September 26 Update: Tax bills have been sent to homeowners
May 9th Update: The proposal has been approved
Understanding property taxes
At their last public meeting, Lakewood’s Township Committee formally introduced the 2019 municipal budget, which includes an increase of 8.15% to the tax rate. This will amount to an annual increase of $268 to a home assessed at $551,700 (an average single family home) and $201 to a home assessed at $417,900 (an average townhome).
The tax rate is the percentage assessed as payable in taxation per $100 of your home’s total assessed land value.
The Township’s tax assessor assigns every parcel of land a certain value. Then the tax collector sets the rate at which every home will be taxed.
In 2018, the tax rate was $0.592 and the proposed 2019 rate is $0.6402, which is how we calculated the 8.15% increase (0.592 x 1.0815=0.6402).
Township Committee was dishonest regarding ‘flat budgets’
Lakewood Township Committeemen have stated in the past – particularly by election season – that they maintained a “flat budget” for at least 3 years. However, while we agree that this is the first increase to the tax rate in a while, we don’t think it’s fully accurate to say the budget remained flat for 3 years – even though it was reported in local media outlets.
This is for 2 reasons:
1) In 2017, the tax assessor did a township-wide reassessment of every parcel of land in town. Due to this, the tax rate actually decreased significantly, from $0.861 to $0.592. However, with the new assessments, many residents paid a higher tax bill, while some residents did pay a lower tax bill.
“if there is so much new construction in town every year, with more people paying property tax, how is it that our property taxes don’t go down?”
2) The question is often asked, “if there is so much new construction in town every year, with more people paying property tax, how is it that our property taxes don’t go down?” Part of the answer is that the Township Committee often grants 5 year tax abatements to new retail shopping centers and office buildings (on the basis that these new centers create new jobs in Lakewood).
It comes out that the total revenue by taxation actually increases annually by well over $1 million (and in 2017, thanks to the Township wide reassessment, close to $2 million).
This is why, though the tax rate did indeed remain stable for 2 years until now, and for at least 3 years prior to the 2017 township-wide reassessment, we don’t think it’s fair to say that the budget remained flat for 3 years.
On April 17, the Township Committee will hold a formal public hearing prior to adopting the new budget.