Council considers tax abatement
No taxes for five years on up to $25,000 in added assessment
WEST MILFORD — Taxpayers may have a tax incentive to improve their properties if the township council initiates a tax abatement program for residential properties.
Township attorney Fred Semrau told the council about the program at a recent meeting which would allow homeowners to make improvements to their homes with up to the first $25,000 exempt from their assessment for five years. This, he said, could encourage homeowners to make improvements and be somewhat of an economic development plan.
There are criteria in place that the township would have to meet in order to qualify for this tax abatement program, Semrau said. Namely, 50 percent of the housing stock in the township must be older than 50 years. He said preliminary data from the company that did the revaluation a couple of years ago shows that the township does meet the criteria. A study will be done, either by the assessor or the township planner, Semrau said. Meeting the criteria would give the township the designation in need of rehabilitation, which is necessary for the abatement plan.
What does that mean to taxpayers? If someone wants to add a deck or build an addition, up to $25,000 of that would have been added to the assessment of the home; instead, it will be abated for five years. That could be a savings of up to $1,300 in taxes each of those five years, Semrau said. And the idea is to spur growth.
West Milford is in the Highlands region and new construction is a rarity. However, improving the structures already built is allowed. Giving this tax abatement, Semrau hopes, will encourage improvement of properties. It may be the push someone needs to go ahead with a project they've been thinking about.
“There are so few avenues that a governing body can provide abatements,” said Semrau.
The council directed Semrau to look further into the program. He said he will gather information about the study, which will collect data on the age of township properties. He will put together an ordinance for the council to move forward. Semrau said he is hoping to give a full presentation about the tax abatement program in the fall. It could be in place by the end of the year.
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