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Journal of Property Tax Assessment & Administration

Abstract

New Jersey signed the Real Property Assessment Demonstration Program (ADP) into law effective at the beginning of 2014. The Monmouth County, New Jersey, Board of Taxation and the county’s municipal assessors are the only tax officials in the state to implement the ADP. The program’s intention is to improve real property tax assessment fairness and efficiency. After six years, there is now sufficient data to test whether Monmouth County’s ADP program has reduced tax assessment inequities. We use the International Association of Assessing Officers’ (IAAO) (1990; 2013) standard methods to analyze the effectiveness of Monmouth County’s ADP. In addition, we use the Clapp (1990) and Birch-Sunderman (2014) models to study residential property tax assessments by comparing assessed values to actual sales, controlling for town-level effects, during the two years prior to implementation of the ADP (2012-2013) and the two most recent years (2018-2019). We find empirical evidence that both vertical and horizontal inequity of residential property tax assessments decreased after ADP implementation, but progressive tax assessment inequities still persist within the county.

Keywords

Comparable sales adjustments; Property tax administration; Assessment performance measures

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