| 
INTRODUCTION
101. A Brief History of County Boards of Taxation
(From "County Tax Board Handbook")
County boards of taxation have been in operation for more
than 75 years. Even so, in a relative sense, they are newcomers
in the administration of the property tax. Nevertheless, the
functions they perform have histories that go back many years.
The concept of county boards of taxation was perhaps first
articulated by Governor George F. Fort in 1854. Governor Fort
in his annual message for that year observed, " ...some
better mode of obtaining a fair and equal assessment of real
and personal estate should be devised". As originally
envisioned by the Governor a "committee of revision"
consisting of three "reputable citizens" were to
be elected in townships to meet annually with the assessor
for the purpose of equalizing and correcting the valuation
of real and personal property.
Governor Fort further recommended establishment of a "county
board of revision" to perform similar functions, equalizing
and correcting property tax assessments, on a county wide
basis.1
Establishment of county boards of taxation in 1906, represented
the combination and synthesis of separate duties formerly
performed by several separate agencies into a single agency.
One of the duties assigned to the newly formed county boards
of taxation was that of hearing and ruling on tax appeals
filed with them by aggrieved taxpayers or municipalities from
assessments placed by assessors upon property within the county.
For many years prior to the establishment of county boards
of taxation, appeals from property tax assessments were filed
with local "Commissioners of Appeal". It was the
specific and sole responsibility of the Commissioners of Appeal
to hear and determine appeals from assessments. Commissioners
of Appeal were specifically provided for in the first Constitution
of New Jersey adopted July 2. 1776. Their powers and methods
of procedure were further delineated by the State Legislature
(Legislative Council and Assembly) in June 1777. Commissioners
of Appeal were originally required to be chosen for each township
at the annual town meeting of each township. The 1776 constitution
provided for the choosing of Commissioners of Appeal in the
following language:
"
three or more judicious Freeholders ("Freeholders"
= land owners) of good character to hear and finally determine
all appeals relative to unjust Assessments in Cafes public
Taxation; which Commissioners of Appeal " shall, for
the purpose, sit at some suitable time or times to be by them
appointed, and made known to the People by Advertisements."2
The Commissioners of Appeal were required to issue a "transcript"
of their judgment to the appellant in any appeal where a reduction
was granted and the transcript was to be a "sufficient
voucher" to the appellant for his presentation to the
Collector of the township for a reduction of his tax bill.
In case of a vacancy among the Commissioners of Appeal in
any municipality the vacancy was to be filled by the appointment
of "some other fit person" selected by "the
two chosen Freeholders of such Township, in Conjunction with
one Justice of Peace of the County".
Any costs incurred by the Commissioners of Appeal were to
be assessed against the township if the appellant was successful
or even partially successful in his appeal, or against the
appellant where no reduction in the assessment was granted.
Possibly a part of the costs would have been the wages payable
to the Commissioners of Appeal which were set in the law at
"
the Sum of Six Shillings per Day
"
for each Commissioner.3
Commissioners of Appeal remained a part of the fabric of
New Jersey's property tax system until the advent of county
boards of taxation. They were an established part of municipal
government which during their 130 years of existence performed
one of the principal functions of present day county boards
of taxation, that of hearing and determining property tax
appeals.
Another of the present functions of county boards of taxation,
that of equalization of property tax ratables in the aggregate
for apportionment of shared budgets, was also set up many
years ago. Unlike the hearing of appeals however, the equalization
function was set up to be carried out at the county level
rather than at the municipal level of government just as it
is today. It was the local assessors, however, of municipalities
situated in the county acting as a body who were responsible
for carrying out the equalization function. In accordance
with an enactment of the Legislature in 1799, w hen any money
was required to be raised for state or county purposes each
assessor was required to attend an annual meeting and to produce
his "duplicate" showing the value of real and personal
property as he had assessed them. The assessors at this meeting,
in accordance with the law, had the further duty to:
". ..Compute and ascertain the whole value of real and
personal estate
taxed according to the value thereof
contained in the duplicates of the several assessors
and to fix and adjust the proportion
of tax to be levied
and collected in each township
in proportion to said
value; provided that if it shall appear to the assessors (attending
the meeting) that the value of the property contained in any
duplicate is relatively less than the value of other property
in the county, they may, for that purpose of fixing
the said proportion ... and for that purpose only, add to
such percentage as shall appear to them just and proper
"4
Since no objective guidelines were set forth in the law for
equalizing the figures in an assessor's "duplicate",
one can only wonder what the reactions were when a majority
of the assessors in a particular county came to the conclusion
that the aggregate value shown in one assessor's duplicate
was less by comparison than the aggregate values shown in
the duplicates of the other municipalities and then proceeded
to increase that particular municipality's aggregate ratable
value and thereby its share of the county budget. One such
meeting of the assessors of a county is recorded in the New
Jersey Courier of September 11, 1902 as follows:
"At the annual meeting of the County Board of Assessors
held at the Court House Sept. 2nd inst., the subjoining table
of aggregates was agreed upon for the current year.
Resolved that the tax budget of $70,000.00 recommended by
the Board of Chosen Freeholders be raised on the real and
personal property only excluding the polls.
Resolved to add ten per cent to the real and personal valuations
reported by the assessor of Union Township.
Resolved that the clerk notify absent assessors to appear
at the office of the county clerk at an early date and make
affidavit and subscribe their names to the abstract of ratables
as required by law.
The clerk of the township committee of Manchester Township
reported to the Board that the assessor had removed from the
township, that a proper assessment of the township had not,
to their knowledge been made, that in their judgment values
had not increased in the township and that polls had decreased
about fifty owing to removals from the township. They recommend
that valuations for Manchester be made the same as last year,
and the polls fifty less than last year.
Resolved that this recommendation be adopted, and that the
clerk notify the township committee of Manchester to send
at once to the county clerk's office a properly authorized
official to sign and make oath to the abstract of ratables.
Resolved that in the assessment of next year, every dog owned
in the county shall be taxed; that every assessor should be
present at the next annual meeting of the Board, that each
page and each column of his duplicate must be properly added
and footed at the bottom thereof, and the duplicate properly
verified by oath or affirmation, and
Resolved that it shall be the duty of each assessor to bring
to the annual meeting an accurate table of the footings of
his duplicate arranged in the order of this abstract of ratables
and showing each item separately, and to hand said table to
the clerk of the Board at the opening of the session".
5
It may be noted from the above newspaper account, the assessors
attending the annual meeting apparently arbitrarily raised
Union Township's ratables ten percent. Unfortunately in this
strictly factual account, reactions, if any, are not recorded.
Possibly the assessor from Union Township was one of those
not in attendance at the meeting. It would seem unlikely that
such an action could be successfully accomplished if a meeting
such as this were to be held today.
Still another important function of present day county boards
of taxation, that of supervision of assessors, was originally
set up to be carried out at the State level of government.
The State Board of Taxation established in 1891 had authority
to direct an assessor to reassess a property deemed to have
been improperly assessed and if an assessor failed or refused
to comply with an order given by the State Board of Taxation
the Board was empowered to "appoint some other person"
to make the new assessment. The State Board of Taxation also
had the duty to investigate methods adopted by local assessors
in arriving at their values.6
The State Board of Taxation was abolished in 1905, and its
duties were taken over by the State Board of Equalization
of Taxes. The State Board of Equalization of Taxes made some
attempts along supervisory lines, but evidently realized very
quickly that closer supervision than they could provide was
required. In the first annual report of the newly created
State Board of Equalization of Taxes a suggestion was put
forth by one of the board members. Mr. E. A. Armstrong, that
a "Board of Assessors" should be created in each
county to assess all property which was then locally assessed.
He and the other board members felt this change would be the
key to equal distribution of the tax burden, and would quiet
complaints of "municipalities against townships and municipalities
against each other". This suggestion was made in 1905.7
In 1906, the Legislature enacted legislation creating county
boards of taxation. 8
The second annual report of the State Board of Equalization
of Taxes published in 1907, looking back, cited Mr. Armstrong's
suggestion for a county board of assessors. The report went
on to say that while the Legislature did not adopt Mr. Armstrong's
re- commendation in its entirety. it did approve the underlying
principle by enactment of the legislation creating county
boards of taxation. The State Board of Equalization of Taxes
thereby seemed to take credit upon themselves for being the
conceptual force which led to the establishment of county
boards of taxation by the Legislature. The State Board of
Equalization of Taxes seemed' particularly pleased with the
creation of county boards of taxation. In their 1906 annual
report the State Board of Equalization of Taxes said the exercise
of legal powers granted to county boards of taxation in the
statutes " ...justifies in the critical observer the
belief that the work of these
County Boards will be of powerful influence in rehabilitating
the taxing system of New Jersey
" The State Board
of Equalization of Taxes went on to illustrate by actual example
how well county boards of taxation, although only newly created,
were working:
"For example, the State Board issued an order directing
that, with the exception of farm lands, land and the improvements
thereon should be valued separately, and that the value of
the land and the value of the improvements should be placed
in separate columns in the assessment list and duplicate.
The greater accuracy and uniformity of valuations obtainable
by the employment of this method is obvious, and most of the
assessors in the State com- plied with the direction. In a
number of instances, however, assessors, through negligence,
indolence or even obstinacy, continued in the old-fashioned,
haphazard manner, and the State Board was unable to discover
and correct all such instances. Now, however, the books of
the assessors in each instance come directly under the eyes
of the County Boards, and this direction has in consequence
been much more extensively obeyed". 9
As county boards of taxation first became operable, there
was great interest and apparently some trepidation as the
new boards assumed their duties. In August 1906, Governor
Stokes addressed a letter to each of the newly formed county
boards of taxation in which he asked that a "square deal"
be given to every taxpayer. The Governor warned of the danger
of over-taxation, declaring that county boards are, "
...dealing with what next to life and limb is a most sacred
right, namely, that of property. The power of taxation is
practically the power of confiscation." The Governor
went on to say, "The opportunity afforded you for rendering
service to the people is one that should enlist your most
earnest and conscientious efforts" .The Governor also
instructed the county boards that they, "
like the
courts, must so conduct their business as to be beyond suspicion
of permitting any kind of favoritism."10
County boards of taxation began the exercise of their duties
with an evident degree of zest. An article in the Cape May
Wave of June 2, 1906, reports the newly formed Cape May County
Board of Taxation held a meeting with the municipal tax assessors
of the county on a Saturday afternoon and outlined to the
assessors what the board expected of them. The article states
the assessors were surprised upon being instructed by the
Board of Taxation that they must assess all property at its
"full valuation". The article also reports that
printed lists' of articles of personal property to be assessed
were to be sent to the tax assessors for distribution to individual
taxpayers. Taxpayers were to fill in the blank spaces, reporting
what items of personal property they owned. Among the items
to be reported were: the number of mortgages held by the taxpayer;
his bond holdings; bank stock; jewelry; money in the bank
and on hand; the number of automobiles owned by the taxpayer.
Any success the county board of taxation and the assessors
achieved in gaining taxpayer compliance in this enterprise
is not reported .10
As with any attempt at change, the newly created county boards
of taxation had their detractors. A 1906 editorial in a southern
New Jersey newspaper states:
"Politics has long played an important part in legislation,
but never in a more patent manner than in the measure which
was passed at the last session of the Legislature and which
created the county boards of taxation
Instead of remedying
the irregularities in valuation and assessments, the bill
promises to make these more unjust
(County Boards of
Taxation) have the authority to finally decide on just what
the assessment shall be on any property in the county, and
this notwithstanding they may never have seen the property
in question. Now, then, does an assessor from the northern
part of the county know the true valuation of a property in
the southern part, which he has never seen? I say, no. The
man who assessed the property might as well be a resident
of California and assess by correspondence."11
Despite evidence of some early criticism, county boards of
taxation gradually won approval by demonstrating their effectiveness
in improving administration of the property tax. The early
suspicion with which they were regarded ultimately turned
to grudging admiration. This is perhaps nowhere better epitomized
than in an address, by Governor James F. Fielder (1913-1917).
In 1916, the State Board of Taxes and Assessments (successor
to the State Board of Equalization of Taxes) called a Conference
of taxing officials of the State, namely members of the county
boards of taxation and tax assessors. Governor Fielder in
the opening address of the Conference had the following to
say about county boards of taxation:
"I am very glad to find that the County Tax Boards are
very much in favor everywhere over the State then they used
to be. I believe they can be made a part of the machinery
that has to do with taxation that will be very effective for
the benefit of the people taxed. I feel that the County Tax
Boards were originally designed for political purposes, that
the thought was at the time they were instituted that the
railroads were to be assessed upon the average tax rate of
the State or some of their property assessed at that average
tax rate, that the real purpose of the County Tax Board was
to keep the tax rate down so that the average tax rate would
be low for the benefit of the railroads of the State. But
that reason for existence of the County Tax Board has disappeared
and the members of the Boards have begun to realize that they
have a real function to perform; they have a real duty through
which they can be of real service to the people. The result
has been according to my observation, that the members of
the County Tax Boards have given intelligent thought and study
to the performance of their duties. For myself, I would enlarge
their powers and their scope. I would make them more of an
important factor in our counties, and among other things,
I would give the County Tax Board the right to remove a negligent
and incompetent or a corrupt assessor
"12
County Boards of Taxation have been described as the current
descendants of numerous efforts to achieve several aims: to
develop inter-municipal equalization of assessments within
counties; to provide the basis for effective supervision of
the assessors within counties; and to provide a review mechanism
of individual assessments.1
In the years since their establishment county boards of taxation
exercised with varying degrees of effectiveness supervision
of local tax assessors. Also, county boards of taxation carried
out their functions as a review and hearing body for appeals
from local tax assessments. Nevertheless, even though equalization
as between municipalities within a county was a part of New
Jersey law for many years. it was not until the mid 1950's
that county boards of taxation were generally effective in
providing such equalization. In a poll taken in the early
1950's county boards of taxation were asked to report any
activity they had undertaken to equalize the ratables of municipalities
within their jurisdiction for the purpose of fairly apportioning
the burden of county government and other shared budgets.
The replies ranged from. "None that I know about",
and "There have been no such studies to my knowledge",
to explanations of a rudimentary comparison of property sales
prices to assessed values of properties which were sold being
conducted in just two counties .1
It is evident that while equalization in the aggregate as
between municipalities within each county' is now commonplace
almost to the point of being taken for granted, it was at
one time not too long ago regarded with indifference or even
felt to be impossible to accomplish, The advent of the assessment/sales
ratio program (see Section 402, County Tax Board Handbook)
in 1954 finally gave county boards of taxation the means needed
to accomplish an effective equalization of assessed values
of each municipality ,within their respective jurisdictions.
County boards of taxation eagerly grasped the opportunity
to carry out equalization as between municipalities so that
in 1955 distribution of county budgets in proportion to respective
municipal equalized valuations was an accomplished fact.
County boards of taxation have by now become such an integral
part of the administration of the property tax in New Jersey,
that it is indeed difficult to envision how the tax remained
functional or even continued to exist prior to their formation.
For many years' county boards of taxation operated essentially
as 21 separate agencies with little or no contact or coordination
of one board with another. Each county board of taxation drew
up its own rules, subject to approval by the Director of the
Division of Taxation, promulgated its own forms and developed
and followed its own procedures.
As particular problems or questions arose concerning either
administration of the property tax or appeals from the property
tax, it became common for one county board of taxation commissioner
or secretary (now administrator) to contact a commissioner
or secretary in another county for advice or for the benefit
of any experience which that county board may have had with
the particular problem. This led first to informal meetings
between members and secretaries of county boards of taxation,
and eventually to the formation of an association called the
New Jersey Association of County Board of Taxation Commissioners
and Secretaries.
Although no written record can be found of the early days
of the Association of County Board of Taxation Commissioners
and Secretaries, indications are the Association was formed
about 1947. Annual meetings of the Association, at least,
commenced during that year.13 The early annual meetings were
held in Atlantic City.
I n the lat e 1940's, at the request of Aaron Neeld, Director
of the Division of Taxation, a committee composed of members
of the Association of County Board of Taxation Commissioners
and Secretaries began meeting on a monthly basis in Trenton.
Meetings were originally held in the Stacy-Trent Hotel, which
stood on the present site of the Division of Taxation Building
.The committee, called the Director's Cooperating Committee
of County Board of Taxation Commissioners and Secretaries,
had as its purpose advising the Director in property tax matters
and policy.
The monthly meetings of the Cooperating Committee and annual
meetings the Association have continued down through the years,
and have served not only to advise the Director of the Division
of Taxation but also to inform County Board of Taxation Commissioners
and Administrators of current property tax matters such as
recent property tax court decisions, legislation and rules
and regulations which have been promulgated. Through the exchange
of ideas, experiences and expressions of need, implementation
of a number of property tax programs have been adopted and
carried out. Some examples are the assessment-sales ratio
program, equalization for the apportionment of certain tax
levies which are shared by two or more municipalities, the
farmland assessment program, the senior citizen deduction
and many others. Through the sharing of ideas, the meetings
also tended to make administration of the property tax more
uniform throughout New Jersey.
Indeed the keynote in county board of taxation operation in
more recent years has been uniformity in the administration
of the property tax from county to county. Illustrative of
this was the adoption of statewide uniform rules by county
boards of taxation in 1974. Under legislation enacted in that
year rules were drawn up by the Director of the Division of
Taxation in cooperation with representatives of the Association
of County Board of Taxation Commissioners and Secretaries,
the New Jersey State Bar Association and the Association of
Municipal Assessors of New Jersey. These rules have been amended
from time to time, but are still in effect today, and ensure
that a taxpayer moving from one county to another will receive
substantially the same treatment before whatever county board
of taxation he might appear.14
Still another example of the trend toward uniformity in county
board of taxation operation was the adoption of uniform statewide
tax appeal forms, uniform instructions for completion of the
petitions of appeal and uniform forms of memorandum of judgment.
At this point county boards of taxation have earned for themselves
a vital, necessary and respected position in the efficient
administration of the property tax in New Jersey.
REFERENCES:
1. Sixth Report of the Commission On State T ax Policy, 1953.
2. 'Constitution of New Jersey, Agreed upon in Provincial
Congress, Burlington, July 2, 1776.
3. Chapter 34, Laws of 1777.
4. An act concerning taxes. Passed the l0th of June 1799.
Pat. 404.
5. New Jersey Courier, September 11, 1902.
6. Chapter 114, Laws of 1891.
7. First Annual Report of the Board of Equalization of Taxes
of New Jersey, 1905.
8. Chapter 120, Laws of 1906.
9. Second Annual Report of the Board of Equalization of Taxes
of New Jersey, 1906.
10. Cape May Wave. June 2, 1906.
11. Cape May Wave. September 1, 1906.
12. Board of Taxes and Assessments, First Annual Conferences
of Officials of the State of New Jersey Charged with the administration
of the Tax Laws, 1916.
13. Deep In The Heart Of Taxes. April 1958.
14. Rules For County Boards of Taxation. April 17, 1974.
|