Over Valued: Lower Township May Reassess All Properties

VILLAS — Lower Township will reassess all property values to reflect lower values from the real estate market decline, pending state and county approval.
While the move will give homeowners a realistic assessment, it would also raise the township’s local purpose tax rate, currently 36.6 cents per $100 of assessed value, to make up for lost ratables. The present total tax rate is $1.112 per $100 of assessed value.
Lower Township Tax Assessor Arthur Amonette presented a proposal to Township Council Monday to reassess all properties for a fee of $30,000 to $35,000, working Saturdays at a cost of $100 per hour. Due to the declining real estate market, 400 to 500 property owners have called or come to the tax office asking if assessments would be reduced, he said.
Assessments would be reduced to current market value, said Amonette. The township paid for a revaluation in 2007, which reflected home prices as of Oct. 1, 2006, the peak of the real estate boom, he said.
He said rather than just reducing assessments in certain neighborhoods, it would be better to reassess every property in the township. Amonette said he did not have enough time during his regular working hours to undertake an assessment of the township, so he would work evenings and weekends.
Applications have been filed with the county Board of Taxation and state Division of Taxation. Amonette said the state may require a notice be mailed to each property owner informing them of their new assessment, which would cost $10,000 in printing and postage costs.
He said he would prefer to post the results on a Web page and save $10,000.
Amonette said if the township did not take some action in the next year, it could receive an order from the county to conduct another revaluation. He said he did not know of any other towns considering a reassessment in Cape May or Atlantic counties.
“They should be but they are not,” he said.
Amonette said he received 500 property tax appeals after the 2007 reval. He said as a result, the township lost about $10 million in ratables.
In 2008, the township had about 100 appeals which amounted to $3 million to $4 million in ratable loss, said Amonette.
In 2009, the tax assessor had 210 appeals creating another $10 million loss in ratables. He said everyone who filed an appeal, received a reduction.
“Looking towards next year, we could end up with 500 to 1,000 appeals,” said Amonette.
For every $10 million in ratables lost, the township loses $115,000 in tax dollars that is not collected, but is still owed to the schools and county.
Councilman Thomas Conrad supported a reassessment.
Township Manager Kathy McPherson said the township paid $900,000 for the 2007 revaluation. Conrad said it was better to spend $30,000 now than $900,000 again in two years.
Amonette said if the township’s assessment were reduced 20 percent, the tax rate next year would go up 20 percent to make up for the reduction. He said taxes for most property owners would stay about the same, perhaps a change of $100.
Those who have already had their assessment reduced could see their taxes rise, said Amonette. He said property assessments were averaging 110 percent of true value.
Assessments in Villas are averaging 130 percent of market value, said Amonette. He said most lots in Villas are assessed from $120,000 to $180,000, but lots are currently selling for $65,000 to $100,000.
Mayor Michael Beck asked if the township dropped assessed values and real estate market rebounds in the near future, could the township be ordered to conduct another reval when assessments are undervalued by 15 percent.
Amonette said if the township does not reassess property values, it could be ordered to undertake a revaluation. He said he did not expect a resurgence in real estate values in the near future.
Conrad said when a property owner has their assessment lowered by appeal, other taxpayers pick up that tax burden.
Beck said council worked hard to bring the township budget “in line.” Amonette said even if council reduced the township budget next year, the tax rate would still go up as a result of the reassessment.
During public comment, Ed Butler, vice president of the Lower Township Taxpayers Association, said his taxes doubled after the last revaluation. He said the reassessment could level out the playing field.