By STEVEN VIERA
Staff Writer
SOUTH RIVER — For the first time in 30 years, the borough may be required to conduct a property revaluation.
Under the authority of New Jersey’s Department of the Treasury, the state’s Division of Taxation will be holding a public hearing in South River to solicit feedback from residents as part of its investigation to determine whether or not the state should order a revaluation in the borough.
The hearing will take place at 6 p.m. on July 26 at the South River Veterans of Foreign Wars (VFW) building, which is located at 31 Reid St. The state is required by law to serve as the host to hearings such as these to gather input from the public when investigating the need for revaluations in specific municipalities.
“Senior Division personnel will conduct the meeting and will listen to what residents have to say about their experience in paying property taxes in the borough,” said Joe Perone, director of communications for the New Jersey Department of the Treasury.
Perone explained that South River has one of the lowest director’s ratios — which represents the relationship between the true value and assessed value of properties — in New Jersey. A director’s ratio below 85 percent is considered outside the state constitution’s mandate of uniform taxation, and South River, which has not conducted a revaluation in the past 30 years, has a director’s ratio of 30.82 percent.
“The 2015 true value of property in South River exceeds assessed value by $925.8 million,” he said.
According to Borough Administrator Frederick C. Carr, the average assessed home value in South River is $81,941.37.
“In 2012, I had spoken about revaluation because South River had not had one in some 25 years,” South River Mayor John Krenzel said.
Krenzel added that he even discussed the issue with the New Jersey Conference of Mayors because, as an attorney, he knew the ratio of true value to assessed value in the borough was “out of whack.” However, he put a potential revaluation “on the backburner” after Mother Nature struck.
“What changed was the fact that in October 2012, [superstorm] Sandy hit, and it affected our town,” he said.
In addition, Krenzel explained that as a result of Gov. Chris Christie’s Blue Acres Program to buy homes damaged by Sandy, the town lost 64 houses in the first buyout round and may lose another 60 in an upcoming second buyout. Since these buyouts reduce the number of taxable properties in the borough, Krenzel said conducting a revaluation now would not reflect an accurate picture of the town’s value.
“I have argued publicly, and I will argue to the state on the 26th, that this is not the right time,” he said.
The Division of Taxation launched investigations into three municipalities — Elizabeth, Jersey City and Dunellen — for being “delinquent” in conducting property revaluations in November of 2015. Following the investigation and required hearings, all three were ordered to conduct revaluations. In April of 2016, the Division announced it would be opening investigations into South River, Harrison, East Newark, Westfield and Winfield.
Dunellen’s revaluation order, dated April 4, 2016, noted a failure on the part of Middlesex County’s Board of Taxation to order regular revaluations, leading to an unfairly-distributed tax burden for residents and necessitating intervention by the state.
“Members of the Middlesex County [Board of Taxation] have demonstrated an astonishing lack of competence by ignoring their constitutional obligation,” Perone said.
A representative of the Middlesex County Board of Taxation did not respond to inquiries for comment.
If the Division of Taxation concludes its investigation and orders a revaluation, South River will be responsible for bearing the associated costs.
Perone declined to comment on specific details of the ongoing investigation into South River or if the state would launch similar investigations into other municipalities.
Contact Steven Viera at [email protected].