Every property owner pays property taxes based on the assessed value of their property. Every property owner who believes that their property is worth less than the assessed value is entitled to file a tax appeal, providing evidence that demonstrates that the value should be lower.
Some property owners have filed appeals over the years, especially in years when property values have declined. Some residents and council members have filed -- and won -- multiple tax appeals in the same year for properties they own in Teaneck.
But the Glenpointe Associates tax appeal raised this to an art form. The family of David Sanzari -- which has donated more than $40,000 to Deputy Mayor Elie Katz -- that primarily owns and operates the Glenpointe complex had filed tax appeals starting in 2007 and continuing for every year through 2019.
In July 2014, then-Township Manager William Broughton told the Township Council that the bill could be very significant -- warning that in the worst case scenario it could be as much as $5 million -- and advised the governing body that the failure to set aside money to cover the bill would place the Township at risk when it asked for permission from the relevant state agency to borrow the money to cover the judgment. After all, if the township knew that it expected to owe what could be as much as $5 million and hadn't set aside anything in advance to cover the bill, the failure should rest on the township.
A 2020 decision by New Jersey Tax Court found that the Sanzaris and Glenpointe were correct. The properties they own had been systematically over-assessed. After negotiating the details of how to allocate the reduced assessments to all of the buildings, the township owes more than $8 million for overpaid taxes and interest, which was assessed at 5% per year.
With 11,000 families in the township, your share is $750, depending on the value of your property. If you've moved in recently, you scrimped and saved to put the money aside in order to make a downpayment and buy your house and cover all the bills. Now, while you struggle to pay your expenses, you're being hit with a huge bill for tax appeals filed more than a decade before you moved in, all because this council couldn't be bothered to set aside money to cover the bill it knew was coming.
At its March 16th council meeting, the council approved an ordinance that will borrow $8.25 million, which will cover the Glenpointe appeal and other tax appeals filed against the township. Township Chief Financial Officer Issa Abbasi told the council that the state had approved the borrowing, even though the township had set aside only a small fraction of the money needed to cover the massive expense. Several members of Council, the attorney, the manager and the chief financial officer then quickly lined up to declare this settlement a “home run”. Let’s see what baseball metaphor might best apply.
This $8 million-plus will be borrowed, and with added interest - just at the moment when most economists expect interest rates will soon rise, likely before the Township can get the borrowing into bonds. But what's going to cost you isn't just the interest on the new borrowing. More than $2.2 million of the $8 million due to Glenpointe is for interest, which was charged at 5% per year, as required by law, going back as many as 13 years. No wonder the Sanzaris were happy to see their suit drag on; inflation during the period averaged less than 2%.
Are you new to Teaneck since 2017? Well you're now expected to foot your part of a bill you had nothing to do with and for which you will see no benefit. Even if you've just moved in and never heard of Glenpointe or the Sanzaris or about all the over-the-top campaign contributions they've given to Elie Katz, you will be forced to pay this money back in your taxes. A home run for those folks, or just an error?
For those of us who have been here all the time, would it not have been better to follow the former Manager’s advice and put much of the $8M into escrow a little bit at a time? And going forward – the new hotels at Glenpointe have always been a good development. But if you think the Sanzaris won't be filing a brand new tax appeal to get back a significant portion of the tax bill on their empty hotels beginning last March, then watch out or you're likely to get hit by the next pitch.