- Property Taxes
- Property Tax in New Jersey
- Assessments & Property Values
Assessments & Property Values
New Jersey Statutory Law
The basic duty of an assessor is spelled out in New Jersey statutory law:
"The assessor shall...after examination and inquiry, determine the full and fair value of each parcel situated in the taxing district (the municipality) at such price as, in his judgment, it would sell for at a fair and bona fide sale by private contract on October 1 next preceding the date on which the assessor shall complete his assessments..." [CITE]
The assessor locates and causes to be mapped every parcel of property within the boundaries of the municipality. The assessor, by virtue of training or with the aid of a state-approved revaluation firm, values all of the property within the municipality at its "market value" as of October 1 of the year prior for the current tax year and assigns tax exempt classification when appropriate.
The New Jersey assessment system, as with most property tax systems in the United States, is an "ad valorem" system, which requires property to be assessed "according to its market value." Over the years various laws and regulations have been created to deal with the fact that maintenance of individual assessments through annual district-wide reassessments are not cost effective, and are more labor intensive than local governments can afford.
Prior to the 2008 recession the problem had been that certain sectors of the real estate market, such as residential property, were outpacing other sectors at break-neck speed. Another issue is that appreciation experienced in parts of a taxing district, such as the waterfront or the business district, can outpace other parts of the taxing district. Over time the disparity can become legally impermissible. The correction of this disparity within the district by means of a district-wide revaluation often leads to huge shifts in tax dollars. Cynical of the motives of the revaluation process, people often ask "what do you do with all of the extra money?" Factually, there is no extra money. For every dollar that someone pays in additional tax, there is a person within the district paying a dollar less in tax. Through the reassessment of all properties to their market values, the scales become balanced, and tax burdens are accurately reassigned.
The assessor is responsible for tracking the ownership and use of each individual parcel, and for providing that information to the rest of the municipal structure. As such, the assessor's records provide the foundation for all other municipal functions. All municipal functions including building permits, planning/zoning board applications, code enforcement, engineering, are driven by the block and lot parcel identifiers established and maintained by the local assessor.