HOWELL — The township’s plan to sell bonds and use the proceeds to refund $1.35 million in tax appeals to property owners is on hold.
The state Local Finance Board informed Howell municipal officials that the Attorney General’s Office has indicated that bonding is not permissible.
The Attorney General’s Office “has opined that towns may not borrow to obtain revenue foregone as a result of current year tax appeals,” said Lisa Ryan, a spokeswoman for the New Jersey Department of Community Affairs.
As a result, the Local Finance Board could not act on Howell’s application to issue bonds to repay taxes owed to property owners, she explained.
“The board does not have the lawful authority to let Howell do something that the law does not allow them to do,” Ryan said. “We have asked the Attorney General’s Office to reconsider their opinion, but unless they reconsider, Howell cannot be given the approvals they seek.”
Jeffrey Filiatreault, Howell’s chief financial officer, told Greater Media Newspapers he hopes the Local Finance Board will reconsider the township’s application at its meeting in October or November.
According to Filiatreault, Marc Pfeiffer, deputy director of the Division of Local Government Services, said he understood the bind some municipal officials are in as they face the reality of refunding property taxes following successful tax appeals.
“They are looking at addressing that,” Filiatreault said, referring to the borrowing restrictions. “That’s what I am led to believe.”
Pfeiffer made the comments during a seminar at the Government Finance Officers Association of New Jersey conference in Atlantic City last week, Filiatreault said.
The CFO said he is working on a contingency plan if bonding for the money that would be used to refund property taxes is not permitted by the state.