Comptroller’s Office finds vacant properties costing city thousands
By P.T.
Published: July 30, 2013
Seven properties in Paterson, which were listed as tax exempt by the city’s tax office, were found to be ineligible, costing the city’s taxpayers more than $40,000 per year, according to a report released by the New Jersey Comptroller’s Office.
The seven properties reviewed by the office were vacant lots, unused, and not being utilized for the purpose for which the properties were granted tax abatement. Investigators found one property was used as a paid parking lot for which the city was not making a cent, while another property had large a billboard which was providing the advertiser free advertising in the city without the government making a dime.
A foreclosed property, 202 West Broadway that was taken over the city, had on its lot a CBS billboard advertising placed there by the company, after it leased it from a Florida man, prior to the city’s take over.
After the takeover, the billboard remained on the property – it is likely that the city did not visit the property to review its condition. The report states, “Paterson officials were unaware that the billboard was on the property and therefore had not collected any rent or fee from the billboard company.”
Another empty lot located on Graham Avenue was being used as a parking lot by a resident who does not own or has rights to park vehicles in the space. The report states, “Paterson is failing to properly maintain its vacant properties, which can result in a decrease in the value of property in the area.” Had the city been monitoring and keeping a watch on its properties the chances of it being used by someone would have been close to naught.
Out of the seven properties, two were cleaned up by the city, after the report exposing property neglect was sent to city’s division of tax assessment. The vacant parking lot on which a resident, whose information the city located and sent to its legal department for legal action, remains as a parking spot for the individual. The television company billboard from which the Florida man was profiting was contacted by the city to make corrections with whom to pay – the plans to sign a lease agreement to keep the billboard there will make a few bucks for the city’s taxpayers.
Matthew Boxer, the comptroller, says, “Every time a municipality exempts a property from taxation, other property owners fill the resulting revenue gap.” While the vacant lots were being exploited by former owners and individuals seeking a free lot to park their vehicles, the taxpayer picked up much of the forgone tax revenues.
“Based on their 2011 assessed value and the applicable tax rate, these properties had a total net value of $1,603,600 and would have generated $40,330 in tax revenue that year, which instead was apportioned to other taxpayers in the municipality,” reads the report. Some of the properties were vacant for a much longer period; however, if only the past three years are counted the city, just in these seven properties lost $120,000 – not taking into account the recent tax increases that would have yielded more.
Mr Boxer’s office made recommendations to the city to help correct some of the mismanagement by appointing an individual who would serve the role of property manager. A suggestion that was implemented by the city after being shown the results of the investigation. Ruben Gomez, director of redevelopment, is set to fill that role.