On appeal from final judgments of the Tax Court of New Jersey.
Allcorn, Francis and Morton I. Greenberg. The opinion of the court was delivered by Francis, J.A.D.
This matter involves appeals by the Township of Rockaway from two judgments of the Tax Court. The same single issue is addressed in both appeals and we have therefore consolidated them on our own motion. In each instance Rockaway challenges the determination of the Tax Court as to the approach utilized by that court in evaluating a portion of each of the two taxpayers' acreage for property tax assessment purposes. Both tracts are situate in Morris County and generally surround Green Pond Lake in Rockaway Township. Lake End Corporation, one of the taxpayers, owns approximately 338 acres at the southerly end of the lake. Green Pond Corporation owns approximately 890 acres located on the northerly end of the lake. The holdings of these two taxpayers are generally contiguous in the vicinity of the lake. Some basic factual background as to each of the tracts, their acquisition and the manner in which certain leaseholds came about is appropriate.
The property owned by Lake End Corporation consists of 338 acres situate on the southwesterly end of Green Pond Lake.
The property is approximately three miles south of State Highway 23 and approximately ten miles north of Interstate Highway 80. The property consists of a large tract of woodland. The focal point of the property is Green Pond Lake, a natural lake approximately 2.5 miles long, encompassing slightly more than 500 acres. The lake is spring fed and is characterized by the township as being in excellent condition. Approximately one-fourth of Green Pond Lake, 125 acres, is owned by Lake End Corporation. The remainder of the property surrounding Green Pond Lake is owned by Green Pond Corporation, a lake community similar to Lake End and described hereafter.
Numerous residences have been constructed on the property, some of which appear to be substantial. The property is served by a private road, electric service and telephone service and police and fire protection. Water is provided by private wells and sewage is treated by on-site septic systems.
Lake End Corporation was established in 1924 to purchase the entire 338 acres. Its shareholders were the individuals who were then leasing parcels of property from the previous owners. After the corporation purchased the property, the corporation leased a designated lot to each of its shareholders for a period of 99 years. This relationship continues to the present. The owners of the 99-year leaseholds are the sole shareholders of the corporation.
Lake End Corporation property consists of three major segments:
(1) The developed residential area, consisting of approximately 63-64 acres;
(2) 105 acres leased to the United States Government and an additional 45 acres which separate the government-leased property and the residential lots, and
(3) 125 acres located under Green Pond Lake.
There is no dispute as to the improvements on the developed residential area. These have always been assessed to the leaseholders. The dispute concerns the land on which the improvements have been built, which is assessed separately to each of the respective corporations.
Green Pond Corporation and Green Pond Mountain Corporation
Green Pond,*fn1 the other taxpayer, owns approximately 890 acres located on the northerly end of Green Pond Lake. This acreage has been acquired in fragments through the years. Roughly three-fourths of the lake itself is owned by Green Pond. Of the remaining property owned by Green Pond, approximately 50 acres are occupied by some 255 homesites and it is this area or tract that is in dispute. As in Lake End, many of the residences constructed on these homesites are substantial. Another 20 acres in the "village area" contain such amenities as a ...