Businesses that successfully appeal their property tax assessments could be forced to wait years for their full repayments, thanks to legislation that cleared both the Senate and Assembly on Thursday.

NJBIA opposes the bill, A-2004 (Karabinchak, Mazzeo, Pinkin, Coughlin, Diegnan), which would require municipalities to repay nonresidential tax appeal refunds in annual installments over three years instead of 60 days.

“These changes could create a situation where it benefits a town to over-assess a nonresidential property taxpayer, knowing they have additional time to pay back the overpayment,” said NJBIA Vice President of Government Affairs Andrew Musick.  “In short, this bill would make it more difficult to operate a business in the state.”

Under current law, a municipality is required to refund all excess property tax collections for both residential and nonresidential properties within 60 days of a successful property tax appeal, along with 5% interest.  This bill applies the extended repayment period of three years to all appeals over $100,000, for nonresidential property taxpayers only.

“This change would allow municipalities to treat residential and nonresidential tax appeals differently,” Musick said. “Traditionally, commercial and residential property taxpayers have always been treated the same, and we feel the uniformity should remain.

“Furthermore, the additional delay would come on top of a tax appeals process that can be long and tedious in its own right,” Musick added.  “In some cases, the appeals process can take years. Forcing them to wait this much longer to recoup their overpayments is neither fair nor reasonable.”