More Oversight of Tax Exemptions Needed in NJ

The Office of the State Comptroller has released a new audit today. It takes a look at tax exempt property in three towns. The probe finds that exemptions had been granted to 11 properties that are not eligible for them.

“Every time a municipality exempts a property from taxation, other property owners fill the resulting revenue gap,” said State Comptroller Matt Boxer. “It’s important that local tax officials continually monitor exempt properties to ensure that they still qualify for that status.”

The audit uncovered seven properties in Paterson and four in Middletown that were no longer being used for a tax exempt purpose. Those properties have since been returned to the tax rolls as a result of the audit. The total value of the 11 properties is over $2 million and would have generated more than $50,000 in tax revenue.  The third town included in the review was Bridgeton, but no improper exemptions were found.

Under state law, property used for religious, charitable or other non-profit purposes is exempt from property taxes. Tax exempt properties currently make up almost 12 percent of all assessed property value in the state.

Based on the audit’s conclusions, Boxer is urging local officials to use more caution before giving properties tax exempt status.