What is the Assessment Demonstration Program (ADP)?

In March 2013, Governor Chris Christie signed into law Chapter 15 P.L 2013 known as the Assessment Demonstration Program to begin in tax year 2014. The Monmouth County Board of Taxation and the Monmouth County Municipal Assessors signed on to be the first in the State to take on this cost-saving project.

Since then, many changes have been put in place; changes will continue during the five year rollout of the program that concludes in 2018.

The following Municipalities have Opted Out of the Program and are not part of the program: Allentown, Avon By The Sea, Belmar, Freehold Boro, Highlands Boro, Manasquan Boro, Marlboro Township, Millstone Township, and Wall Township. These Municipalities are in New Jersey's Traditional (Revaluation) Assessment Model. 

There are three (3) primary components to the Assessment Demonstration Program (ADP) model namely; Assessment Calendar, Technology/Education, and Annual Reassessments/Assessment Maintenance. The pages that follow represent a summary review, as of this date, of these three general areas as they relate to their individual component goals and their role in the ultimate singular goal which is to fix the problems endemic to New Jersey’s property tax system that prevent the fair distribution of the annual tax levy. 

Annual Reassessment and the Impact on Property Taxes

• Annual Reassessments: Ensure that everyone is paying their fair share of taxes (meaning not less and not more than they should) by annually revising every assessment up or down to 100% of current market value. 
• 5-Year Internal Data Collection Program: Increase the frequency of property data collection/verification so taxpayers aren't unfairly left paying less or more than they should be for a decade or more. 
• Remove Fractional Assessments: Improve the transparency of the tax process for taxpayers by doing away with the confusing fractional assessments of the old tax model. 
• Assessment Accuracy: Reduce the need for costly appeals that cost the appealing property owner and the municipality time and money by getting the assessment right the first time. 
• Assessment Calendar Changes: Reduce the negative budgetary effects to municipalities by moving up the appeals deadline so appeals are completed and known before budgets are finalized.

Source: The Monmouth County Tax Board Website.

Benefits of ADP vs. Traditional Assessment Model

Taxpayers:

• -       Fairer Assessments - Fairer Tax Distribution (Prevents people from over paying or underpaying for longer then one year. In the old system it could be as long as 10 years if the person didn’t make and win an appeal).
• -       Transparency: The old system had Chapter 123 and Ratios that determined the amount of taxes to be paid.  The value on the card mailed out was only accurate the year of a reval and that same number was sent out until the next reval: Taxpayers never knew how much they were actually assessed at unless they knew to apply a ratio that changed and was different in every municipality every year.
• -       The ability to file and win an appeal. The old system had Chapter 123 which means the Appellant needs to prove his value is less then 15% of the assessment to win.
• -       The new Volatility Provision added this year prevents large swings and assessments can only go up or down based on the neighborhood. This replaced the FREEZE Act in the ADP.
• -       There is no annual ratio.
• -       No spikes in assessments like revaluations every 10 years.

Municipalities

• -       Cost Savings on inspections and the cost to defend assessments.
• -       No longer multiple year tax court cases costing money to defend and if the taxpayer wins it usually means large paybacks.
• -       The program gives more autonomy to the Tax Assessors to do their job more effectively and accurately using the new tools and technology the program has.
• -       The Assessor can legally make adjustments every year without a Tax Appeal. In the old system unless it was an administrative (ie Wrong lot size) it could not be changed without an appeal. Costing the municipality and taxpayer money to defend.
• -       Flexibility to make adjustments quickly if there is a disaster like Sandy. Again keeping it fair for everyone in the neighborhood affected.
• -       The appeals are over before the budget process. 

County

• -       Equalization is fairer with municipalities at 100%
• -       Potential revenue increases annually when values go up each year
• -       Ability to sell as a shared service as a revenue stream to the county without any cost.