On October 1, 1979 the Director of the Division of Taxation issued his table of equalized valuations to be used by the State Commissioner of Education in the calculation and apportionment of state school aid distributions to New Jersey municipalities for the school year 1980-81. Union Township in Hunterdon County filed a complaint with this court pursuant to N.J.S.A. 54:1-35.4 seeking a review of the Director's determination of equalized valuation for the township. The complaint alleged that the Director had improperly excluded a particular sale of property from use in his study of the assessment practices in Union Township and that as a consequence the ratio of assessments to sale prices in the township as developed by the Director was incorrect. The Director's ratio for Union Township was 62.56% and the township urged that the ratio should be higher. The Director informed the court that inclusion of the sale in his computations would change the ratio for Union Township to 65.64%. The township's complaint requested the court to revise and correct the Director's table by incorporating into the appropriate computations the sale that the Director had excluded from his study.
The process by which the Director examines the assessment practices in New Jersey municipalities for purposes of the calculation and apportionment of state school aid distributions was thoroughly discussed in Bayonne v. Division of Tax Appeals, 49 N.J. Super. 230, 139 A.2d 424 (App.Div.1958). Cf. Willingboro v. Burlington Cty. Bd. of Tax., 62 N.J. 203, 300 A.2d 129 (1973). A municipality seeking the inclusion of a sale omitted by the Director in his study bears a heavy burden of proof because the Director is vested with wide discretion in fashioning the annual table. Kearny v. Division of Tax Appeals, 35 N.J. 299, 304, 173 A.2d 8 (1961). The Legislature has decreed that the presumption of the correctness of the Director's ratio for any taxing district shall not be revised or modified by this court "unless the complainant district shall present proof that upon all the evidence available such ratio... could not reasonably be justified." N.J.S.A. 54:1-35.4. The primary question in the present case is whether the Director erred in excluding a particular sale on the grounds that it fell within the confines of category 23 of his 27 categories of nonusable deed transactions. See N.J.A.C. 18:12-1.1. Category 23 provides that the following transactions are not usable in determining assessment-sales ratios pursuant to N.J.S.A. 54:1-35.1 et seq.:
Sales of commercial or industrial real property which include machinery, fixtures, equipment, inventories, goodwill when the values of such items are indeterminable.
The sale that Union Township seeks to have included in the Director's study was a sale of a commercial property used as a trucking company depot. The assessment on the property at the time of sale was $702,300. The consideration set forth in the deed was $418,000, resulting in a ratio of assessment to sale price for the single transaction of 168%. The deed contained a schedule with respect to allocation of the sale price of $418,000 which provided as follows:
The parties agree that the purchase price paid for the premises to be conveyed is to be allocated as follows:
60,000 pound truck axle scale $30,000.00
2,000 pound platform scale 45,000.00
40,000 pound air/il ram lift 15,000.00
Overhead service reels 2,000.00
Office air conditioning and heating equipment ...