The 2013 property tax revaluation in Newark may have opened the floodgates for appeals by commercial property owners, but city officials are taking new steps to resolve many of those cases and issue refunds to those who have reached settlements.
That’s according to attorneys who represent many of the city’s commercial properties. They say the administration’s steps include reaching out to those representatives involved in the cases and issuing a bond to help cover dozens of refund checks in recent months.
Those are good signs, according to Frank Ferruggia, a partner with Newark-based McCarter & English.
“We have received a considerable number of checks already for a significant number of our clients,” said Ferruggia, who represents many of the city’s downtown property owners. “Not all of them, but … (it is) very labor-intensive to generate all those checks, and they’re doing a good job.”
The new efforts come under Mayor Ras Baraka, who came into office last summer, after a 2013 revaluation that rippled through the city’s commercial property base. Experts have said the tax burden on commercial property owners rose to 60 percent from 40 percent as a result of that process, shifting it away from single-family homes and small apartment buildings.
That set off a wave of appeals last year among owners who feel their properties — ranging from downtown office towers to warehouses in the Ironbound — were being overvalued in a market that has yet to fully recover. Many of the cases have spilled over to this year, with the April 1 deadline for filing appeals now looming.
For properties such as the Gateway office buildings, Ferruggia said the revaluation left them with assessed values of between $150 and $200 per square foot. Settlements with the city have brought that down to the $100 to $130 range, he said.
Still, Ferruggia said, his firm has seen no slowdown in the number of cases this year, noting that the effects of the revaluation are still being felt among his clients. But he said he was encouraged by the recent steps by the city and hopes it’s a sign of things to come.
“Some significant number of those, I think, were settled and resolved as a part of that first bond issue,” Ferruggia said. “But there’s still a significant number out there that need to be resolved, and we’re all hoping that the good signs from the first bond issue continue with the issuance of a second one.”