Simpson, J.c.c. (temporarily assigned).
[108 NJSuper Page 286] In these four consolidated cases a number of municipalities and one individual taxpayer challenge the constitutionality of N.J.S.A. 54:11 D -7. This statute is part of the so-called business personal property tax replacement program. Pursuant to N.J.S.A. 54:11 D -1 the revenues from the unincorporated
business tax, the state-assessed tax on business personal property, the retail gross receipts tax and a portion of the corporation business tax are distributed to the municipalities of New Jersey "in replacement of the revenues derived by such municipalities from the local taxation of personal property used in business."
There is no objection, constitutional or otherwise, to the revenue replacement principle, or the manner of determining and distributing the amounts thereof. The dispute concerns a portion of N.J.S.A. 54:11D-7 which provides:
For the purpose of apportioning the amounts to be raised in the respective taxing districts of the county under Revised Statutes 54:4-49, the county board of taxation shall, for each taxing district, include in the equalization table for the county the assumed assessed value of the property represented by the money received by each taxing district pursuant to the provisions of this act.
Commencing with the tax year 1969 and thereafter the assumed assessed value of such property in each taxing district shall be determined by the county board of taxation in the following manner: (a) the amount of money received by each taxing district during the preceding tax year pursuant to the provisions of this act, shall be divided by the general tax rate of the taxing district for such preceding tax year to obtain an assumed assessed value of such property; (b) this assumed assessed value shall be divided by the fraction produced by dividing the aggregate assessed value by the aggregate true value of the real property, as determined by the county board of taxation for equalization purposes in the current tax year, exclusive of Class II railroad property, in the taxing district; and (c) the resulting quotient shall be included in the net valuation of each taxing district on which county taxes are apportioned.
Plaintiffs contend that the process whereby the "assumed assessed values" of their replacement revenues are calculated for inclusion in the equalization tables by the county boards of taxation in arriving at apportionment valuations for county tax purposes, is unconstitutional. Defendants are four county boards of taxation, the Director of the Division of Taxation, and some municipalities that benefit from the current application of the statute.
A number of schedules, containing many figures and percentages, were introduced into evidence by the City of Clifton.
This municipality in 1969 received $2,630,916. in replacement revenues, or 33.0689% of the total for all municipalities in Passaic County. For the same year Clifton paid $728,527, or 45.5263% of the total Passaic County taxes allocated to the "equalized assumed assessed value" of replacement revenues of the municipalities in that county. In addition, the following significant figures appear for that city:
Percentage Percentage Percentage General ...