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For Some, Reassessment Largely Responsible for Estimated Tax Increases

As a whole, the town's rateable base decreased 18.4 percent as a result of the reassessment.

On top of the impending property tax increase -- next Tuesday -- some property owners' pocketbooks are set to take an additional, sometimes far greater hit, from the recent reassessment.

The reassessment, approved by council last fall and conducted by Appraisal Systems, Inc. over the winter, involved the inspection of all properties in the borough to ensure uniform and equitable property value assessments across the municipality.

As a result of the reassessment, the town's total rateable base dropped 18.4 percent, with plummeting residential property values accounting for much of the decline.

The average assessed home in Fair Lawn, previously listed at $411,663, is down 21.4 percent to $323,679.  

Fair Lawn's commercial, industrial and apartment property values, while also on the decline, have dipped only a combined 2.3 percent.

This disparity in the severity of property devaluation between residential and commercial property owners has effectively shifted the town's tax burden away from residents and onto the backs of business and apartment owners, as had been anticipated.

"That’s been the trend in the other reassessments that I've seen," borough tax assessor Tim Henderson said. "Commercial values never seem to fluctuate as much as residential values, historically."

To determine how the reassessment has affected your taxes, simply compare the change in your property value to the overall shift in the town's rateables. If your property's value has decreased more than 18.4 percent, your taxes went down as a result of the reassessment. If your property's value has not decreased by as much as 18.4 percent or has actually increased, the reassessment has directly contributed, sometimes quite significantly, to your estimated tax increase.

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Ozzydude July 11, 2012 at 02:39 PM
Can someone correct me if I am wrong with this logic? I am relatively new to NJ and I'm a bit hazy on these calculations: The 2011 Fair Lawn tax rate was 2.337 and the annual property taxes last year were calculated as (2011 assessed value * 2.337) / 100, i.e. if a house was assessed at $500K, the taxes were 500,000 * 2.337 / 100, which would be $11,685. In 2012, tax rate went up by 4% (am I right?) to (2.337*1.04) which is 2.4305; Home values were re-assessed, and that $500K assessment went down, say, 15%, to $425,000. So 2012 prop taxes would be 425,000 * 2.4305 / 100 which is $10,329. Am I right? thank you very much!
Zak Koeske July 11, 2012 at 03:47 PM
@Ozzydude - The estimated third quarter tax rate is 3.004. Use that as your multiplier.
Ozzydude July 11, 2012 at 04:25 PM
Thanks Zak. How can the prop tax rates increase from 2.337 (per column 7 of http://www.state.nj.us/treasury/taxation/pdf/lpt/ratables/bergencountyar11.pdf) to 3.004? that seems like a 28% increase from 2.337 - does that make sense...?
Zak Koeske July 11, 2012 at 04:39 PM
You can't just look at the tax rate independently. You have to look at it as it relates to the property assessment. To put it simplistically, when assessments go down across the board because of a reassessment, the tax rate must increase to make up for it because the town still needs to generate the same amount or more revenue than the previous year to operate. If you look at other towns that have done reassessments in the last couple years, their tax rates also jumped because their property values dropped. To find out by what percentage your taxes increased or decreased, you'd need to multiply the assessment by the rate for both this year and for last year, and then calculate the resulting difference.
Harold Vogel July 11, 2012 at 07:09 PM
It's better then the last reassessment, in 2007, when the housing prices started to crash. They kicked the "values" up more then selling prices. When I went down to question the reasoning behind the new valuation since they never came around at all. The answer I was given was that they looked at the old books and increased everybody by 10%. My mistake was that I never appealed it then when it would not cost anything. By the time I realized the market was staying down, It would have cost me more in lawyer and administration fees then any savings on the tax plus the lawyer's cut of what ever decrease. I think all they did this time was adjust to the market value nice way to make a quick $371,500.

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