Lynch, Larner and Fulop. The opinion of the court was delivered by Lynch, P.J.A.D.
The City of Clifton appeals from the action of the Division of Tax Appeals adopting the Preliminary*fn1 Equalization Table considered by the Passaic County Board of Taxation (county board) on February 1, 1974, as the proper equalization table for 1974, and declaring null and void the Final Equalization Table which the county board had adopted on March 11, 1974.
As will be seen, before the hearings in the Division opened the county board advised the Division that it had been in error in its adoption of the Final Table and that it agreed that adoption of the Preliminary Table was the correct course.
The difference between the County Board's Preliminary and Final Tables was that the Preliminary Table utilized the ratios computed for each taxing district by the Director of the Division of Taxation ("Director's average ratio") to determine the 1972 true value of real property in all taxing
districts of Passaic County for 1974 County equalization purposes, whereas the Final Table used the so-called "page 8" formula*fn2 to determine the 1972 true value for 1974 equalization purposes of Clifton, Hawthorne, Passaic and Paterson ("Clifton Districts").*fn3 The 1972 true value is a factor in determining the 1974 equalization tables. See Willingboro v. Burlington Cty. Bd. of Taxation , 62 N.J. 203, 211-213 (1973).
When the county board adopted the Final Table the eight respondent taxing districts filed a petition with the Division challenging the equalization ratios that had thereby been adopted. As we have said, at the beginning of the hearings in the Division the county board stated that it had concluded its Final Table was in error and that the Preliminary Table was the correct one. The City of Clifton was thereupon substituted as the primary defender of the Final Table. The Division approved the Preliminary Table. Clifton alone appeals that decision.
The issue here is whether the true value established by the page 8 formula for the Clifton districts in 1972, a year in which they effected a complete revaluation, may be used by a county board when computing the equalization ratio for those taxing districts in subsequent years (here 1974) in a situation where the board does not use the page 8 formula for the remaining taxing districts in the county.
In an inflationary period such as the present, a taxing district permitted to use the page 8 formula in a nonrevaluation year will benefit substantially. See Willingboro, supra , 62
N.J. at 222-223. For instance, application of the page 8 formula to Clifton for the tax year 1974 would reduce its equalized true value from $1,109,026,937 to $1,051,744,239, a reduction of some $57,000,000. The decision of the Division recites that this would mean a savings for Clifton of $400,000 in county taxes and the concomitant transfer of that burden to other Passaic communities.
The rule in this State is that a method of equalization is acceptable only if it is "fair over the long run and substantially free from disparity of method as between taxing districts." Willingboro, supra , 62 N.J. at 227. Therefore, in approaching the question here we must focus on the comparative treatment afforded taxing districts that revalued in a particular year as against those that did not.
In 1970 ten districts in Passaic County revalued, and in each of the years after 1970 the Director's average ratio was used to compute the equalization ratios for those districts. In 1972 the Clifton districts revalued. As we have said, in adopting its 1974 Final Equalization Table for those districts the county board used a 1972 true value computed not on the basis of the Director's ratio but rather pursuant to the page 8 formula. The issue therefore reduces itself to the propriety of ...