On appeal from the Superior Court of New Jersey, Law Division, Essex County, L-000732-03.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted October 29, 2007
Before Judges Stern, A. A. Rodríguez and C. S. Fisher.
David Schnegelberger, Florence Schnegelberger, William Stewart, Anna Stewart, Archibald Williams, Burnell Williams and Migdalia Perez (plaintiffs) are a group of residential property taxpayers in Newark. They commenced this action in lieu of prerogative writs (mandamus) "on behalf of themselves and as representatives of a class consisting of [Newark] residential property taxpayers[,] against the City of Newark, its former Mayor Sharpe James, the Municipal Council (collectively "Newark") and the New Jersey Department of Community Affairs (DCA).*fn1 Plaintiffs alleged that Newark collected approximately $180 million in parking and payroll taxes beginning in October 1, 2000, pursuant to the Revaluation Relief Act of 1999, N.J.S.A. 54:1-35.51 to -35.55 (1999 Act), repealed by L. 2004, c. 181, § 1, eff. Dec. 22, 2006. It is undisputed that the 1999 Act imposes a restriction or limitation on the revenues collected, i.e., they are to be "used for the sole purpose of funding revaluation relief" abatements. N.J.S.A. 54:1-35.54. The 1999 Act further provides that:
The procedures and safeguards to implement the requirement that funds be used for the sole purpose of funding revaluation relief shall be as the Director of the Division of Local Government Services in the Department of Community Affairs shall prescribe. [Ibid.]
Plaintiffs alleged that Newark did not use the taxes collected according to the restrictions outlined in the 1999 Act. Therefore, plaintiffs sought: (1) an accounting of the funds collected by Newark; (2) payment of the parking and payroll taxes collected into an escrow fund administered by the court; and (3) attorneys fees and costs.
The Law Division judge initially granted Plaintiffs' motion for "partial summary judgment on liability" and denied defendants' "cross-motions . . . to dismiss the complaint for failure to state a claim." This ruling was memorialized in two oral opinions and an October 15, 2004 order. The judge found, as a matter of law, that the 1999 Act required Newark to use its parking and payroll tax revenue for the sole purpose of revaluation relief. Thus, Newark was ordered "to place in escrow parking and payroll tax receipts subsequent to October 15, 2004[.]"
Newark moved unsuccessfully for a stay in the trial court. The DCA and Newark moved for leave to appeal. We denied these motions.*fn2
Thereafter, an unanticipated development occurred which impacted this lawsuit: on December 22, 2004, the Legislature repealed the 1999 Act in its entirety, retroactive to September 1999. L. 2004, c. 181, § 3, eff. Sept. 21, 1999. The Legislature also repealed the cross referencing provisions of the Local Tax Authorization Act (Local Tax Act), N.J.S.A. 40:48C-1 to -41. This provision is found at N.J.S.A. 40:48C-8. Curiously, the repeal legislation was introduced by two state senators who happened to be Newark Mayor Sharpe James, a named defendant in this action, and Deputy Mayor Ronald Rice.
DCA and Newark moved in the trial court to dismiss the action based on the repealer. Plaintiffs opposed the motion and responded with a challenge to the constitutionality and retroactive enforceability of the repealer. The judge rejected plaintiffs' challenge, and based on the repealer, dismissed the complaint with prejudice as to all defendants.
Plaintiffs appeal to us, raising several constitutional challenges. We reject them all and affirm the dismissal of the complaint. However, our analysis is not based on the repeal of the 1999 Act. In fact, we conclude that the repealer is irrelevant to this suit against Newark.
Plaintiffs' first contention on appeal is that Newark and the DCA "confiscated property protected by the takings clause." Specifically, plaintiffs argue that Newark stole and spent the revaluation relief payments that, pursuant to the 1999 Act, should have been paid by Newark to eligible taxpayers before the repealer statute was enacted. As support for their argument, Plaintiffs argue: (1) "Newark unlawfully confiscated the taX abatements ...