Special Note: Joe Ciaglia of Ciaglia Landscape Design, LLC. has requested I post the following:
Please make the appropriate corrections to your verbiage. I am the owner of Ciaglia Landscape Design LLC. I have nothing to do at all with any variances, subdivisions and or tax breaks. I work 70 hours a week so that I can do for my children what my father (Anthony Ciaglia the Mason) has done for us. I am not a board member and quite frankly have never attended a board meeting in my life. I am not saying that I do not care about the town, but I spend most of my time trying to grow my business so I can afford to stay here in Aberdeen. Please know that I am not a builder nor am I affiliated with any type of new construction of homes in this town. Should you have any questions regarding my personal or business life, please contact me at anytime. I would be more than happy to interview.
Aberdeen’s been good to the Ciaglia family. There’s Joe Ciaglia of VRI Realtors, Joe Ciaglia of Ciaglia Landscapers, and Joe Ciaglia of Ciaglia Builders. All of them have built successful careers through hard work and their fair share of good fortune. But John Ciaglia of Ciaglia Builders has been the luckiest one of all. He has an unbroken streak of winning variances, building on subdivided lots, and garnering tax breaks in Aberdeen Township. Sadly, it seems John’s luck is about to run out.
Again and again, John Ciaglia has won the right to subdivide land and build on lots that are too small to accommodate his houses. In 2000, he won the right to subdivide two lots on Church St. into 5 properties, even though each lot would only be 75 feet wide instead of the 100 foot zoning minimum. That same year, the zoning board allowed him to construct five homes on a tract formerly owned by the Cross of Glory Lutheran Church. In 2003, he was allowed to subdivide a property on Atlantic Avenue and build a second house on a 6,250 square foot lot. Then there’s the 7,500 square foot lot on Dolan Avenue. He’s now looking for a variance to convert the corner mother/daughter house on Church St. and Atlantic Ave. into a legal two residence.
To assist with any zoning requests, the town council obligingly appointed Joe Ciaglia (I believe of landscaping) to sit on the Zoning Board.
At each turn, the public has opposed Ciaglia’s expansion plans on grounds that over-developing the land would detract from the neighborhood and the added tax revenue would be lost to the costs of schooling for incoming families. After all, why have zoning regulations if they constantly get waived for developers.
The most egregious zoning exemptions were granted for 75 Cambridge Dr., a house that is only a few feet from the street on three sides and nearly bumps into the retaining wall on the backside. (There is a jutting strip of land that constitutes much of the 8,390 sq. ft. of land.)
By granting the zoning requests, Aberdeen Township enabled John Ciaglia to buy land on the cheap, subdivide the properties, and build as much as he could. But then the township went one step further. In a town that has the third highest tax rate in Monmouth County, where the locals howl against over-development, where our school district is being overwhelmed by nearly 4,000 students, Aberdeen Township declared all of Ciaglia’s development properties as “vacant land” rendering them almost tax-free.
Before continuing, I need to explain a couple of items regarding property taxes. Real estate consists of the land itself, including everything above and below it, and any “improvements” on the land (i.e. houses, buildings, swimming pools, etc.). To determine market value, an appraiser first determines “best use” of the property and then evaluates the property through one of three methods – comparables, income, and cost to build.
The township then assesses the property based upon presumed market value. To keep the bookkeeping simple, rather than change a property’s assessed value with each fluctuation in the marketplace, the township maintains a constant assessment but uses an “equalization factor” to determine the ratio between the assessed value and market value. Market value times equalization factor equals assessment. For example, in 2008, Aberdeen Township’s equalization factor is 37.94 percent. A house with a market value of $400,000 would be assessed $151,760.
When assessing a developer’s property, we need to first assess the best use of the property and then the improvements. So, let’s say a developer purchases farmland and then applies for the land to be rezoned for residential. The land would be initially assessed as farmland but then assessed as residential property after the zoning change.
Regarding improvements, the legal standard is that every developer is assessed full market value once the improvement is “substantially complete”. What’s the definition of “substantially complete”? If a person could live or work in the structure, it’s substantially complete. No need to wait for final touches.
Now, let’s look at Ciaglia’s properties. As mentioned, the township allowed him to subdivide two lots on Church St. into five. Have a look at the tax table for the Ciaglia properties on Block 55, Lots 9.04, 9.05, 9.06, 9.07, and 9.08. Notice how they’re all assessed as vacant land in 2002. Flip through the pages and you’ll see that whichever properties are owned by Ciaglia remain assessed as vacant land. There is one exception – block 55, lot 9.07 in 2004. That’s because the property was sold in 2003 but not recorded until 2004.
Of course, that’s not proof that anything is amiss. It’s possible that Ciaglia sold the homes as soon as he finished them. (The township doesn’t track when properties become “substantially complete”.)
Nor is it proof that it happened again on Oakshades Avenue on block 275, lots 10.01 and 10.02. Or that it also happened on Shadynook Street, block 315, lot 3.
But Cambridge Park, that’s proof.
Ciaglia purchased land from the Cross of Glory Lutheran Church in 2002 for $250,000. Although he initially intended to build six homes, part of the property was declared a wetland, reducing the project to five houses. Have a look at the tax tables for block 68, lots 16.02, 16.03, 16.04, 16.05, and 16.06. The properties are only assessed at $1660 each. Using the 2003 equalization factor of 67.67%, the township valued all five properties together for $12,265, less than 5% of the purchase price.
Basically, the township assessed the properties as if they were still zoned for a place of worship. Even when all the zoning variances had been approved, the Ciaglia lots were assessed for a pittance of the purchase price. Even when all the permits were issued. Even when construction began. And even when construction was “substantially complete”.
In 2006, I received the following MLS listing - 10105935, 75 CAMBRIDGE DR, ABERDEEN, NJ - $649,900.00. The listing has since expired but it described 75 Cambridge Dr. as being built in 2005. Then take a look at the tax record. In 2006, it was still being assessed $1660 (a market value of $3670). In 2007, it was assessed as residential property with zero improvements. Only in 2008, has it finally been assessed full value.
In 2006, Ciaglia paid $440.95 in taxes for properties worth over $3,000,000.
The game plan was a simple one. Ciaglia’s properties were only re-assessed at the issuance of a certificate of occupancy. But builders don’t apply for the certificate until they’re about to sell the properties. Why Aberdeen Township chose to play this game, I don’t know.
But then John Ciaglia’s luck ran out. Of the five properties, he’s only been able to sell one; the lots are too small to warrant such high prices in this neighborhood. Then came the housing slump and the credit crunch. Then came Holly Reycraft, Aberdeen’s new tax assessor.
Unfortunately for Ciaglia, Reycraft neither knew of, nor was interested in, any “understanding” Ciaglia had with the township. Her only concern was doing her job as defined by law. The New Jersey State Constitution demands that “All real property . . . shall be assessed according to the same standard of value.” (Article VIII, Section 1(a)) There are no exceptions for developers, even in Aberdeen Township.
So, one day, Reycraft just happened to be driving down Cambridge Drive when she noticed all the new houses. Back at the township, she discovered an “oversight” in the tax rolls and immediately adjusted the property assessments for Cambridge Park to reflect full market value.
Well, John Ciaglia was not pleased at all. He challenged the assessments at the county level and was rebuffed. Now, he’s waiting to make his case before the Tax Court of New Jersey, docket number 000134-2008. Unfortunately for him, the case isn’t scheduled until September.
Including his two houses on the corner of Atlantic Ave. and Church St., John Ciaglia is sitting on about $2 million in debt and spending over $250,000 a year in interest payments, property taxes, and upkeep, while watching his properties lose value.
Then again, this is Aberdeen. Let’s see if John Ciaglia’s luck turns around. As for Holly Reycraft, pray she doesn’t meet the same fate as former town manager, Stuart Brown. >>> Read more!