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February  22

Fun With Taxes

We'll dispense quickly with the boring part: Montclair has picked Appraisal Systems of Mendham to do its property revaluation, due next January.

Now the fun part. Watch the screaming, recriminations and legal threats when many homeowners discover that their already stratospheric tax bills are going to go up. From today's Ledger:

The outcome will be something to watch: The 2004 analysis -- gleaned from records for 2000 to 2003 -- found that 79 percent of Montclair homeowners could see their tax bills change $500 or more in either direction, with some swings in the extreme as high as 30 percent.

Montclair, bracing for the revaluation, formed the Fair Valuation Task Force to be on the forefront of communicating with the public [emphasis ours] about what's ahead.

(We pause to snicker.)

An investigative report by the Star-Ledger in the summer of 2004 found that "three-quarters of black homeowners -- but only 1 in 5 white homeowners -- lived in neighborhoods where assessments were too high." And you know what that means. It's the latte-swiggin', SUV-drivin', granite countertop installin' folks who are going to see their property values (and taxes) go up. Social justice be damned. It ain't going to pretty.

Add this to the fun. The whole process goes transparent with Zillow.

February 22, 2006 in Scooped by Phil Read, Again | Permalink


Until New Jersey finds an alternative method to pay local school budgets property taxes will continue to rise.

Within Montclair approximately fifty percent of the township's budget is atributed to the school budget.

Posted by: Franklin | Feb 22, 2006 9:12:21 AM

"Watch the screaming, recriminations and legal threats when many homeowners discover that their already stratospheric tax bills are going to go up."

But some residents' tax`bills are going to come down, or don't the people in those neighborhoods count?

The longer that re-evaluation is posponed, the worse doing a new one gets. The worse that it gets, the more reluctent elected officials are to call for a doing new one, so it gets posponed even longer, making it even worse when it is finally done. Its neither the county's nor the state's fault that Montclair hasn't done a re-evaluation in 16 years.

Perhaps the town could set up a schedule to do re-evaluations at regular intervals. This would make the re-evals less painful, and make it less political.

PS. According to the Star Ledger, my block is slightly under-assesed.

Posted by: Bitpusher | Feb 22, 2006 9:18:30 AM

Bitpusher, what in the Ledger article brings you to that conclusion about your house?

Posted by: latebloomer | Feb 22, 2006 9:41:36 AM

Could "Hands Across Upper Montclair" be too far behind?

Posted by: Lisa | Feb 22, 2006 9:47:30 AM

take Park St in up. montclair, the last 2 blocks near Mt. Hebron, for example. If you used the "tax assesment viewer" that was posted on baristanet a few weeks ago, you could check out what people's home were assesed at. There wasn't a house assessed over 350k on that list, yet I think you would be extremely hard pressed to find a home on that street for twice that amount. It's obviously not just park st.

Posted by: realhawker | Feb 22, 2006 9:52:55 AM


The assessed rate is not the market rate. The two things are distinct.

Posted by: Right of Center™ | Feb 22, 2006 10:02:01 AM

"Bitpusher, what in the Ledger article brings you to that conclusion about your house?"

A while back, the Star Ledger had an article on property tax evaluations in various towns. They showed examples of houses that sold for the same price in the same town that had widely different tax bills. The article had maps of three towns, among them Montclair, which showed their estimate of how badly each block was over or under assessed. As I recall, the Fourth Ward was almost entirely over assessed, as was the section of the First Ward near Tuers Park and Alexander Avenue. The Second Ward was mostly under assessed. Most of the Third Ward was either slightly under or slightly under assessed.

Unfortunately, the map was not put into the on-line edition, so you will have to go to the library to get the particulars.

Posted by: Bitpusher | Feb 22, 2006 10:08:42 AM

Right of center, you are right the assessed rate is not the market rate, but it will be after the revaluation. (or at lease close to market rate). Montclair has not had a revaluation since 1989 and the current assessed rates were accurate back then. Many Montclair homeowners will see their assessed rates double and even triple after the revaluation. Taxes will not double and triple though, because the tax rate will decrease. My guess is that the new tax rate will be about 50-60% of what it is currently. Most people that bought a home in Montclair pre-1989 has seen their home value go through the roof, some more than others depending where it is located. Montclair needs this revaluation. It will definately help to make sure that everyone is paying their fair share of the overall tax burden.

Posted by: Taxman | Feb 22, 2006 10:30:20 AM

So - people are gonna throw a fit about having to pay what they rightfully OWE? The ones who should be complaining are the ones who have been overpaying for years! They should get a refund!

Posted by: Butch | Feb 22, 2006 10:36:59 AM


Yes. For a snapshot of time the two will coincide and then immediately diverge again. The assessed value will (again) remain fixed and then the "Director's Ratio" will again be applied. So at all times *except* the point of reevaluation the two figures are different.

So, yes, you are correct. But it is important to remember (as you say) that the only way your tax will go up is if, relative to the township as a whole, the value of your house has increased *more* in value than the baseline for the town.

Posted by: Right of Center™ | Feb 22, 2006 10:51:36 AM

Butch, If you or anyone thinks they are overpaying, you need to file an appeal. You know nobody is getting a refund, this ain't the IRS. The ideal model would be having every home revaluated every year or two, so values would always be current, but that is just not possible given the cost to the township to do the revaluation(Almost $1,000,000)

Posted by: Taxman | Feb 22, 2006 10:55:13 AM


People always "throw a fit" about taxes and spending when the cost is made clear to them. Thus the need for the complicated "shell game" which disguises taxes and keeps as hidden as possible the "bite".

Consider Corzine's new proposed "gross receipts tax" on *businesses*. Your average NJ taxpayer sighs in relief that *they* won't have to pay this universal tax applied to all goods and services sold in New Jersey because the *business* will have to write the check. Confident are these people that none of the tax will be passed along to them in the form of higher prices.

Posted by: Right of Center™ | Feb 22, 2006 10:58:08 AM

Yes, you are right - Unfortunately it will be only for a snapshot, especially when you consider how the Real Estate market has acted in recent years.

Posted by: Taxman | Feb 22, 2006 10:58:54 AM


does that million include the defense of the lawsuits?

Posted by: Right of Center™ | Feb 22, 2006 10:59:00 AM

How are the assessors going to get inside every single property? Are people legally required to let them in, and if not, how will they make sure this process is fair to everyone?

Also, does anyone have any info on how neighborhood comps factor in? One super-renovated house on my modest, highly-trafficked block sold for an astronomical figure last year, in a bidding war to clueless out of towners. Will this hurt the rest of us who live here in relative squalor?
And lot size? Is a tiny house on a huge lot "worth" more than a lovely house on a smaller plot of land? What about proximity to a busy school? Lots of questions...Thanks for any feedback.

Posted by: newandconfused | Feb 22, 2006 11:01:42 AM

I don't think you are obligated to let them in, but it is probably in your best interest to do so. Remember there is also a record of improvements in the form of permits available.

Posted by: Right of Center™ | Feb 22, 2006 11:05:15 AM

I'd be pretty pissed if my taxes went up 30% and my realtor didn't warn me about this possibility before I bought the house last year.

I'd be even more pissed with our electorate for dragging their feet on the revaluation. If my taxes go up 30%, the value of my house probably goes down $100,000. Shame on them. Depressed taxes on certain houses probably fueled higher prices which results in even higher taxes.

Why would these boobs wait so long to correct this mess.

Posted by: OX | Feb 22, 2006 11:52:50 AM

"I'd be even more pissed with our electorate for dragging their feet on the revaluation."

A truer malapropism has scarce been spoke!

Posted by: Right of Center™ | Feb 22, 2006 11:56:54 AM

p.s. price has little to do with taxes. It is the *relative* value.

Posted by: Right of Center™ | Feb 22, 2006 11:59:48 AM

A perhaps-related point: One year ago this week, the Supreme Court began hearing arguments in Kelo vs. the City of New London.

Posted by: cathar (8T) | Feb 22, 2006 12:10:14 PM


to comment further about the values...

My home, which I bought last year, is assesed at half the value of its purchase price...

so lets say I bought it at 400k its worth 500k now(with some major work done, etc...)

It was assesed at 200k before I bought it and still is today. (0% tax increases notices in the mail, I still have them!) I pay around 8k in taxes.

The house that's worth 1.4M but is asessed at 350,000, what do they pay in taxes? It doesnt seem a proportionate rate?

What do you think?

Posted by: realhawker | Feb 22, 2006 12:45:26 PM

OX wrote: "Why would these boobs wait so long to correct this mess."

Almost every town waits as long as they can between revaluations, mainly because of the cost which in itself raises taxes (the million dollars didn't fall from the sky)and also because it's always a mess. Most people really do not understand how the tax rate is calculated and assume that if their assessed value goes up, which virtually every home in Montclair will, their taxes will go up and that's not true. The fact is that about 33% on the homeowners will see thier taxes go up, 33% will stay the same, and 33% will actually go down. This is not just lip service that you hear from the Town. Call any appraisal company, most will take the time to talk to you and explain the 1/3, 1/3, 1/3 estimate. There is data to support this. The town will not be gaining any revenue by the revaluation, just distributing the burden more fairly. It's not perfect, but it is the best way to do it. Anyone that wants to challenge their new assessed value can do so, I'm sure once the revaluation starts we will all be getting junk mail from tax attorneys selling their wares about how they can lower your taxes. Be careful, if you appeal and lose your taxes can go up!

Posted by: Taxman | Feb 22, 2006 1:25:28 PM


I think it is time for a reevaluation.

I am guessing that if your home is worth 500K and you pay $8k in tax, your tax bill will go up. The tax bill on the $1.4 million dollar house will go WAY up.

Also someone paying $8k on a house worth 350k will go down.

(I'm guessing)

Posted by: Right of Center™ | Feb 22, 2006 1:32:45 PM

Welcome to the club.
>How are the assessors going to get inside every single property? Are people legally required to let them in, and if not, how will they make sure this process is fair to everyone?

Nutley recently completed its house-by-house reval. Belleville's is underway.
Nutley has begun sending out letters saying what the new assessment is.

We won't know whether or not the new assessment will bring higher, lower or even taxs until the new tax rate is struck on the entire township and county.

I couldn't be sure if my assessment is fair unless I saw my neighbor's similar house assessment and put all the figures into a crystal ball.

In answer to your question, if you don't let the fellow in to look at your house (in our case it was less than ten mintutes) he will GUESS that you have 35 golden bathrooms, finished basements and attics and several elevators, a black horse and a cherry tree - all to be assessed proportionately.

Posted by: Uncle Tonoose | Feb 22, 2006 1:43:22 PM

ROC, I agree.

I expect it to go up some.

Hopefully this increased tax will help the school system.

Posted by: realhawker | Feb 22, 2006 1:47:08 PM

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