 		Bernard Haney
President
Association of Municipal Assessors of NJ



 

 

 

Click Here to return to the League's Home Page