This week, the Hillsborough Township Committee awarded Appraisal Systems, Inc. a contract to perform the first town-wide property revaluation in more than a quarter century. A revaluation is a comprehensive assessment of every township property performed in one finite period, producing a "snapshot" of the value of each property. Previous methods of assessing property values used by the township, most notably the "rolling reassessment" program used through 2003, did not look at all properties - focusing on properties that had undergone improvements or areas of town that had significant resales.
A problem with rolling reassessments is that it is possible for inequities to build between frequently and infrequently assessed properties and neighborhoods. Although this happens rarely - and this program is used succesfully in most other towns - it did happen in Hillsborough. This led to Hillsborough stopping rolling reassessments in 2003.
The benefit of a revaluation is that it provides for a fair assessment of every property relative to every other property. In other words, when the project is completed in 2010, everyone will be paying their fair share of property tax!
The downside to the revaluation is that it is expensive. The rolling reassessments were conducted by township employees as part of their regular responsibilities. The marginal costs were minimal. The town-wide revaluation will be done by an outside company - and comes with an $800,000 price tag.
Still, that is $400,000 lower than the anticipated cost - and a whopping $1.2 million lower than the number being bandied about in some of the blogs. Also, Hillsborough can pay off this obligation interest-free over a five year period. And better still, this type of revaluation will be so all-encompassing that it probably won't need to be done for at least another ten years.
At the most, the revaluation will be costing Hillsborough $80,000 a year averaged over that ten year period. Not chicken feed, for sure, but well worth it to level the taxpayers playing field for the next decade - or longer.