For most homeowners, the collapse of the housing market hasn’t translated to relief from property taxes. Those taxes were slow to catch up with the boom, and now they’re just as slow to fall as home values sink.

Property taxes — the principal source of revenue for cities, counties and school districts — are calculated by multiplying the nominal property-tax rate by the assessment ratio (the percentage of the value of the property that is taxed) by the value of the property. Such taxes are often the second-largest expense of homeownership, trailing only mortgages.

The figures in the map and table below, put together by the nonprofit Tax Foundation, are for property taxes paid by households on owner-occupied housing. As a result, they exclude property taxes paid by businesses, renters and others.

All data in the map and table come from the 2008 American Community Survey from the U.S. Census Bureau. Median tax is the median real estate tax paid on owner-occupied housing units for that state. The home-value statistic used is the median value of owner-occupied housing units for that state. The income statistic used is the median household income for those households that are owner-occupied housing units.

Article sourced from MSN Money. Click here for the original.

He described the matter as a complex case “where hundreds of thousands of dollars” in revenue could be at stake.

On Nov. 20 of last year, the court entered a judgment against the borough and for SP One Meadowlands Plaza. It pertains to Block 108.03, Lot 1.01 on the municipal tax map.

The site is located off Route 3 East, directly across the highway from Giants Stadium. The tract features an active 15-story office building with 422,470 square feet, situated on 10.49 acres of land. It also features surface and covered parking, the latter through a five-story garage with 1,300 stalls.

Cassella said the facility was once known informally as “the Metromedia building.” That was when it served as the corporate home to the multi-billion telecommunications and media giant, former owners of New York’s Channel 5. The conglomerate has since moved to Hackensack.

Experts for both parties initially appeared in the court’s Newark chambers May 8 of last year to offer testimony.

Cassella said the council must now decide whether it wants to appeal the opinion, reached by state Tax Court Judge Patrick DeAlemida, to the Appellate Division of New Jersey Superior Court or attempt a settlement.

The ruling reversed a 2005 decision by the Bergen County Board of Taxation upholding the borough’s initial appraisal, effective Oct. 1, 2004 (for the 2005 tax year). Thus, the borough served as defendant in the case.

Stephen Sinisi, the borough’s special tax counsel, appeared during a closed session at the Dec. 29 year-end meeting to discuss options.

Neither Sinnisi, nor the plaintiff’s counsel, Michael Donnelly, with the Newark law firm McCarter and English, LLP, returned calls at press time.

For the same case, the court upheld East Rutherford’s $60 million appraisal for tax year 2004 (effective Oct. 1, 2003).

Cassella estimated anywhere between $100,000 to $200,000 might have to be refunded for this one year, due to the decision.

Yet he cautioned the matter is “very complex,” and that even more revenue could be in jeopardy, depending on the case’s future course.

“We’re awaiting further advice from our tax lawyer,” said the mayor, declining to offer an estimate on when any appeal to Superior Court might be filed, if the council indeed approves taking the case that far. “This decision affects only one party which has owned the site.”

“What could complicate the picture is more litigation involving other separate entities which owned the property during other times,” the mayor explained. “If they step forward, more tax years could come under challenge.”

Cassella claimed that in recent years at least “three separate companies have owned the site on different occasions.”

In his 17-page ruling, DeAlemida reduced the site’s tax year 2005 appraisal by $8,624,480, to $51,375,520.

He assessed the land at $7,867,500 and improvements at $43,508,020. East Rutherford similarly appraised the land, but calculated a $52,132,500 valuation for improvements.

DeAlemida’s ruling considered complex factors, including mandated appraisal formulas, the perceived value of adjacent office sites, comparable leases and the building’s income-earning potential via rent the plaintiffs collected.

Both sides offered different views on certain criteria, relating only to tax year 2005, which the Bergen County Tax Board also evaluated almost five years ago.

“The court finds that plaintiff provided sufficient evidence to overcome the presumption of validity attached to the county tax board’s judgment,” DeAlemida wrote.

He cited sufficient cause to reject the borough’s claims that its appraisal was based on valid evidence, including comparable leases and comparable sales of similar properties.

In examining comparable leases from the parties, the judge claimed “SP One Meadowlands Plaza” offered “the more persuasive evidence in the record of market rent.”

He ruled, “Three of the defendant’s comparable leases were older, beginning in 2000 and 2001, while the comparable leases of plaintiff’s expert were more recent and from buildings more similar to the subject property.”

Further, the judge contended East Rutherford failed the test in seeking to use “comparable sales” for tax year 2005 to “confirm and temper” its expert’s opinions regarding income generated via rents. He referred to the latter test as “the income approach to valuation.”

DeAlemida opined, “The court gives little weight to the comparable sales approach in this case,” based on the evidence.

In conclusion, DeAlemida stated that he ruled for the plaintiff in applying Chapter 123 of state statutes covering property tax law.

He noted that part of this chapter states, “In a non-revaluation year, an assessment must be reduced if the ratio of the (property’s) assessed value to its true value exceeds the upper limit of the common level range.”

For tax year 2005, he wrote, the ratio (set by factoring the assessed value of $60 million into the true value of $78,400,000) came out to a ratio of .7653. This was higher than “the upper limit of the range (established at .7536).”

— Contact Chris at 201-438-8700

Article sourced from The Leader. Click here for the original article.

The Tax Appeal process can be intense. While it is not overly complicated, it is difficult to complete in a time and cost efficient manner for those who may be unfamiliar with real estate valuation and tax appeals in general. Too, there are legal and procedural hurdles which MUST be complied with. Accessing and preparing appropriate data for the appeal can also be costly and time consuming. If you find after viewing the free content here, that the appeal process is overwhelming, consider hiring Envoy Real Estate to help you. We offer a range of services from data sourcing to full appraisal preparation and expert witness representation.

Envoy Real Estate, LLC is a full service real estate valuation and consultation company based in Central New Jersey. We have nearly 20 years of appraisal and consultation experience and are New Jersey Tax Appeal specialists.

Please indicate which of the following services you are in need of and let us help.

1. General Consultation: We analyze your assessments and report back whether there is a reasonable basis for appeal. A detailed summary page of our findings will be emailed to you within 3 business days. $ 200.00
2. Record card Review and Site Inspection – Specifically designed to locate error based tax appeals. We will request and review your property record card from the taxing district and compare it to actual conditions. Any factual errors will be highlighted and their potential impact on tax burden will be discussed. A complimentary analysis of your current assessments and potential for appeal is included within this service bundle. Requires site visit by appraiser. $350.00
3. Sales Data Sourcing & Verification: Envoy Real Estate, LLC will research, summarize and verify 4 sales that can be used from the informal assessor meeting, all the way through presentation at the tax court level. Sales are fully vetted for appeal purposes and contain all required information as per tax appeal rules of evidence and procedure. 7 to 10 day Delivery.
   1. 1. Residential Tax Appeal Sales $500.00
      2. Commercial/Industrial/Investment Tax Appeals $750.00
4. Residential Tax Appeal Coaching Services: We will assist you through the appeal process from initial filing and analysis through presenting your case at the Tax Board. Sales Data Sourcing and Verification, initial consultation, and record card review and site inspection are included within this bundle of services. $1,200

5. Commercial/Industrial/Investment Property

1. 1. Tax Appeal Coaching / Following services are bundled $1,500
      1. General Consultation – Filing dates review
      2. Record card Review and Site Visit
      3. Sales Data Sourcing & Verification
      4. Lease Data Sourcing
      5. Market Surveys and Cap Rates Sourcing

b. Tax Appeal Report Options

1. 1. 1. Informal Assessor Meeting Report $1,000
         1. Appearance Fee if Needed $250
      2. Formal Appraisal / Tax Board –Tax Court $3,000
         1. Expert Witness / Hourly $150 / Hr.

Note – if you are unsure what level of service you need or want, contact us with your question. Our goal is to provide a service to our customers for a reasonable price.

Discounted rates are available for multi property assignments and corporate user accounts*.

$1,200