On appeal from the Superior Court of New Jersey, Law Division, Bergen County.
Matthews, Crane and Antell. The opinion of the court was delivered by Antell, J.A.D.
Presented on this appeal is the question of whether certain lands owned by the County of Bergen are subject to local real estate taxation. The property consists of extensive acreage adjoining the Bergen Pines Hospital Complex, a county institution.
All property real and personal within the jurisdiction of this State not expressly exempted from taxation or expressly excluded from the operation of this chapter shall be subject to taxation annually under this chapter.
The statute under which Bergen County claims its right to exempt status is N.J.S.A. 54:4-3.3 which, insofar as applicable, provides:
Except as otherwise provided by article 1 of this chapter (§ 54:4-1, et seq.), the property of the State of New Jersey; and the property of the respective counties, school districts and taxing districts used for public purposes * * * shall be exempt from taxation under this chapter. [emphasis supplied]
For the exception to apply it is required that there be not only public ownership of the property but that the property be "used for public purposes." As we held in Jersey City v. Jersey City Parking Auth. , 138 N.J. Super. 442, 444 (App. Div.), aff'd o.b. 71 N.J. 492 (1976) the statute conditions the exemption upon "the coalescence of public ownership and public use."
That the property must be used for public purposes has been settled for many years. Jamouneau v. Division of Tax Appeals , 2 N.J. 325, 332 (1949); Teaneck Tp. v. Division of Tax Appeals , 10 N.J. Super. 171, 174 (App. Div. 1950). The rule is also applied under other statutes allowing tax exempt status to autonomous agencies. Moonachie v. Port of N.Y. Auth. , 38 N.J. 414, 426-27 (1962); Port of N.Y. Auth. v. Newark , 20 N.J. 386, 394 (1956); New Jersey Turnpike Auth. v. Washington Tp. , 16 N.J. 38, 44 (1954);
Jersey City v. Jersey City Parking Auth., supra , 138 N.J. Super. at 444.
Tax exemption statutes based on the personal status of the owner rather than on the use to which the property is put are barred by the tax article of our Constitution which provides that "Property shall be assessed for taxation under general laws and by uniform rules." N.J. Const. (1947), Art. VIII, § I, par. 1(a). N.J. Turnpike Auth. v. Washington Tp., supra , 16 N.J. at 44-45. Because "[a]ny impairment of the taxing power affects the lifeblood of government * * * claims for tax exemption have to stand scrutiny to show that they serve a public purpose." Id. at 44. The burden of proof rests upon the one asserting a tax exemption to establish the right. Jamouneau v. Division of Tax Appeals, supra , 2 N.J. at 330.
The economic basis for this interpretation is outlined in the following language of Moonachie v. ...