From the Record:
In 2007, the Shanahan brothers who own Washington Garage, a small auto repair shop on Main Street in Bergenfield, paid $22,107 in property taxes.
After the town conducted a revaluation two years later to bring its property assessments in line with market values, Washington Garage’s yearly property tax bill shot up 70 percent to $37,520. The revaluation shifted tax burdens from residents to commercial property owners.
Higher property taxes have squeezed the business, whose annual revenue has fallen from $1.4 million in recent years to about $900,000 annually and its profit margin has fallen below 1 percent, according to Brian Shanahan, who along with his brother Tim run the repair shop their grandfather founded 80 years ago.
“They’re bleeding us to death,” Shanahan said. “It’s just too much of a burden.”
As commercial real estate owners deal with the recession’s lingering effects, record numbers of them this year are expected to appeal the assessed values of their properties, which determine how much property taxes they pay to municipalities.
The appeals, if successful, could shift tax burdens and add to municipalities’ financial strain in a year in which employee pension costs are rising and as a 2 percent cap on property taxes goes into effect.
Multiple appeals for single properties build up over the years, and eventual settlements can clear multiple cases. For example, Elmwood Park-based paper products maker Marcal Manufacturing LLC recently settled six years’ worth of tax appeals with the town. This month, Elmwood Park sent Marcal two checks worth a total of $649,996, Borough Clerk Keith Kazmark said.
“This is the toughest year yet since the recession began,” said Julie Beglin, a vice president on the public finance team at the bond rating agency Moody’s Investors Service.