New Jersey Assembly Bill ACR189

New Jersey 2022-2023 Regular Session

• Introduced: 12/4/23
• Refer: 12/4/23

Caption

Proposes constitutional amendment to allow lower property tax rate on improvements than on land.

Impact

The implications of ACR189 are notable in that it aims to facilitate infrastructure investment in municipalities facing economic challenges. By making it financially easier to improve properties without a corresponding increase in tax burden, the bill seeks to encourage redevelopment efforts. Municipalities that choose to adopt such ordinances would have flexibility in determining the difference between the rates for land and improvements, and they may phase in these changes over several years. Additionally, it establishes mechanisms for municipalities to revert to a single-rate system if desired.

Summary

ACR189 proposes a constitutional amendment to allow municipalities in New Jersey to enforce a property tax system where taxable improvements, such as buildings and other man-made enhancements, can be taxed at lower rates than the land itself. The bill seeks to amend Article VIII, Section I of the New Jersey Constitution, permitting the Legislature to enact general laws that would enable municipalities to adopt ordinances to apply varying tax rates. This would represent a significant shift from the current mandate, requiring a single value-based property tax rate for both land and improvements.

Contention

There are potential points of contention surrounding ACR189, particularly regarding which municipalities will be eligible to adopt these dual tax rates. The proposed legislation allows the Legislature to set standards for eligibility, which could lead to debates over fairness and equity among different communities. Critics may argue that it could disproportionately benefit certain areas over others and raise concerns about the long-term sustainability of funding for local services reliant on property tax revenues. Ultimately, the amendment will be subject to a public vote following its agreement, positioning constituents to weigh in on the proposal.