A New Jersey Tax Court judge has ruled that a municipal tax assessor should not have served as an expert in a case challenging the property value set by another municipal tax assessor, effectively stopping municipal experts from accepting certain side jobs as appraisal experts.
The Tax Dispute
A Hazlet, New Jersey property owner, VNA 1105 State Hwy 36, LLC, appealed its tax assessments for the period of 2013 to 2017. Hazlet had valued the property at issue at $4.2 million to $4.7 million over that five-year period.
The Expert Dispute
VNA hired Ted Lamicella, who is also the tax assessor in Wall Township, New Jersey, to appraise its property in suport of its argument that its property value should be lowered. Hazlet’s attorney, James Gorman, challenged Lamicella’s appointment, citing the New Jersey rule that prohibits municipal assessors from appearing as an expert witness against another assessor.
“No assessor shall appear before the board as an expert witness against another assessor or taxing district within the State except to defend the assessment of his taxing district.” N.J.A.C. 18-12A-1.9(l).
However, VNO’s attorney, David Wolfe, argued that this rule only applied to appeals before county tax boards, not in tax court. He also argued that this prohibition would unfairly prejudice property owners because it would significantly limit the pool of experts that are available to them in their appeals.
The Tax Court Ruling
New Jersey Tax Court Judge Mala Sundar decided that the prohibition against municipal assessors working as appraisal experts also applied to state tax court. Judge Sundar reasoned that tax assessors are supposed to act as impartial judges of property values so that taxpayers trust that the system is fair. Judge Sundar explained that when municipal tax assessors work for someone besides the government, it could undermine the public trust in the system or give the impression that assessors give preferential treatment to the attorneys who hire them as experts in tax appeals.
Judge Sundar wrote, “It is reasonably foreseeable that the public would consider such an appearance as evidence of a lack of confidence in an assessment by an assessor, or an elevation of personal financial interest, which would impugn the integrity of any assessment and the significance of any assessor’s role as a quasi-legislative agent of the State.”
It could also be argued that limiting appraisers to giving pro-government testimony undermines faith in their integrity. In any event, VNO will be allowed to find a new appraiser who is not a municipal tax assessor to represent it in its appeal.
This is the second time that Lamicella’s outside work as an expert witness in tax appeal cases has been called into question. In 2017, the Monmouth County Tax Board of Commissioners questioned whether Lamicella had violated state rules for his role as an expert in a tax appeal that was filed in Ocean Township.
Tax assessors do not need approval before taking outside employment; however, they are required to disclose outside employment on financial disclosure forms.
Wall Township administrator Jeff Bertrand has stated that he’s discussed the issue with Lamicella and he will no longer be working as an expert.