Tax assessor set aside $4.3 billion in property value lost in Sandy
When most New Jersey residents’ tax bills go out this month, assessments on more than 40,000 properties will have been reduced by a total of $4.3 billion due to Hurricane Sandy damage, according to previously unreleased figures by the state Department of the Treasury.
Those reductions were made in the months after the storm, when the Division of Taxation created a system for tax assessors in the hardest-hit communities to use that would help track losses to ratable bases. Through the spring, the state compiled that data into one document to help analyze which local governments would see their budget revenue be most affected by the storm. The Press of Atlantic City acquired that information through an Open Public Records Act request.
What the figures represent are reductions on properties that could not be immediately repaired and will therefore be valued less for 2013 tax purposes. In many cases, homeowners were waiting for more information or insurance money before repairing when inspectors conducted analyses in December and January.
Gov. Chris Christie’s office originally estimated what those losses might be when it said in November that Sandy would cost the state $36.9 billion, but this data provides a more precise picture of losses to tax bases.
Ocean County lost $3.6 billion from its total ratable base due solely to storm damage, a 3.8 percent drop from 2012. Monmouth County saw the second largest drop, with about $511 million in reduced assessments, followed by Atlantic County at about $72 million and Cape May County at $26 million.
Outside of Ocean and Monmouth counties, no municipality lost more than 1 percent of its tax base due to Sandy, except for one: rural Downe Township in Cumberland County, which sits on the Delaware Bay and lost about $3.6 million in assessments, or almost 2 percent of its total property assessment.
Downe has been considered as an area where the state could buy flood-prone properties, but Mayor Robert Campbell has fought the idea that his small community needs to be bought off while oceanfront towns are protected.
“I don’t see any reason why these communities should disappear rather than Ocean City or Margate or any of the rest of them,” he said.
Ocean City accounted for almost the entire assessment reduction in Cape May County, but there was an apparent discrepancy in how much. The state’s data said more than $55 million, but that figure is very different from the $22.6 million in Sandy-related reductions Ocean City Tax Assessor Joe Elliot said he had in his records.
The discrepancy could be due to the city’s ongoing reassessment, said Lisa Ryan, director of communications for the state Department of Community Affairs, which has been using the data to assist municipalities with their budget issues.
Brigantine, where Sandy made landfall, saw the largest impact to its tax base in Atlantic County, with more than 354 properties losing a total of almost $21 million, which amounted to half of 1 percent of the city’s total assessment.
“This was just for people that could not fix their homes immediately,” said Brigantine Tax Assessor Barbara Saccoccia, adding that far more properties were damaged than the 354 properties that received assessment reductions there.
Overall, the data make clear that Ocean and Monmouth counties were the hardest hit, by far.
Mantoloking, where almost every property was damaged and scores of homes are still being demolished, lost one-third of its total ratable base. That is a reduction of $530 million from its total assessment of $1.6 billion in 2012.
In most shore communities, the land is worth the majority of the property’s entire value, with the improvements accounting for one-third or one-quarter of the total. While most towns saw damage to homes, Sandy destroyed the land in Mantoloking by carving an inlet through the borough, which is why the losses were so dramatic.
Toms River Township lost more than $2 billion in value, about 13 percent of its total and nearly half of the total assessment loss for the entire state.
In Monmouth County, Manasquan saw the largest reduction by dollar amount at $82 million, while Sea Bright lost the most value by percentage at 13 percent of its ratable base.
The storm affected assessments in all but three of the state’s 21 counties.
Funding from the Federal Emergency Management Agency has softened the tax implications of these losses. Many municipalities have used Community Disaster Loans to support tax revenue that slumped from the damage and cover costs for repairs. Ryan said the state is using the information also to make Essential Services Grants available to bridge any funding gaps.
In many cases, the reductions will be only temporary.
“If they got a reduction, and if they made repairs, they could end up going back to full value at the start of the year,” said George R. Brown, Cape May County’s tax administrator.
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