[HISTORY: Adopted by the Mayor and Council of the Borough of Somerdale as indicated in article histories. Amendments noted where applicable.]
Article I Abatement for Home Improvements
Article II Exemption for Improvements to Commercial or Industrial Structures
§ 233-11 Duration of agreements; applicability of other provisions; valuation; copy of agreement to be provided.
[Adopted 5-10-1978 by Ord. No. 78:11]
For the purpose of this article, the following definitions shall apply:
- Substantially ready for the use for which it was intended.
- Any 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.
- HOME IMPROVEMENT
- The improvement of a dwelling which does not change its permitted use, and shall include the modernization, rehabilitation, renovation, alteration or repair of a dwelling.
In determining the value of real property for the purpose of taxation, the first $10,000 in the Assessor's full and true value of home improvements for each dwelling unit primarily and directly affected by a home improvement in any single- or multiple dwelling property more than 20 years old shall be regarded as not increasing the value of such property for a period of five years, notwithstanding that the value of the dwelling to which such improvements are made is increased thereby.
In no event, however, shall the assessment during that period be less than the assessment thereon existing immediately prior to such home improvements, unless there shall be damage through action of the elements sufficient to warrant a reduction.
The above amounts up to $10,000 shall be deducted from the amount determined by the Assessor on October 1 of any year following the completion of the improvements to be the true taxable value of the improvements and shall continue to be so treated for each of the five tax years subsequent to the original determination by the Assessor.
Additional improvements completed during a period in which the improved property is subject to the previously granted exemption privileges in an amount less than the maximum deduction permissible shall be qualified for additional deduction privileges under terms and conditions herein specified; provided, however, that in no tax year shall the total deductions for any single property exceed $10,000.
A claimant desiring to seek the exemption to the above shall file a written application with the Tax Assessor of Somerdale pursuant to the directions of P.L. 1975, c.104.
Editor's Note: See N.J.S.A. 54:4-3.72 et seq.
[Adopted 12-13-2008 by Ord. No. 2008:12]
As used in this article, the following terms shall have the meanings indicated:
- That portion of assessed value of a property as it existed prior to construction of a building or structure thereon which is exempted from taxation pursuant to this article.
- The officer of the Borough of Somerdale charged with the duty of assessing real property for the purpose of general taxation.
- COMMERCIAL OR INDUSTRIAL STRUCTURE
- A structure or part thereof 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, 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 relocation from another qualifying municipality.
- The provision of a commercial or industrial structure, or the enlargement of the volume of an existing commercial or industrial structure by more than 30%, but shall not mean the conversion of an existing building or structure to another use.
- That portion of the successor'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 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 and which does not change its permitted use. In the case of a 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 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.
Exemptions from taxation for improvements to commercial or industrial structures may be granted upon review, evaluation and approval of each application on an individual basis by the governing body. In determining the value of real property, the Borough of Somerdale shall regard up to the Assessor's full and true value of the improvements 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.
Abatements from taxation for construction of commercial or industrial structures may be granted upon review, evaluation and approval of each application on an individual basis by the governing body and upon execution of an agreement which shall be entered into between the Borough of Somerdale and the developer in accordance with the procedures set forth in this article.
Contents of the application shall be as follows:
A general description of a project for which abatement is sought;
A legal description of all real estate necessary for the project;
Plans, drawings and other documents as may be required by the governing body to demonstrate the structure and design of the project;
A description of the number, classes and type of employees to be employed at the project site within two years of completion of the project;
A statement of the reasons for seeking tax abatement on the project and a description of the benefits to be realized by the applicant if a tax agreement is granted;
Estimates of the cost of completing such project;
A statement showing:
The real property taxes currently being assessed at the project site;
Estimated tax payments that would be made annually by the applicant on the project during the period of the agreement; and
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;
A description of any lease agreements between the applicant and proposed users of the project and a history and description of the users' businesses; and
Such other pertinent information as the governing body may require.
Upon adoption of an ordinance authorizing an agreement or agreements for tax abatements for a particular project or projects, the Borough of Somerdale may enter into written agreements with the applicants for the abatement of local real property taxes. An agreement shall provide for the applicant to pay to the municipality, in lieu of full property tax payments, an amount equal to a percentage of taxes otherwise due, according to the following schedule:
In the first full tax year after completion, no payment in lieu of taxes otherwise due.
In the second tax year, an amount not less than 20% of taxes otherwise due.
In the third tax year, an amount not less than 40% of taxes otherwise due.
In the fourth year, an amount not less than 60% of the taxes otherwise due.
In the fifth year, an amount not less than 80% of taxes otherwise due.
§ 233-11 Duration of agreements; applicability of other provisions; valuation; copy of agreement to be provided.
All tax abatement agreements entered into pursuant to this article shall be in effect no more than the five full tax years next following the date of completion of the project.
All projects 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 provisions, zoning, planning and building code requirements.
That percentage which the payment in lieu of taxes for a property bears to the property tax which would have been paid had an abatement not been granted for the property under the agreement shall be applied to the valuation of the property to be included in the valuation of the municipality for determining equalization for county tax apportionment and school aid during the term of the tax agreements covering the properties; and at the termination of an agreement for a property, the reduced valuation procedure under this section shall no longer apply.
Within 30 days after the execution of a tax agreement, a municipality shall forward a copy of the agreement to the Director of the Division of Local Government Services in the Department of Community Affairs.
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 abatement had been granted. The Tax Assessor shall notify the property owner and the Tax Collector forthwith, and the Tax Collector shall within 15 days thereof notify the owner of the property of the amount of taxes due. However, with respect to the disposal of the property, where it was 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 and the abatement shall continue, and the agreement shall remain in effect.
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 preference provided by law.
The Tax Assessor shall determine, on October 1 of the year following the date of the depletion of an improvement or construction, the true taxable value thereof. Except for projects subject to tax agreement as provided herein, the amount of tax to be paid for the first full year following completion shall be based on the assessed valuation of the improvement not allowed an exemption pursuant to this article. The property shall continue to be treated in the appropriate manner for each of the five full years subsequent to the original determination of the Assessor.
No exemption or abatement shall be granted pursuant to this article with respect to any property for which property taxes are delinquent or remain unpaid or for which penalties for nonpayment of taxes are due.
No exemption or abatement shall be granted pursuant to this article except upon written application therefor filed with and approved by the Assessor. Every application shall be on a form prescribed by the Director of the Division of Taxation in the Department of Treasury and provided for the use of claimants by the Borough of Somerdale and shall be filed with the Assessor within 30 days, including Saturdays and Sundays, following the completion of the improvements or construction.
Every application for exemption or abatement which is filed within the time specified shall be approved and allowed by the Assessor to the degree that the application is consistent with the provisions of this article, provided that the improvement or construction for which the application is made qualifies as an improvement or construction pursuant to the provisions of N.J.S.A. 40A:21-1 et seq.
The granting of an exemption or tax agreement shall be recorded and made a permanent part of the official tax records of the taxing district, which record shall contain a notice of the termination date thereof.
Pursuant to N.J.S.A. 40A:21-20, notice of the adoption of this article shall be included in the mailing of annual property tax bills to each owner of a dwelling located in the Borough of Somerdale during the first year following adoption of this article.