[Amended 1-28-2014 by Ord. No. 3-2014]
As used in this article, the following terms shall have the
meanings indicated:
That portion of the assessed value of a property as it existed
prior to construction, improvement or conversion of a building or
structure thereon, which is exempted from taxation pursuant to this
article.
A duration of time comprised of 365 days, or 366 days when
the included month of February has 29 days, that commences on the
date that an exemption or abatement for a project becomes effective
pursuant to N.J.S.A. 40A:21-16.
A portion or all of a municipality which has been determined
to be an area in need of rehabilitation or redevelopment pursuant
to the Local Redevelopment and Housing Law, P.L. 1992, c. 79 (N.J.S.A.
40A:12A-1 et seq.), a "blighted area" as determined pursuant to the
Blighted Areas Act, P.L. 1949, c. 187 (N.J.S.A. 40:55-21.1 et seq.),[1] or which has been determined to be in need of rehabilitation
pursuant to P.L. 1975, c. 104 (N.J.S.A. 54:4-3.72 et seq.), P.L. 1977,
c. 12 (N.J.S.A. 54:4-3.95 et seq.), or P.L. 1979, c. 233 (N.J.S.A.
54:4-3.121 et seq.).[2]
The officer of a taxing district charged with the duty of
assessing real property for the purpose of general taxation.
A structure or part thereof used for the manufacturing, processing
or assembling of material or manufactured products, or for research,
office, industrial, commercial, retail, recreational, hotel or motel
facilities, or warehousing purposes, or for any combination thereof,
which the governing body determines will tend to maintain or provide
gainful employment within the municipality, assist in the economic
development of the municipality, maintain or increase the tax base
of the municipality and maintain or diversify and expand commerce
within the municipality. It shall not include any structure or part
thereof used or to be used by any business relocated from another
qualifying municipality unless the total square footage of the floor
area of the structure or part thereof used or to be used by the business
at the new site together with the total square footage of the land
used or to be used by the business at the new site exceeds the total
square footage of that utilized by the business at its current site
of operations by at least 10% and the property that the business is
relocating to has been the subject of a remedial action plan costing
in excess of $250,000 performed pursuant to an administrative consent
order entered into pursuant to authority vested in the Commissioner
of Environmental Protection under P.L. 1970, c. 33 (N.J.S.A. 13:1D-1
et seq.); the Water Pollution Control Act, P.L. 1977, c. 74 (N.J.S.A.
58:10A-1 et seq.); the Solid Waste Management Act, P.L. 1970, c. 39
(N.J.S.A. 13:1E-1 et seq.); and the Spill Compensation and Control
Act, P.L. 1976, c. 41 (N.J.S.A. 58:10-23.11 et seq.).
Substantially ready for the intended use for which a building
or structure is constructed, improved or converted.
A property created or recorded as a condominium pursuant
to the Condominium Act, P.L. 1969, c. 257 (N.J.S.A. 46:8B-1 et seq.).
The provision of a new dwelling, multiple dwelling or commercial
or industrial structure, or the enlargement of the volume of an existing
multiple dwelling or commercial or industrial structure by more than
30%, but shall not mean the conversion of an existing building or
structure to another use.
The alteration or renovation of a nonresidential building
or structure, or hotel, motel, motor hotel or guesthouse, in such
manner as to convert the building or structure from its previous use
to use as a dwelling or multiple dwelling.
A housing corporation or association, wherein the holder
of a share or membership interest thereof is entitled to possess and
occupy for dwelling purposes a house, apartment, or other unit of
housing owned by the corporation or association or to purchase a unit
of housing owned by the corporation or association.
When used with respect to abatements for dwellings or multiple
dwellings, only the cost or fair market value of direct labor and
materials used in improving a multiple dwelling, or of converting
another building or structure to a multiple dwelling, or of constructing
a dwelling, or of converting another building or structure to a dwelling,
including any architectural, engineering, and contractor's fees associated
therewith, as the owner of the property shall cause to be certified
to the governing body by an independent and qualified architect, following
the completion of the project.
A building or part of a building used, to be used or held
for use as a home or residence, including accessory buildings located
on the same premises, together with the land upon which such building
or buildings are erected and which may be necessary for the fair enjoyment
thereof, but shall not mean any building or part of a building, defined
as a "multiple dwelling" pursuant to the Hotel and Multiple Dwelling
Law, P.L. 1967, c. 76 (N.J.S.A. 55:13A-1 et seq.). A dwelling shall
include, as they are separately conveyed to individual owners, individual
residences within a cooperative, if purchased separately by the occupants
thereof, and individual residences within a horizontal property regime
or a condominium, but shall not include "general common elements"
or "common elements" of such horizontal property regime or condominium
as defined pursuant to the Horizontal Property Act, P.L. 1963, c.
168 (N.J.S.A. 46:8A-1 et seq.), or the Condominium Act, P.L. 1969,
c. 257 (C:46:8B-1 et seq.), or of a cooperative, if the residential
units are owned separately.
That portion of the Assessor's full and true value of any
improvement, conversion alteration, or construction not regarded as
increasing the taxable value of a property pursuant to this article.
A property submitted to a horizontal property regime pursuant
to the Horizontal Property Act, P.L. 1963, c. 168 (N.J.S.A. 46:8A-1
et seq.).
A modernization, rehabilitation, renovation, alteration or
repair which produces a physical change in an existing building or
structure that improves the safety, sanitation, decency or attractiveness
of the building or structure as a place for human habitation or work
and which does not change its permitted use. In the case of a multiple
dwelling, it includes only improvements which affect common areas
or elements or three or more dwelling units within the multiple dwelling.
In the case of a multiple dwelling or commercial or industrial structure,
it shall not include ordinary painting, repairs and replacement of
maintenance items or an enlargement of the volume of an existing structure
by more than 30%. In no case shall it include the repair of fire or
other damage to a property for which payment of a claim was received
by any person from an insurance company at any time during the three-year
period immediately preceding the filing of an application pursuant
to this article.
Ownership of a dwelling or other property that is not defined
as an owner-occupied dwelling.
A building or structure meeting the definition of "multiple
dwelling" set forth in the Hotel and Multiple Dwelling Law, P.L. 1967,
c. 76 (N.J.S.A. 55:13A-1 et seq.) and means for the purpose of improvement
or construction the "general common elements" and "common elements"
of a condominium, a cooperative, or a horizontal property regime.
A dwelling owned by a person or persons having at least a
fifty-percent interest in a one- to three-unit dwelling property that
constitutes his, her or their principal residence.
The following procedures shall govern agreements for tax exemption
with property owners as may be authorized by the City Council:
A.
Application. No exemption shall be granted except upon written application
therefor filed with and approved by the Tax Assessor of the City of
Hackensack.
B.
Form. Every application shall be on a form prescribed by the Director of the Division of Taxation in the New Jersey Department of the Treasury and shall be filed with the Tax Assessor within 30 calendar days following the completion of the improvement, conversion, alteration or construction. Applications for exemption from taxation for construction of industrial and commercial structures or multiple dwellings, or both, shall also comply with the requirements of § 153-12 hereof.
C.
Recordation. The granting of an exemption or approval of a tax agreement
shall be recorded in the Tax Collector's office and made a permanent
part of the official tax records of the City of Hackensack, which
record shall contain a notice of the termination date thereof.
D.
Rehabilitation areas only. Applications may be received and granted
only with respect to property which is located in an area which has
been designated and remains within an area in need of rehabilitation
in accordance with applicable law and, for this article, which are
the subject of the application and which conform to the provisions
of the City's Zoning Ordinance[1] as to the district wherein the structure is located.
E.
Prior tax abatements. This article shall not affect any exemption,
abatement, or tax agreement previously granted and in force prior
to the adoption of this article.
F.
Effective date. Exemptions granted pursuant to this article shall
be effective for the first full tax year commencing after the tax
year in which this article is adopted and for tax years thereafter
as set forth in P.L. 1991, c. 441 (N.J.S.A. 40A:21-1 et seq.). No
application for exemption shall be filed for an exemption to take
effect for the tax year 2025 or any tax year occurring thereafter,
unless the ordinance codified in this chapter is readopted by the
City Council in accordance with applicable law.
G.
Taxes affected. The exemption of real property taxes provided pursuant
to this chapter shall apply to property taxes levied for municipal
purposes, school purposes, county government purposes and for the
purposes of funding any other property tax exemptions or abatements.
H.
Additional improvement. Any additional improvement, conversion or
construction, completed on a property granted a previous exemption
pursuant to this article during the period in which such previous
exemption is in effect, shall be qualified for an exemption, just
as if such property had not received a previous exemption. In such
case, the additional improvement, conversion or construction shall
be considered as separate for the purposes of calculating exemptions
pursuant to this article, except that the assessed value of any previous
improvement, conversion or construction shall be added to the assessed
valuation as it was prior to that improvement, conversion alteration
or construction for the purpose of determining the assessed valuation
of the property on which any additional exemption is to be calculated.
Unless provided by ordinance, no additional exemption shall be allowed.
I.
Ineligibility. No exemption shall be granted, or tax agreement entered
into, pursuant to this chapter, with respect to any property for which
property taxes are delinquent or remain unpaid or for which penalties
for nonpayment of taxes are due.
J.
Tax on land: credit. Any exemption approved pursuant to this article
shall affect only the tax on improvements. The tax on land shall not
be affected by any such approval; provided, however, that there shall
be credited against the annual service charge the full amount of taxes
paid on the land within the project during the preceding calendar
year. Notwithstanding such credit, in no year for which the tax agreement
is in effect shall the total of the amount payable as taxes on land
and as annual service charge be less than the total of taxes paid
on the land within the project for the calendar year preceding the
tax agreement.
Applicants approved by the Tax Assessor for projects pursuant to § 153-12 herein shall enter a tax agreement with the City. The tax agreement shall be approved by ordinance authorizing execution of a tax agreement for the abatement of the particular project from local real property taxes. All tax exemption agreements hereunder shall be in effect for a period of not more than five years starting with the date of completion of the project as evidenced by the issuance of a temporary or permanent certificate of occupancy.
A.
Rehabilitation. There may be granted, pursuant to this chapter, the
exemption from taxation of improvements to various types of existing
dwellings which undergo rehabilitation.
(1)
Rehabilitation of owner-occupied one- to three-unit residential dwellings.
In determining the value of real property in which there are one to
three residential units and at least one of said units is owner-occupied
and for which exemption is granted, the City shall regard the first
$50,000, in Assessor's full and true value of improvements for each
dwelling unit primarily and directly affected by the improvement in
any dwelling more than 20 years old, as not increasing the value of
the property for a period of five years, notwithstanding that the
value of the property to which the improvements are made is increased
thereby. During the exemption period, the assessment on the property
shall not be less than the assessment thereon existing immediately
prior to the improvements, unless there is damage to the dwelling
through action of the elements sufficient to warrant a reduction.
(2)
Rehabilitation of investor-owned one- to three-unit residential dwellings.
In determining the value of real property in which there are one to
three residential units and the property is investor-owned and for
which exemption is granted, the City shall regard the first $50,000,
in Assessor's full and true value of improvements for each dwelling
unit primarily and directly affected by the improvement in any dwelling
more than 20 years old, as not increasing the value of the property
for a period of five years, notwithstanding that the value of the
property to which the improvements are made is increased thereby.
During the exemption period, the assessment on the property shall
not be less than the assessment thereon existing immediately prior
to the improvements, unless there is damage to the dwelling through
action of the elements sufficient to warrant a reduction.
(a)
In order to be eligible for this exemption, the investor-owner
must invest an amount equal to or greater than 50% of the assessed
value of the dwelling unit primarily and directly affected.
(b)
Rehabilitation of investor-owned dwellings that increase the
legal occupancy of the dwelling shall not be eligible for an exemption.
B.
New construction. There may be granted, pursuant to this chapter,
an exemption from taxation of improvements to various types of newly
constructed dwellings, including conversion of buildings previously
used for nonresidential use and unutilized public buildings converted
to residential use.
(1)
New construction, owner-occupied. Thirty percent of the Assessor's
full and true value of the dwelling constructed or converted may be
regarded as not increasing the value of the property for up to five
years.
(2)
New construction, investor-owned. Zero percent of the Assessor's
full and true value of the dwelling constructed or converted may be
regarded as not increasing the value of the property for up to five
years.
There may be granted, pursuant to this chapter, the exemption
from taxation of improvements to multiple dwellings or of conversions
of other buildings and structures, including unutilized public buildings,
to multiple dwelling use, or both. In determining the value of such
real property, the Assessor's full and true value of the improvements
or conversion alterations shall be regarded as not increasing the
value of the property for a period of five years, notwithstanding
that the value of the property to which the improvements or conversion
alterations are made is increased thereby. During the exemption period,
the assessment on the property shall not be less than the assessment
thereon existing immediately prior to the improvements or conversion
alterations, unless there is damage to the multiple dwelling through
action of the elements sufficient to warrant a reduction.
A.
The rehabilitation of a multiple dwelling shall not be eligible for
the exemption from taxation of improvements unless the owner documents
the minimum investment of $40,000 in the rehabilitation of each dwelling
unit.
B.
Rehabilitation and improvement costs may include rehabilitation or
improvements made directly to the unit and a share of rehabilitation
and improvement costs made to common areas. The share of rehabilitation
and improvement costs for common areas shall be calculated as follows:
(1)
Cost of common area improvements divided by the total square footage
of the units in the building(s) equals common area costs per square
foot (CAC/SF).
(2)
CAC/SF multiplied by the square footage of the unit equals unit share
of CAC.
(3)
Unit share of CAC plus direct rehabilitation and improvement costs
equals total rehabilitation and improvement cost.
A.
There may be granted pursuant to this article exemption from taxation
of improvements to commercial or industrial structures. In determining
the value of real property for which such exemption is granted, the
Assessor's full and true value of the improvements shall be regarded
as not increasing the value of the property for a period of five years,
notwithstanding that the value of the property to which the improvements
are made is increased thereby. During the exemption period, the assessment
on the property shall not be less than the assessment thereon existing
immediately prior to the improvements, unless there is damage to the
structure through action of the elements sufficient to warrant a reduction.
B.
The rehabilitation of a commercial or industrial structure shall
not be eligible for the exemption from taxation of improvements unless
the owner documents the minimum investment of $10 per square foot
of floor area of the structure in the rehabilitation of the structure.
The following procedures are applicable to all applications
for exemption affecting construction of industrial and commercial
structures or multiple dwellings, or both.
A.
Applicants for tax exemption for new construction of commercial or
industrial structures or multiple dwellings pursuant to this chapter
shall provide the Tax Assessor with an application setting forth:
(1)
A general description of a project for which exemption is sought;
(2)
A legal description of all real estate necessary for the project;
(3)
Plans, drawings and other documents as may be required by the Tax
Assessor to demonstrate the structure and design of the project;
(4)
If the project is a commercial or industrial structure or a mixed-use
project containing commercial or industrial elements, a description
of the estimated number, classes and type of employees to be employed
at the project site within two years of completion of the project;
(5)
A statement of the reasons for seeking tax exemption on the project,
and a description of the benefits to be realized by the applicant
if a tax agreement is granted;
(6)
Estimates of the cost of completing such project; and
(7)
A statement showing:
(a)
The real property taxes currently being assessed at the project
site;
(b)
Estimated tax payments that would be made annually by the applicant
on the project during the period of the agreement; and
(c)
Estimated tax payments that would be made by the applicant on
the project during the first full year following the termination of
the tax agreement;
(8)
If the project is a commercial or industrial structure, a description
of any lease agreements between the applicant and proposed users of
the project, and a history and description of the users' businesses;
(9)
If the project is a multiple dwelling, a description of the number
and types of dwelling units to be provided, a description of the common
elements or general common elements, and a statement of the proposed
initial rentals or sales prices of the dwelling units according to
type and of any rental lease or resale restrictions to apply to the
dwellings' units respecting low- or moderate-income housing; and
(10)
Such other pertinent information as the governing body may require.
B.
Upon adoption of an ordinance authorizing a tax agreement or agreements
for a particular project or projects, the City Council shall enter
into written tax agreement with the applicant for the exemption of
local real property taxes. Such agreement shall provide for the applicant
to pay to the City in lieu of full property tax payments an amount
annually to be computed by one, but in no case a combination, of the
following formulas:
(1)
Cost basis. The tax agreement may provide for the applicant to pay
to the City in lieu of full property tax payments an amount equal
to 2% of the cost of the project. For the purposes of the agreement,
"the cost of the project" means only the cost or fair market value
of direct labor and all materials used in the construction, expansion,
or rehabilitation of all buildings, structures, and facilities at
the project site, including the costs, if any, of land acquisition
and land preparation, provision of access roads, utilities, drainage
facilities, and parking facilities, together with architectural, engineering,
legal, surveying, testing, and contractors' fees associated with the
project, which the applicant shall cause to be certified and verified
to the City Council by an independent and qualified architect, following
the completion of the project.
(2)
Gross revenue basis. The agreement may provide for the applicant
to pay to the City in lieu of full property tax payments an amount
annually equal to 15% of the annual gross revenues from the project.
For the purposes of the agreement, "annual gross revenues" means the
total annual gross rental and other income payable to the owner of
the project from the project. If in any leasing, any real estate taxes
or assessments on property included in the project, any premiums for
fire or other insurance on or concerning property included in the
project, or any operating or maintenance expenses ordinarily paid
by the landlord are to be paid by the tenant, then those payments
shall be computed and deemed to be part of the rent and shall be included
in the annual gross revenue. The tax agreement shall establish the
method of computing the revenues and may establish a method of arbitration
by which either the landlord or tenant may dispute the amount of payments
so included in the annual gross revenue.
(3)
Tax phase-in basis. The agreement may provide for the applicant to
pay to the City in lieu of full property tax payments an amount equal
to a percentage of taxes otherwise due, according to the following
schedule:
(a)
In the first full tax year after completion, no payment in lieu
of taxes otherwise due.
(b)
In the second tax year, an amount not less than 20% of taxes
otherwise due.
(c)
In the third tax year, an amount not less than 40% of taxes
otherwise due.
(d)
In the fourth tax year, an amount not less than 60% of taxes
otherwise due.
(e)
In the fifth tax year, an amount not less than 80% of taxes
otherwise due.
C.
The following shall apply to all tax agreements entered into pursuant
to this chapter:
(1)
Any tax agreement entered into by the City pursuant to this section
shall be in effect for no more than the five full tax years next following
the date of completion of the project.
(2)
Any project subject to tax agreement as provided herein shall be
subject to all applicable federal, state and local laws and regulations
on pollution control, worker safety, discrimination in employment,
housing provision, zoning, planning and building code requirements.
(3)
That percentage which the payment in lieu of taxes for a property
bears to the property tax which would have been paid had an exemption
and abatement not been granted for the property under the tax agreement
shall be applied to the valuation of the property to determine the
reduced valuation of the property to be included in the valuation
of the City for determining equalization for county tax apportionment
and school aid during the term of the tax agreement covering the property,
and at the termination of an agreement for a property, the reduced
valuation procedure required under this section shall no longer apply.
(4)
Within 30 days after the execution of a tax agreement, the City Clerk
shall forward a copy of the agreement to the Director of the Division
of Local Government Services in the New Jersey Department of Community
Affairs.
D.
As to any tax payment due upon termination of an agreement or upon
disqualification of a property owner prior to termination of an agreement,
the following shall be applicable:
(1)
If during any tax year prior to the termination of the tax agreement
the property owner ceases to operate or disposes of the property,
or fails to meet the conditions for qualifying, then the tax which
would have otherwise been payable for each tax year shall become due
and payable from the property owner as if no exemption had been granted.
The City Council shall notify the property owner and Tax Collector
forthwith, and the Tax Collector shall, within 15 days thereof, notify
the owner of the property of the amount of taxes due.
(2)
However, with respect to the disposal of the property, where it is
determined that the new owner of the property will continue to use
the property pursuant to the conditions which qualified the property,
no tax shall be due, the exemption shall continue, and the tax agreement
shall remain in effect. The property owner shall furnish such information
as the City may require in order to determine whether such exemption
shall continue.
(3)
At the termination of a tax agreement, a project shall be subject
to all applicable real property taxes as provided by state law and
regulation and local ordinance, but nothing herein shall prohibit
a project, at the termination of an agreement, from qualifying for
and receiving the full benefits of any other tax preferences provided
by law.
Every application for exemption which is filed within the time
specified shall be approved and allowed by the Tax Assessor to the
degree that the application is consistent with the provisions of this
chapter or the tax agreement, provided that the improvement, conversion
alteration or construction for which the application is made qualifies
as an improvement, a conversion alteration or construction pursuant
to the provisions of this chapter and the tax agreement, if any. The
granting of the exemption or tax agreement shall be recorded and made
a permanent part of the official tax records of the City, which record
shall contain a notice of the termination date thereof.
Determination of tax due upon completion of improvement, conversion
or construction; Assessor's responsibilities; administrative provisions.
A.
The Assessor shall determine, on October 1 of the year following the date of the completion of an improvement, conversion or construction, the true taxable value thereof. Except for projects subject to tax agreement incorporating one of the formulas contained in § 153-12 of this article, the amount of tax to be paid for the first full tax year following completion shall be based on the assessed valuation of the property for the previous year, plus any portion of the assessed valuation of the improvement, conversion or construction not allowed an exemption pursuant to this article. Subject to the provisions of the adopting ordinance, the property shall continue to be treated in the appropriate manner for each of the five full tax years subsequent to the original determination by the Assessor.
B.
The Tax Assessor and/or the Tax Collector shall, during the first
year following adoption of the ordinance codified in this chapter,
include an appropriate notice in the mailing of annual property tax
bills to each owner of a dwelling located in an area in which exemptions
may be allowed pursuant to this chapter.
C.
Report.
(1)
The City Council shall report, on or before October 1 of each year,
to the Director of the Division of Local Government Services in the
New Jersey Department of Community Affairs and to the Director of
the Division of Taxation in the New Jersey Department of the Treasury,
the total amount of real property taxes exempted and the total amount
abated within the City in the current tax year for each of the following:
(a)
Improvements of dwelling;
(b)
Construction of dwellings;
(c)
Improvements and conversions of multiple dwellings;
(d)
Improvements of commercial or industrial structures;
(e)
Construction of multiple dwellings under tax agreements; and
(f)
Construction of commercial or industrial structures under tax
agreements.
(2)
In the case of this § 153-14C(1)(e) and (f) above, the report shall state instead the total amount of payments made in lieu of taxes according to each formula utilized by the City, and the difference between the total amount and the total amount of real property taxes which would have been paid on the project had tax agreements not been in effect, for the current tax year. The annual report required by this section shall be prepared by the Tax Assessor.
The City shall include a notice in the mailing of annual property
tax bills to each owner of a dwelling located in an area in which
exemptions, or exemptions and abatements, may be allowed pursuant
to the ordinance during the first year following the adoption of the
ordinance.
Pursuant to N.J.S.A. 40A:21-4, this article shall be effective
for a period of 10 years from the date of adoption, and no application
for an exemption shall be filed for an exemption to take initial effect
for any year thereafter, until and unless this article is readopted
by the City in accordance with applicable law.
A.
On or before October 1 of each year, the City shall report to the
Director of the Division of Local Government Services in the Department
of Community Affairs and to the Director of the Division of Taxation
in the Department of the Treasury the total amount of real property
taxes exempted and the total amount abated within the City in the
current tax year for each of the following:
(1)
Improvements of dwellings;
(2)
Construction of dwellings;
(3)
Improvements and conversions of multiple dwellings;
(4)
Improvements of commercial or industrial structures;
(5)
Construction of multiple dwellings under tax agreements; and
(6)
Construction of commercial or industrial structures under tax agreements.
B.
In the case of Subsection A(5) and (6), the report shall state instead the total amount of payments made in lieu of taxes according to each formula utilized by the City, and the difference between that total amount and the total amount of real property taxes which would have been paid on the project had the tax agreement not been in effect, for the current tax year.
