Tax Refunds Plummeted by Nearly $1M in 2012

Fair Lawn refunded nearly $1 million less in taxes to residents and business owners in 2012 than it had the year prior, according to borough finance data obtained by Patch.

The substanial decrease, which contributed significantly to replenishing the town's fragile surplus, can be tied directly to a boroughwide property reassessment undertaken last year that reduced the town's rateable base by 18.4 percent.

Tax assessor Tim Henderson called the $371,500 reassessment, which re-aligned the borough's assessed property values with market values, a "huge success."

"It eliminated our exposure on residential appeals especially," he said. "We still have commercial ones that are at the state but we feel we’ll be pretty successful with those, too."

Fair Lawn's residential tax appeals, which grew eight-fold from 2008 to 2011, were down nearly 80 percent in 2012, according to borough tax data.

The borough hasn't refunded so little in taxes since 2007, the last time its properties were revalued.

2007

While the number of successful appeals are likely to climb in coming years as the real estate market evolves, Henderson said he believes this reassessment will have more staying power than the 2007 revaluation.

"The difference between this reassessment and last time is, I think the market was declining more rapidly before," he said. "I think [the market] is going to be more stable, and if it does come down, it’s not going to come down at the same rate — it's not going to come down 5, 10, 15 percent here like it was in some cases."

Even if refunds remain manageable for the next couple years, the borough's nearly $1 million savings on tax judgments in 2012 is a one-time windfall, much like reimbursements from Hurricane Irene that also allowed Fair Lawn to grow its surplus by $1.5 million last year.

Because those windfalls can't be counted on to continue, borough manager Tom Metzler and chief financial officer Karen Palermo have said it's essential that council sticks to the plan set forth in this year's budget if they want to maintain a strong surplus going forward.

"I need somebody in this position that’s going to keep this plan," Palermo said in a plea to council during a budget session last month. "It’s really important, because the minute we deviate, the minute it goes against any policies, any procedures we’ve established in this budget, I’m begging, I’m standing right in front of all of you and saying it’s not going to work."

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