On appeal from Division of Tax Appeals in the Department of the Treasury, certified to this court on its own motion.
For reversal -- Chief Justice Vanderbilt, and Justices Heher, Oliphant, Wachenfeld, Burling, Jacobs and Brennan. For affirmance -- None. The opinion of the court was delivered by Brennan, Jr., J. Vanderbilt, C.J. (concurring). Vanderbilt, C.J., and Heher, J., concurring in result.
The Borough of Little Ferry appeals from the dismissal by the Division of Tax Appeals of its complaint under N.J.S.A. 54:2-37 for the review, and correction and revision, of the 1954 equalization table promulgated by the Bergen County Board of Taxation. We certified the appeal of our own motion while the appeal was pending in the Appellate Division.
The judgment of the Division will be reversed and the cause remanded with direction to the Division to revise and correct the 1954 Bergen County equalization table in further proceedings pursuant to N.J.S.A. 54:2-37 conducted according to the principles more fully set forth in our decision filed herewith in City of Passaic v. Passaic County Board of Taxation, 18 N.J. 371 (1955).
The Bergen County Board of Taxation prepared a preliminary equalization table which was submitted to the local assessors and representatives of the local governing bodies at a meeting on January 25, 1954 called pursuant to N.J.S.A. 54:3-17. The table showed increases in the aggregates of real estate valuations appearing on the duplicates of 41 taxing districts, decreases in the aggregates of 6 municipalities, and no change in the aggregate of 23 taxing districts. The aggregate shown on the Little Ferry duplicate was increased $478,102, or 15% above the submitted aggregate of $3,187,350.
The presiding member of the board, Mr. Moss, addressed the meeting when it commenced. His statement shows that the board is fully aware of the nature of the equalization function and the reason underlying the requirement, and the board's duty in the premises. The statement correctly observes:
"This preliminary equalization table and the final table to be adopted by March 10th is not an order by the Board to assessors to increase or decrease valuations. The ratios or percentages shown on these tables are simply for the proper distribution of county tax -- it does not mean that an assessor must increase or decrease the assessments in his books by such percentages. It is merely a mathematical
operation to equitably distribute to every taxpayer a fair and just share of the county tax levy. The purpose of this table is just what we have so often told you -- a means of bringing about an equalization of values for payment of county tax. You as assessors know there are many districts in the county that have escaped paying a fair share of the county tax burden by keeping valuations at a low figure." [Emphasis supplied]
Mr. Moss also revealed that in the preparation of the table, "We have exerted every effort to comply with the instructions and suggestions of the State Director [of the Division of Taxation] and have used the best known sources in arriving at the table we have adopted." The error into which the board fell, at that meeting and at the several adjourned meetings held before the preliminary table was finally adopted on March 10, was in failing to disclose, and affording the local assessors and local representatives a fair opportunity to meet, the data obtained from the "best known sources" referred to. And the Division of Tax Appeals compounded the error in the proceeding before that body in acquiescing in the position taken by the Attorney-General that the county "board isn't to present facts to the taxing district. If the taxing districts have any objections they are to present them to the board. He is asking what factual data was presented by the county board. It should be the converse and the statute implies it to be."
For the reasons stated in City of Passaic v. Passaic County Board of Taxation, supra, it was the duty of the county board to lay before the meeting of January 25 the data underlying the determinations of average assessment ratios and to afford the taxing districts fair opportunity both for refutation of such data, and to present their own. A municipality has the right not only to challenge the ratio determined for it, but also, under N.J.S.A. 54:3-18, "at the first hearing * * * may object to the ratio or valuations fixed for any other district, but no increase in any valuation as shown in the table shall be made by the board without giving a hearing, after three days' notice, to the governing body of the taxing district affected."
The error was fatal to the proceedings and particularly unfortunate because the county board commendably undertook a comparison of 26,000 property sales in Bergen County in determining the average assessment ratios and in bringing them into equivalence on the basis of 25% of true value. This was not discovered, however, until upon the request of this court on the oral argument it was revealed to the Attorney-General and the attorney for the borough and ...