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.
In 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.
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.