JERSEY CITY -- A five-letter word is causing heartburn in every neighborhood in Jersey City.
Reval.
The citywide property revaluation, Jersey City's first since 1988, is finally underway, with inspectors knocking on doors, homeowners nervous about what their tax bills will be next year and Mayor Steve Fulop urging calm.
Fulop faced a roomful of grim-faced Downtown residents on March 28 to tell them what to expect.
"I know there's a lot of fear because people assume the worst," he told them before adding, "It's going to be disruptive. I don't want to mince words."
Downtown property owners are expected to take a big hit since home values there have soared since the city last conducted a reval. But residents everywhere, from Merritt Street down in Greenville to Secaucus Road up in the Heights, say they fear higher property taxes, overassessed homes and a Jersey City that will be unaffordable for many longtime residents.
"This is going to kill me," said Rosalie Narciso, a 71-year-old retired woman who lives in a Third Street brownstone. "It's going to absolutely kill me."
HOW THE REVAL WILL WORK
Inspectors with Appraisal Systems, the company hired to oversee the reval, began looking at homes in recent weeks. Once they examine every property the company will estimate new assessments for all of them based on recent comparable sales.
You are not required to let inspectors into your homes, but experts recommend it so the new assessment is accurate. Mark Duda, of Appraisal Systems, told The Jersey Journal when it performed Hoboken's reval in 2013 about 80 percent of all interiors were inspected.
The new assessments will reflect your home's market value as of Oct. 1, 2017.
The company says everyone should get their new assessments around Thanksgiving. Residents can appeal them.
The city will strike a new tax rate for 2018. Tax bills in the third quarter of 2018 should reflect taxes based on new assessments.
When the reval is complete, city officials expect the city's taxable property base to rise in value to about $26 billion from its current $6.2 billion.
Jersey City residents at a reval-related protest in the late 1980s outside the Hudson County courthouse on Newark Avenue.
LAST REVAL
The 1988 reval, which came 17 years after the previous one, produced dramatic shifts in property values -- the tax base soared from $800 million to $5.6 billion -- followed by steep tax increases Downtown and in the Heights. A citizen group alleged wide disparities in assessments.
The revolt was bad news for then-Mayor Anthony Cucci. He was trounced when he sought re-election in 1989, receiving fewer than half the number of votes of the eventual winner, Gerry McCann. Cucci came in fourth place.
"The reval killed him," City Clerk Robert Byrne said.
Fulop critics have said his fear of a repeat voter revolt led him to postpone this reval, with new assessments now not scheduled to be public until after the Nov. 7 mayoral race. Fulop has denied this, saying he stopped the reval in 2011 to make sure it is done fairly (last year New Jersey ordered this one to proceed and wrap up by Nov. 1).
"The last time the city did a reval, when I was 11 years old ... many people throughout Jersey City lost their homes," he said during an April 2015 meeting with local activist group Jersey City Together. "If it's not done fairly the same thing from 1988 will happen."
TALE OF TWO CITIES
Since the last reval was nearly 30 years ago, the average property in Jersey City is assessed at just 23.66 percent of its market value.
The state says revals should be conducted when that figure dips below 80 percent, arguing that local taxes are not distributed fairly if the assessed-to-market-value ratio is so low (taxes are tied to assessment). One resident's home could be assessed at its 1988 value, their neighbor's home at its 2017 value.
Critics of the mayor point to his house as an example of unfair taxation.
In 2015 Fulop and his wife bought a four-bedroom house on Ogden Avenue, a leafy street in the Heights overlooking the Manhattan skyline. The sale price was $845,000. Its assessed value is $104,000, just 12 percent of its market value. The Fulops' annual tax bill is $8,009.
About three miles south on Grand Street near Summit Avenue, Jonathan Johnson lives with his daughter in a two-bedroom condo that he purchased in 2012 for less than half the price of Fulop's home. Johnson's tax bill is $400 larger than the Fulops'.
A graphic designer, Johnson, 46, said he is concerned that nearby condos selling for hundreds of thousands of dollars over their asking price will lead to unequal assessments and continued disproportionate tax burdens. A higher tax bill wouldn't make him move, but he knows others who feel differently, he said.
"A lot of my neighbors are afraid," he said.
FLASHBACK: Fulop, Jersey City pastor spar over revaluation
TAXES
Real estate attorney David Wolfe tells homeowners not to panic about taxes when they receive their new assessments.
That's because 2018 taxes will be calculated using a new tax rate, not the current one of 7.7 percent. Hoboken's tax rate dropped from 4.8 percent to 1.4 percent after its 2013 reval, Wolfe noted.
"The fact that your assessment doubles or triples doesn't mean your taxes are going to go up," Wolfe told The Jersey Journal.
Fulop told residents at the March 28 meeting that if your home is assessed below the 23.66 percent figure (the assessed-to-market ratio of the average property) you will probably see a tax hike, if you are above it you will probably see a decrease and if you are at about that level, you may not see a change.
That doesn't reassure Narciso, the Third Street woman who still remembers the 1988 reval. Her assessment rose from $12,600 to $220,000, though she appealed and had it lowered by about a third.
Narciso has lived in the Downtown home since 1952 and fears escalating real-estate values in her neighborhood will be the final thing that pushes her out of the city. A three-story, three-unit brownstone like hers one block south on Third Street was reassessed in 2016 after renovations and saw its assessment and tax bill nearly double.
"It's going to crush, literally crush, the few of us still here," Narciso said.
Terrence T. McDonald may be reached at tmcdonald@jjournal.com. Follow him on Twitter @terrencemcd. Find The Jersey Journal on Facebook.