By JOHN T. WARD
The Red Bank council postponed action Wednesday night on a proposed tax appeal settlement that would slash the assessment on a downtown bank property by almost one-third.
But the delay, requested by Mayor Pasquale Menna, was not motivated by an objection to the terms of the deal, he said.
The council had been expected to vote on a resolution that would settle a tax appeal for 170 Broad Street, where a Bank of America branch is both the tenant and taxpayer, according to the document.
As reported Wednesday by redbankgreen, the settlement would reduce the assessment on the property by 10.4 percent for 2018; 20.6 percent for 2019; and 32.4 percent percent for 2020.
That would cut this year’s assessment to $3.73 million, from $5.52 million.
Property owner Park Street Real Estate Co. LLC paid $5.2 million for the site in 2012, according to Monmouth County records. Last year, the property bill for the joint address was $126,700.
Under the settlement, Park Street would withdraw an appeal for 2017, according to the resolution, which made no mention of prior years.
Prior to the council meeting, but after the publication of that article, Shehady sent redbankgreen this statement in response to questions sent to him over the weekend asking about the rationale for the large cut in assessment:
While the Resolution only references these recent years, it is important to note that this tax appeal case goes back many more years – as far back as 2012. Commercial tax appeals that take many years to resolve are often very complicated and the settlements shouldn’t be judged solely based on the years in terms of what is settled but rather the totality of the years – in other words, attorneys and appraisers/assessors for both sides tend to want to settle the financial matters of all the years in dispute in just the most recent years for ease and other reasons that come up during negotiations. In this case, it’s also important to note that the three years are being reduced but that the taxpayer withdrew numerous years prior to that. Without going into the details of the negotiations so as not to compromise the settlement, central to the dispute was the 2011 sale of the property, and separately whether the market value of the office space and basement space has been affected over the years since the original assessment. As can be inferred from the resolution and the settlement, the Borough agrees that the original assessment could not be sustained and structured the settlement so that no refunds would be necessary, rather the corrections would be provided through future tax credits. It’s a weird mixed property that’s hard to value, and the settlement represents a compromise with the taxpayer like any tax appeal.
At the meeting, Mayor Pasquale Menna asked that the resolution be tabled for discussion in closed-door executive session afterward.
On Thursday, Menna told redbankgreen via text that he didn’t think the resolution reflected “the totality of the litigation that was before the Tax Court that led to the request for settlement” recommended by Tom Hall, the town’s tax counsel on the case and former borough attorney.
The pact is expected to be on the agenda for the council’s next semimonthly meeting, scheduled for June 17.