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Nonprofit Housing Groups Exempt from Property Taxes, Rules New Jersey Supreme Court



Nonprofits that provide housing and other services to people with mental illness and other disabilities do not have to pay property taxes, the state Supreme Court ruled today, ending a battle with nine Bergen County communities that had challenged the tax-exempt status of one charitable agency nearly a decade ago.

 
The state's highest court deemed the 14 properties run by the nonprofit, Advance Housing, Inc. are exempt from property taxes because the homes and the supportive services that come with them, such as counseling and job placement, help people with mental disabilities "who otherwise would be dependent on government relief," according to the unanimous opinion written by Justice Barry Albin.
 
"The property — purchased on large measure at public expense — serves a vital need that would otherwise by borne by the state at a much greater cost, " according to Albin's opinion.
 
The decision upholds an appellate ruling, and overturns decisions made by the state Tax Court and the Bergen County Board of Taxation in a case brought by Teaneck, Bergenfield, Little Ferry, Ramsey, Ridgefield Park, Lodi, Fairview, Leonia and Hackensack in 2004.
 
The municipalities argued, and the tax court agreed, the people who lived at Advance's properties were not required to participate in the support services. "Advance Housing was running essentially a subsidized housing program for clients who happen to be eligible for its supportive and counseling services," according to Albin's summation of the Tax Court's ruling.
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