Steven Fulop’s press person, Jennifer Morrill, made an egregious error on the record this month when she characterized tax appeals as not being based on sales prices. Tax appeals are, in fact, based explicitly on recent comparable sales prices.
Ms. Morrill’s statement was in response to a story about a local resident, April Kuzas, who recently filed a tax appeal to force Mayor Fulop’s property assessment value to be increased. Ms. Kuzas’ argument is based on a widely reported fact: Mayor Fulop is severely under-taxed. His under-taxation is due primarily to Jersey City’s severely outdated assessment values (the last citywide revaluation was 1988). In 2013, Mayor Fulop unilaterally cancelled a citywide Revaluation that had been initiated by the prior administration. Kuzas is asserting that not only is the mayor under-taxed, but he’s continuing to benefit from that under-taxation in part due to his own decision to cancel the Reval in 2013.
Kuzas’ action forced the city to respond to the issue of Fulop’s under-taxation. Morrill’s statement included the following:
“tax appeal law doesn’t allow for this sort of appeal based on sale prices. Appeals are based on assessments…”
But Morrill’s statement is grossly incorrect. Tax appeals are based explicitly on recent, comparable sales prices. Appeals are not based on neighbors’ assessments. The Hudson County Board of Taxation emphasizes this reliance on sales prices in its Tax Appeal Filing Packet:
Recent sales are important because, per NJ property law, assessments are supposed to be based on true, or market, value. Recent comparable sales are, therefore, viewed as the most reasonable proxy for estimating market value. Fulop’s case is particularly straightforward since he purchased fairly recently; the sale price serves as a reasonable proxy for his market value.
Fulop’s under-taxation ferreted out a second error in Ms. Morrill’s statement. Morrill also stated:
“…the mayor is exactly in line with others. There is no favorable treatment.”
- Fulop bought a home in the Heights in July 2015 for $845,000.
- The property has an assessed value of $104,000
- If we divide his assessment value by his sale price, we see that Fulop has an “assessment-sales ratio” of about 12% ($104K / $845K = 12%).
Jersey City’s 2016 equalization ratio – which is the citywide average of the “assessment-sales ratios” for all homes in the city – is 23.66%. Properties with assessment-sales ratios below this average are generally considered under-taxed; since Fulop’s home is far below this average – at 12% – he’s clearly under-taxed. Therefore, Fulop’s property is not “exactly in line” with the citywide average as Morrill stated. We can reasonably conclude that the mayor’s under-taxation, in conjunction with his authority to unilaterally cancel the previous Revaluation in 2013 with no objection from the City Council, as “favorable treatment.”
Our city is undergoing its first mass revaluation in nearly 30 years – we need a mayor’s office that both understands local property tax laws and communicates clearly and honestly to the public about those laws.