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One revaluation, two realities
(by Mark J. Bonamo - March 05, 2008)
Tax update reveals city’s two sides
The state-directed revaluation effort is an attempt to update property values with an eye toward correcting long-time imbalances in Hackensack’s property tax system.
However, when Hackensack Chronicle talked to two city homeowners to see how revaluation is affecting them, one pervasive theme of conversation was apparent. It seems that while the revaluation effort is an attempt to make all things relatively equal in terms of property tax, some Hackensack property owners feel more equal than others during uncertain economic times.
New assessments attempt to adjust inequities in Bergen’s capital
The revaluation, conducted in Bergen County’s seat in late 2006, was ordered by the state to try to address property tax inequities that accrued due to the regional real estate boom in the late 1990s and early 2000s.
New Jersey state law dictates that property owners are expected to pay taxes based on the market value of their assets or a steady percentage of current value within a municipality. But market values shift over the years due to vagaries in the economy and in the makeup of different neighborhoods. As a result, assessments may no longer reflect the true value of a particular property, creating a situation in which some areas are undertaxed, while others absorb a harder tax blow. Before the latest revaluation, the last update in Hackensack was completed in 1992.
As in many North Jersey municipalities, results of the revaluation indicate that lower-priced areas in Hackensack have experienced more serious repercussions because their property values rose more precipitously in the recent real estate boom. Meanwhile, properties located in more affluent neighborhoods often experienced tax relief.
Feeling fairly-treated in Fairmount, but fearful of future changes
At the kitchen table of her home at 153 Ross Ave., Stephanie Hellpap, a homemaker and Fairmount School PTA president, looked at her assessment and felt that compared with others in her Fairmount neighborhood, her brush with revaluation was relatively gentle.
“I’ve been reading how lower-end homes have been hit so hard, while a lot of people in neighborhoods like this have had their taxes go down,” said Hellpap, 37, who has lived at her current address with her husband and three children since 2006.
“Mine have gone down.”
The Hellpaps bought their home close to two years ago for $455,000. They paid $8,600 in property taxes in 2006. Their house had its value reassessed as part of revaluation at $379,600. Their 2007 tax assessment was $7,554.04, a decrease of more than 13 percent.
“I think that my house was over-assessed initially,” said Hellpap, offering her explanation of her tax decline. “Right before us, the house was purchased, then flipped. When they sell houses, they re-evaluate. Our home’s value went up because the market went up. Other homes in the neighborhood hadn’t been reassessed because they hadn’t changed owners and they were still paying property taxes based on the old assessments. We paid more for a little while, but now we are back to where we actually should be.”
Hellpap realizes that luck played a role in her property taxes going down. But when she looks at what future revaluations may bring, she also knows that her luck may run out.
“I think that this revaluation was necessary because now at least everybody is paying what maybe they should be paying,” she said.
“The intent was to level the playing field. But now, for many people the tax increases are so high that they feel that they should sell their house. But where are they going to go? Where am I going to go? This house won’t sell for $455,000 this year because of the economy and house prices are going down. I can’t sell this like I could three years ago and make $25,000 and move to Sussex County and get more house and pay less taxes. If I sold my house right now, I’d have to leave the state or I’d have to downgrade. People move to the Poconos in Pennsylvania because they can build log cabins for $200,000 and pay $2,000 a year in property taxes. That’s not going to happen around here.”
On Hobart Street, revaluation provokes little hope
Evelyn Stewart has seen a lot happen in Hackensack during her 55 years living at 52 Hobart St. Her lifelong home, located between Kansas Street and Lexington Avenue, was built according to Stewart in 1867. A retired tractor trailer driver, Stewart has seen the forces of urban decay run rampant in her neighborhood.
“This is like no-man’s land,” she said, looking out the window at her formerly Italian, now predominantly Hispanic neighborhood. “We have no parks here. We have no trees. There’s nothing for the kids to do, and as a result there is a lot of gang activity. Nobody wants to be bothered with the people over here.”
However, the city assessor’s office had to bother with Hobart Street for the purpose of revaluation. Stewart’s house, which she co-owns with her sister, had a value of $115,000 in 2006, with property taxes of $5,762. After revaluation, the property’s value shot up to $336,700, an almost 193 percent increase. But this also meant her property tax share rose to $6,700, a 16.3 percent increase.
For Stewart, the numbers don’t really matter. She knows what she feels after a lifetime in Hackensack.
“Why did property values go up so high to begin with?” she asked.
“It’s just numbers on paper to me. Anybody who’s going to come in to buy this place is going to find fault with this house. It’s old. You can see that it’s crooked. We’ve done some serious work on the place. It would like it to be worth well over $300,000. But we’ll never get that. I’m boxed in by concrete down here. The city has devastated this neighborhood. They took all the trees down. Ride up and down these streets. See if you see one thing that’s beautiful. What about us? When kids walk out the front door around here, what are they walking out to? And they’re the future of not just neighborhood, but this nation. It’s a disgrace.”
“We don’t live on the hill,” Stewart continued. “We’re just poor people that live around here, and they don’t care about poor people.”
Stewart lives with her truck driver husband Larry, 55, and her daughter Jennifer, 15, a sophomore at Paramus Catholic. Her home is embedded with family history. A trunk brought by her immigrant ancestors from Ellis Island lies in the basement. After Jennifer graduates, Stewart thinks that her family might be on the move again.
“We’d like to relocate down south, maybe South Carolina,” she said. “Hackensack is my hometown. This is my neighborhood. But we’re just hoping for a better life.”
E-mail: bonamo@northjersey.com
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