A Property Tax Trifecta

It’s been a big week for taxpayers in New Jersey - three significant property tax cases came down from the courts in the last week. First, the Appellate Division granted a property tax exemption to the operators of an upscale restaurant on a university campus, reversing the Tax Court’s decision below granting summary judgment to the municipality. A published opinion involving a tax case is rare; one reversing the Tax Court even more so, so it’s worth taking notice. It’s interesting to see the Appellate Division balancing the interests between state higher education and the needs of local government. 

Next, the Tax Court re-affirmed the protections afforded by the Freeze Act, ruling that a sale of the property was not grounds for finding a change in value that would void the Act’s protection per se. As in many cases, some of the most interesting comments are reserved for footnotes. It’s good that taxpayers can rely on the Freeze Act with confidence, particularly given the rise in rolling reassessments and more frequent revaluations. If the Act applies, the town really has a hurdle to get over to prevent its application.  

Finally, the Tax Court gave a massive reduction in assessment to the owners of a former corporate headquarters, finding that the property wasn’t special use and could be valued as a single-tenant office building. It goes to show that if you can bring the court with you in your highest and best use determination, you have a good opportunity to win your case. It reminded me of a similar case with far more divergent opinions of highest and best use involving a Jersey Shore hotel. Curious folk can read that case here. 

What does all this mean? Call me biased, but I think it means it’s a good time to make sure you’re only paying your fair share of New Jersey property taxes.

Here are the opinions:

Gourmet Dining, LLC v. Union Township et al

160 Chubb Properties LLC v. Township of Lyndhurst

ML Plainsboro LTD Prntshp/Gomez v. Township of Plainsboro