In many N.J. towns that undergo revaluations, homeowners end up paying more open space taxes

The second NJ.com editorial that caught my eye today was about how NJ open space taxes are effected when municipalities undergo revaluations like Middletown has. Open space taxes are tied into property values and increase proportionally to the value of a property after a revaluation.

I remember during last year's budget introduction meeting in Middletown, a gentleman brought up this issue and wanted the Township to adjust the rate downward to offset the 14% tax increase which was contained in the budget. I believe his request fell on death ears and nothing was done to make adjustments to the open space tax:

In the nation's most densely populated state, Garden State residents value their space.

But they may not be so thrilled about what they are paying for it. The reason is a tiny municipal tax for open space — pennies per $100 of a home's valuation — that, left unchecked, has added up to big bucks in some towns.

The result is homeowners in 50 New Jersey towns have paid out some $15 million more to preserve land, farms and historic and recreational sites than they had in previous years. In one town last year, the tax bills jumped by more than $150 for some homeowners.

The quirk comes into play when towns conduct revaluations. The problem is towns — which make adjustments to prevent other slices of the tax pie from skyrocketing — fail to do the same for the open space tax. Because that tax's rate is tied to property values, the levy goes up when properties appreciate.

The longer a town goes between revaluations, the more homes are worth and the bigger the bite taken by the open space tax. Last year, for example:

• In Roseland, which underwent a revaluation for the first time since the Nixon administration, the average property assessment climbed 651 percent. That jacked up the open space tax from roughly $25 to nearly $200 for the owner of a home assessed at the borough's average of about $481,000. The Essex County town's open space tax levy surged from nearly $95,000 to almost $727,000.

• In Brick, what had been an open space levy of more than $471,000 ballooned by 127 percent to more than $1 million after a revaluation in that Ocean County township.

• In Princeton Borough, leaders tried to avoid a tax hike by spending surplus funds and not replacing several departing workers. But the open space rate wasn't adjusted before the Mercer County borough's revaluation, and it raised that part of the average tax bill by $40 from the year before.

"Maybe some people are asleep at the switch," said Ulrich H. Steinberg, a former director of the state Division of Local Government Services, which provides management and fiscal advice to municipalities. "(Officials) may see the numbers, but they may not understand what the numbers mean. They may not be looking out for what the overall impact is on the residents."

Over the last five years, 71 New Jersey towns with open space taxes underwent property revaluations. Nearly three-quarters of them failed to adjust their open space tax rates, leading to a 128 percent increase in their combined levies — a windfall of more than $15.5 million. By contrast, municipal taxes in those towns rose an average of 12 percent....

Read more >>> Here and find out exactly "WHAT IS A MUNICIPAL OPEN-SPACE TAX?"