This bill amends current New Jersey law to end the tax-exempt status of property owned by the State, its agencies, and authorities, making such properties subject to local property taxation starting July 1, 2026. The bill specifies that the tax-exempt status will cease unless a certification is filed with the municipal tax assessor indicating that removing the tax-exempt status would impair the rights of bondholders under existing covenants. Additionally, the bill allows for the enforcement of tax liens against State-owned properties in the same manner as other tax liens and prohibits the State from offsetting property taxes due with reductions in municipal formula aid, except for payments in lieu of taxes.

The bill also modifies the existing law regarding the tax status of real property acquired by the State or its agencies, stating that such properties will continue to be taxable rather than becoming tax-exempt as previously stipulated. This legislative change aims to ensure that the State and its entities contribute fairly to the local tax burden, alleviating the financial pressure on local residents and businesses who currently subsidize State operations.

Statutes affected:
Introduced: 54:4-3.3