Christian Mission John 316 v. Passaic city

TAX COURT OF NEW JERSEY
TAX COURT MANAGEMENT OFFICE P.O. Box 972
(609) 815-2922 TRENTON, NJ 08625-0972
njcourts.gov – select Courts/Tax Court
Corrected Opinion Notice
Date: March 1, 2018
Tova L. Lutz, Esq
Lutz Law Group, LLC
Kenneth A. Porro, Esq.
Chasan Lamparello Mallon & Cappuzzo, P.C.
From: Lynne E. Allsop
Re: CHRISTIAN MISSION JOHN 316 V. PASSAIC CITY
Docket number: 013203-2013
The attached corrected opinion replaces the version released on February 28,
2018 The Opinion has been corrected as noted below:
Defendant firm name corrected
Page 6, citation changed to - (quoting Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 251-52 (1986)).
Page 13, citations changed to - (citing Institute of Holy Angels, 80 N.J.L. 545
(1910); Max & Sarah Bamberger Seashore Home, 91 N.J.L. 330 (1917)).

NOT FOR PUBLICATION WITHOUT THE APPROVAL
OF THE TAX COURT COMMITTEE ON OPINIONS
Corrected 3/1/18 - pg. 1 firm name, pgs. 6 & 13 citations corrected
_________________________________
: TAX COURT OF NEW JERSEY
CHRISTIAN MISSION JOHN 316, : DOCKET NO. 013203-2013
:
Plaintiff, :
:
v. :
:
PASSAIC CITY, :
:
Defendant. :
_________________________________:
Decided: February 28, 2018
Tova L. Lutz, Esq., for plaintiff (Lutz Law Group, LLC, attorneys)
Kenneth A. Porro, Esq., for defendant (Chasan Lamparello Mallon
& Cappuzzo, P.C., attorneys)
NOVIN, J.T.C.
This matter comes before the court by motion for summary judgment from Christian
Mission John 316 (“plaintiff”), and cross-motion for partial summary judgment from Passaic City
(“defendant”).
Plaintiff challenges the denial of its 2013 tax year application for local property tax
exemption under N.J.S.A. 54:4-3.6. Conversely, defendant charges that the denial was appropriate
because the property failed to satisfy the criteria for exemption under N.J.S.A. 54:4-3.6, and seeks
partial dismissal of plaintiff’s complaint.
For the reasons stated more fully below, the court concludes that the subject property was
not entitled to local property tax exemption for the 2013 tax year under N.J.S.A. 54:4-3.6.
Therefore, the court denies plaintiff’s motion for summary judgment and grants defendant’s cross-
motion for partial summary judgment.
Approved for Publication
In the New Jersey
Tax Court Reports

2
I. Findings of Fact and Procedural History
Pursuant to R. 1:7-4, the court makes the following findings of fact and conclusions of law
based on the certifications and exhibits of the parties.
Plaintiff operates a church, with an appurtenant parking lot, located at the northeasterly
corner of Madison and Leonard Streets, in the City of Passaic, County of Passaic, and State of
New Jersey. Plaintiff’s church and parking lot are exempt from local property tax. However, as
plaintiff’s congregation has grown, it sought opportunities to expand its facilities.
In September 2009, plaintiff purchased the adjoining property, known as 250 Madison
Street (“subject property”). The subject property was formerly designated as Block 2168.A, Lot
11 on defendant’s municipal tax map. Prior to the sale, the subject property was improved with a
commercial warehouse, used for the storage and sale of beverages.
Sometime between 2009 and 2012, plaintiff filed an application for local property tax
exemption for the subject property. Defendant denied the application. Plaintiff did not appeal the
denial.1
Plaintiff maintains that from 2009 through 2011, it used the subject property in furtherance
of plaintiff’s work. According to plaintiff, between 2009 and 2011, the subject property was used
as an “extension of its regular religious activities,” including for “ceremonial activities, religious
services during mild weather months, youth rallies, women’s rallies, fundraising activities, fairs
and storage of various items associated with church functions.”2 Photographs of the interior of the
1 The tax year for which plaintiff sought a local property tax exemption for the subject property, and the basis for
defendant’s denial of the application, were not part of the record before the court.
2 Plaintiff did not assert or maintain that the subject property was used for any of these activities during the 2012 tax
year.

3
subject property, submitted in support of plaintiff’s motion, depict a commercial warehouse with
exposed ceiling joists and roof rafters, a roll-up steel door, concrete floors, and a lack of a
functioning heating system (the photographs illustrate individuals inside the subject property
adorning winter coats, scarfs, and hats).
Beginning in late 2011, plaintiff began a series of “significant renovations” and
improvements to the subject property to convert it from a commercial warehouse into a large
sanctuary, offices, and meeting space. Building permits were issued for the interior construction
and renovation, including building, framing, electrical, plumbing, mechanical (installation of
HVAC systems), and installation of fire protection apparatus. Soon thereafter, construction of the
renovations and improvements to the subject property began.
On April 15, 2013, defendant issued plaintiff a temporary certificate of occupancy for the
subject property. Defendant issued plaintiff a final certificate of occupancy for the subject property
on July 23, 2013.
In 2012, plaintiff applied for local property tax exemption for the subject property for the
2013 tax year. Defendant denied the application. Plaintiff appealed the denial, as well as the
reasonableness of the 2013 tax year assessment of $213,000 allocated as follows3:
Land: $ 64,700
Improvement: $148,300
Total: $213,000
Plaintiff then moved for summary judgment under R. 4:46-1, requesting the court find the
subject property exempt from local property tax for 2013, under N.J.S.A. 54:4-3.6. Plaintiff’s
motion is premised on two arguments: (1) plaintiff’s use of the subject property as of the October
1, 2012 valuation date satisfies the criteria for local property tax exemption under N.J.S.A. 54:4-
3 Defendant did not levy an added assessment on the subject property for the 2013 tax year. For tax year 2014,
plaintiff’s application for exemption from local property tax was granted by defendant.

4
3.6; and, (2) the lack of a temporary or final certificate of occupancy has no bearing on the criteria
for local property tax exemption under N.J.S.A. 54:4-3.6. Plaintiff relies on the holding in Society
of the Holy Child Jesus v. City of Summit, 418 N.J. Super. 365 (App. Div. 2011), in support of
its position that issuance of a temporary or final certificate of occupancy is not seminal in gauging
actual use.
In further support of its motion, plaintiff submitted the certification of its minister. The
certification disclosed that during construction, the minister conducted a daily 20-minute morning
prayer service in the subject property. The prayer service was held for approximately 10 people
per day, consisting of church members and their spouses, who were part of the construction team.
According to the minister, the prayer service included holding hands, reading scripture, singing,
and concluded with a prayer and blessing of the construction team as they began their day. The
minister’s certification asserts that “community religious services began some time [sic] around
September” and “formal [religious] services commenced around the time of Thanksgiving 2012.”
Thus, plaintiff maintains that it satisfied the actual use criteria under N.J.S.A. 54:4-3.6 as of the
October 1, 2012 valuation date, despite the lack of a temporary or final certificate of occupancy
for the subject property.
In its cross-motion, defendant maintains the subject property was not actually used, and
could not be used by the public for religious purposes as of the October 1, 2012 valuation date.
Thus, defendant seeks partial dismissal of plaintiff’s complaint.4 Defendant submits that due to
the incomplete state of construction, and lack of a certificate of occupancy, public use of the subject
property for religious purposes was not authorized or permitted, as of the October 1, 2012 valuation
4 Defendant’s cross-motion misstated the standard for granting local property tax exemption for corporations
organized exclusively for religious purposes under N.J.S.A. 54:4-3.6 as “actually and exclusively” used. During
oral argument, defendant’s counsel acknowledged that in 2001, N.J.S.A. 54:4-3.6 was amended to remove the
exclusivity element, requiring that “all buildings actually used in the work of associations and corporations
organized exclusively for religious purposes.” N.J.S.A. 54:4-3.6.

5
date. In support of this argument, defendant cites Grace & Peace Fellowship Church, Inc. v.
Township of Cranford, 4 N.J. Tax 391 (Tax 1982), Beranto Towers v. City of Passaic, 1 N.J. Tax
344 (1980), and an unpublished Appellate Division decision.5 Moreover, defendant asserts that
because the subject property was not previously afforded a local property tax exemption, the
continued exempt character exception, under Paper Mill Playhouse v. Township of Millburn, 7
N.J. Tax 78 (Tax 1984), is not applicable to renovation of the commercial warehouse on the subject
property, vitiating any claim for local property tax exemption.
II. Conclusions of Law
A. Summary Judgment
Summary judgment should be granted where “‘the pleadings, depositions, answers to
interrogatories and admissions on file, together with the affidavits, if any, show that there is no
genuine issue as to any material fact challenged and that the [moving] party is entitled to a
judgment or order as a matter of law.’” Alpha I, Inc. v. Director, Div. of Taxation, 19 N.J. Tax 53,
56 (Tax 2000) (citing R. 4:46-2). Rule 4:46-2 outlines the circumstances under which a motion
for summary judgment should be granted:
if the pleadings, depositions, answers to interrogatories and
admissions on file, together with the affidavits, if any, show that
there is no genuine issue as to any material fact challenged and that
the moving party is entitled to a judgment or order as a matter of
law.
[R. 4:46-2.]
In Brill v. Guardian Life Insurance Company of America, our Supreme Court adopted the
federal approach to resolving motions for summary judgment, in which “the essence of the inquiry
is . . . whether the evidence presents a sufficient disagreement to require submission to a jury or
5 City of Newark v. (148) Block 1861, Lot 24, 605-611 Central Avenue, 2010 N.J. Super. Unpub. LEXIS 2352 (App.
Div. 2010). However, the court notes that “[n]o unpublished opinion shall constitute precedent or be binding upon
any court.” R. 1:36-3; see also Trinity Cemetery Ass’n v. Township of Wall, 170 N.J. 39, 48 (2001).

6
whether it is so one-sided that one party must prevail as a matter of law.” 142 N.J. 520, 536 (1995)
(quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986)). In conducting this
inquiry, the trial court must engage in a “kind of weighing that involves a type of evaluation,
analysis and sifting of evidential materials.” Ibid. The standard established by our Supreme Court
in Brill is as follows:
[W]hen deciding a motion for summary judgment under R. 4:46-2,
the determination whether there exists a genuine issue with respect
to a material fact challenged requires the motion judge to consider
whether the competent evidential materials presented, when viewed
in the light most favorable to the non-moving party in consideration
of the applicable evidentiary standard, are sufficient to permit a
rational factfinder to resolve the alleged disputed issue in favor of
the non-moving party.
[Id. at 523.]
In considering all of the material evidence before it with which to determine if there is a
genuine issue of material fact, the court must view most favorably those items presented to it by
the party opposing the motion and all doubts are to be resolved against the movant. Ruvolo v.
American Casualty Co., 39 N.J. 490, 499 (1963). The moving party bears the burden “to exclude
any reasonable doubt as to the existence of any genuine issue of material fact” with respect to the
claims being asserted. United Advertising Corp. v. Borough of Metuchen, 35 N.J. 193, 196 (1961).
However, if the party opposing the motion merely presents “facts which are immaterial or of an
insubstantial nature, a mere scintilla, fanciful, frivolous, gauzy or merely suspicious,” then an
otherwise meritorious application for summary judgment should not be defeated. Judson v.
Peoples Bank and Trust Co., 17 N.J. 67, 75 (1954) (citation and internal quotation marks omitted).
Thus, “[b]y its plain language, R. 4:46-2 dictates that a court should deny a summary judgment
motion only where the party opposing the motion has come forward with evidence that creates a
‘genuine issue as to any material fact challenged.’” Brill, 142 N.J. at 529.

7
In applying these standards to plaintiff’s motion and defendant’s cross-motion for summary
judgment, the court finds that no dispute exists, as to the following material facts: (a) plaintiff is a
New Jersey nonprofit corporation, organized exclusively for religious purposes; (b) plaintiff’s
operations on the property are not conducted for profit; (c) the use of the subject property, prior to
plaintiff’s acquisition, was not tax-exempt; (d) for the 2009 to 2012 tax years, the subject property
was not exempt from local property tax under N.J.S.A. 54:4-3.6; (e) for the 2009 to 2012 tax years,
plaintiff did not challenge the denial of any application for local property tax exemption; (e) a
temporary certificate of occupancy for the subject property was issued on April 15, 2013; and (f)
a final certificate of occupancy for the subject property was issued on July 23, 2013.
Thus, the legal issues facing this court are: (1) whether plaintiff was actually using the
subject property for its religious purposes, as of the October 1, 2012 valuation date; and, (2) was
the subject property available to the public for religious services, absent issuance of a temporary
or final certificate of occupancy, as of the October 1, 2012 valuation date.
B. Local Property Tax Exemption
Unless expressly exempted by our Legislature, “[a]ll property real and personal. . . shall be
subject to taxation annually. . . .” N.J.S.A. 54:4-1. Our State’s Constitution of 1947 expressly
limits the Legislature’s authority to grant an exemption from local property tax, providing in part,
that “[e]xemption from taxation may be granted only by general laws.” N.J. Const. art. VIII, § 1,
¶ 2. Thus, the grant of a local property tax exemption represents a significant departure from the
principle of equality of treatment and the duty to share the tax burden.
Moreover, in considering the grant of a local property tax exemption, our Legislature “must
base exemptions on the property’s use, not the owner’s identity.” Township of Holmdel v. New
Jersey Highway Authority, 190 N.J. 74, 87 (2007). Thus, tax exemption statutes, which are “based
on the personal status of the owner rather than on the use to which the property is put, run afoul

8
of” our State’s Constitutional mandate that all property be “assessed for taxation under general
laws and by uniform rules.” New Jersey Turnpike Authority v. Township of Washington, 16 N.J.
38, 44-45 (1954) (citation and internal quotation marks omitted).
N.J.S.A. 54:4-3.6 affords the following property an exemption from local property tax
stating, in pertinent part, that:
[t]he following property shall be exempt from taxation under this
chapter . . . all buildings actually used in the work of associations
and corporations organized exclusively for religious purposes,
including religious worship, or charitable purposes, provided that if
any portion of a building used for that purpose is leased to a profit-
making organization or is otherwise used for purposes which are not
themselves exempt from taxation, that portion shall be subject to
taxation and the remaining portion shall be exempt from taxation,
and provided further that if any portion of a building is used for a
different exempt use by an exempt entity, that portion shall also be
exempt from taxation. . . .
[N.J.S.A. 54:4-3.6.]
Because exemption from local property tax represents a marked departure from our State’s
constitutional tenets and compelling public policy principles, tax-exemption statutes must be
strictly constructed against the claimant. Accordingly, the burden rests with the claimant to prove
entitlement to local property tax exemption. Princeton University Press v. Borough of Princeton,
35 N.J. 209, 214 (1961); N.J. Carpenters Apprentice Training & Educ. Fund v. Borough of
Kenilworth, 147 N.J. 171, 177-78 (1996), cert. denied, 520 U.S. 1241 (1997).
The “raison d’etre for [affording taxpayers] statutory exemptions from taxation is the
benefit conferred upon the public by such religious, charitable or other similar institutions and the
consequent relief, . . . of the burden imposed on the state to care for and advance the interest of its
citizens.” Grace & Peace Fellowship Church, Inc., 4 N.J. Tax at 399. Thus, in New Jersey, the
grant of a local property tax exemption is viewed as a quid pro quo, for the taxpayer’s performance
of a public service. See Carteret Acad. v. State Bd. of Taxes & Assessment, 102 N.J.L. 525, 528

9
(Sup. Ct. 1926) (“[T]he concession is due as quid pro quo for the performance of a service
essentially public, and which the state thereby is relieved . . . from the necessity of performing.”),
aff’d, 104 N.J.L. 165 (E & A 1927); see also Roman Catholic Diocese of Newark v. Borough of
Ho-Ho-Kus, 42 N.J. 556, 566 (1964) (“The exemption is granted by the State because of the
contribution of the exempt facility to the public good.”).
Moreover, it is well settled that the “tax status of property is fixed as of the assessing date.”
Atlantic County New School, Inc. v. City of Pleasantville, 2 N.J. Tax 192, 195-96 (1981); See City
of Jersey City v. Township of Montville, 84 N.J.L. 43, 44-45 (Sup. Ct. 1913), aff'd, 85 N.J.L. 372
(E. & A. 1913)). Thus, questions of property tax exemption or valuation are determined as of
October 1st of the pretax year. See N.J.S.A. 54:4-23; Catholic Relief Services, U.S.C.C. v.
Township of South Brunswick, 9 N.J. Tax 25, 27 (Tax), aff’d, 9 N.J. Tax 650 (App. Div. 1987).
Here, the relevant valuation or assessing date is October 1, 2012.
When determining whether a property is entitled to an exemption from local property tax
our courts have adopted a three-prong test: “‘(1) [the owner of the property] must be organized
exclusively for the [exempt purpose]; (2) its property must be actually . . . used for the tax-exempt
purpose; and (3) its operation and use of its property must not be conducted for profit.’” Hunterdon
Medical Center v. Township of Readington, 195 N.J. 549, 561 (2008) (quoting Paper Mill
Playhouse v. Township of Millburn, 95 N.J. 503, 506 (1984)). This three-prong test, promulgated
in Paper Mill Playhouse has been applied to religious organizations like plaintiff. See Roman
Catholic Diocese of Newark v. City of East Orange, 18 N.J. Tax 649, 653 (App. Div. 2000).
In gauging whether a property is actually used for a tax-exempt purpose, our courts
consider “‘whether the property is ‘reasonably necessary’ for such [tax exempt] purposes.’” Id. at
653 (citing and quoting City of Long Branch v. Monmouth Medical Center, 138 N.J. Super. 524,
532 (App. Div. 1976), aff’d o.b., 73 N.J. 179 (1977). However, when applying this standard, our

10
Supreme Court has cautioned that the term “necessary” should not be interpreted as “absolutely
indispensable.” Boys’ Club of Clifton, Inc. v. Township of Jefferson, 72 N.J. 389, 401 (1977).
1. Actual use; fully operating institution
Cases addressing a tax exemption predicted upon construction of a new building for a
property not previously tax-exempt, have principally focused on whether as of the assessing date,
the property was in actual use, or was a fully functional establishment prepared to offer its
charitable services to the public. Institute of Holy Angels v. Borough of Fort Lee, 80 N.J.L. 545
(Sup. Ct. 1910); Young Men’s Christian Ass’n of the Oranges v. City of Orange, 3 N.J. Misc. 404
(Sup. Ct. 1925); Borough of Longport v. Max & Sarah Bamberger Seashore Home, 91 N.J.L. 330
(E. & A. 1917); Trenton Ladies Sick Benefit Soc. v. City of Trenton, 19 N.J. Misc. 176 (1941);
Grace & Peace Fellowship Church, Inc., 4 N.J. Tax 391; Holy Cross Precious Zion Glorious
Church of God v. City of Trenton, 2 N.J. Tax 352 (Tax 1981). Stated differently, the inquiry is
whether the property was, as of the assessing date, a “fully operating institution, ready and waiting
to expend its charitable endeavors on those who might apply for them.” Trenton Ladies Sick
Benefit Soc., 19 N.J. Misc. at 177.
In Institute of Holy Angels, 80 N.J.L. 545, the taxpayer was denied a local property tax
exemption for a building that was under construction and not in use during the tax year. Our
former Supreme Court, strictly construing the exemption statute, stated that in order for a building
to be qualified as exempt, it must be actually used, and a taxpayer’s intended charitable use was
insufficient to exempt it from taxation. Id. at 546.
Similarly, in Max & Sarah Bamberger Seashore Home, the Court of Errors and Appeals
denied the taxpayer’s local property tax exemption, affirming the lower court’s finding that the
“institution was not actually opened and in use,” until after the assessment date. 91 N.J.L. 330, 331
(E. & A. 1917).

11
In Young Men’s Christian Ass’n of the Oranges, 3 N.J. Misc. 404, the taxpayer sought an
exemption from local property tax on an unfinished building. In denying the exemption, the court
emphasized that our exemption statutes must be strictly construed in considering the grant of
immunity from taxation. The court found that because the property was not actually and
exclusively used as of the assessing date, the taxpayer’s exemption claim must be denied. Id. at
405.
In Trenton Ladies Sick Benefit Soc., 19 N.J. Misc. 176, the taxpayer sought local property
tax exemption on a building acquired, remodeled, and converted into a home for “aged indigent
persons.” Id. at 176. There, the record disclosed that remodeling of the building was complete
“well in advance of the assessing date,” and that the taxpayer had “a fully operating institution,
ready and waiting to expend its charitable endeavors on those who might apply for them.” Id. at
177. Although no resident occupied the facility on the assessing date, the court found it of no
“consequence that the machinery of charity. . . found no object for its beneficence,” until after the
assessing date. Ibid. Thus, being open and available to the public, ready, and able to perform its
charitable functions, was the essential public service received by the State as the quid pro quo for
the grant of a local property tax exemption.
In Holy Cross Precious Zion Glorious Church of God, 2 N.J. Tax 352, the taxpayer
acquired a parcel of property containing a vacant building, gutted by fire that had not been
previously exempt from taxation. The taxpayer intended to use the property as a religious nursery
school and day care center for its parishioners, and following its purchase, “embarked upon a
program of rebuilding the premises.” Id. at 354. However, due to financial constraints, and
escalating costs for labor and materials, completion of the building was delayed for a period in
excess of two years. In analyzing whether the property was open and available to the public for
use, the court emphasized that actual use, not intended use, was the standard for granting local

12
property tax exemption in New Jersey. Id. at 357. The court stated that an intention to use property
for a tax-exempt public purpose, coupled with ongoing renovations and remodeling, failed to
satisfy the actual use standard under N.J.S.A. 54:4-3.6. The court further remarked that prior case
law dictated that “property which is fully built but not yet open for use” is not eligible for
exemption, under N.J.S.A. 54:4-3.6. Id. at 357-58 (emphasis added).
In Grace & Peace Fellowship Church, Inc., 4 N.J. Tax 391, the taxpayer, a New Jersey
nonprofit religious corporation, conducted religious services in a rented facility in an adjoining
municipality. Id. at 393. The taxpayer acquired a parcel of vacant land, seeking to construct its
own church and educational facility. Id. at 394. During the period of construction, the church
continued to perform its principle religious services in the rented facility, and following enclosure
of the newly constructed structure, conducted weekly and monthly prayer services “within the
partially completed edifice.” Ibid. The monthly and weekly prayer services in the partially
completed structure were held for members of the church’s congregation that supplied volunteer
labor to construct the new facility. Ibid.
As of the assessment date, the exterior of the newly constructed building was complete,
“the heating system and most of the electrical wiring had been installed,” and the remaining work
focused on completion of interior improvements. Ibid. However, “religious services were not
available to the public until February 28, 1980, [five months after the assessing date,] when
plaintiff received its temporary certificate of occupancy.” Id. at 395.
The defendant, in Grace & Peace Fellowship Church, Inc., conceded that the taxpayer met
the statutory exemption requirements except for the actual use requirement. Ibid. It maintained
that the building “cannot be exempt because it was not fully completed, i.e., not ready for public
occupancy. . . prior to the issuance of a certificate of occupancy, whether temporary or permanent
. . . .” Ibid. The defendant further argued that even if the use was considered lawful, the services

13
carried on at the property were incidental and thus insufficient to warrant an exemption. Id. at
396. In considering the taxing district’s arguments, the court remarked that the “actual use and
not intended use controls in the determination of a tax exemption.” Id. at 398 (citing Institute of
Holy Angels, 80 N.J.L. 545 (1910); Max & Sarah Bamberger Seashore Home, 91 N.J.L. 330
(1917)).
Declining to grant the taxpayer a local property tax exemption, the court expressed that the
“single thread” pervasive throughout our State’s case law, is that:
there must be actual use made of the buildings in accordance with
the exemption statute. Actual public use or being ready to provide
such public use is the required quid pro quo. Mere intention to use
for an exempt purpose at some time in the future will not suffice.
[Id. at 399-400 (citing Trenton Ladies Sick Benefit Soc., 19 N.J.
Misc. 176) (emphasis added).]
As stated above, the policy behind granting a local property tax exemption relates to the
quid pro quo, afforded to a taxpayer for relieving the government from the obligation to furnish a
public service. “[W]ithout the performance of some service essentially public which relieves the
state pro tanto from the necessity of performance, the exemption becomes essentially a gift of
public funds.” Id. at 399 (citing The Kimberly School v. Township of Montclair, 137 N.J.L. 402,
405-06 (Sup. Ct. 1948), rev’d on other grounds, 2 N.J. 28 (1949)). Thus, the court concluded, “the
language in N.J.S.A. 54:4-3.6 can reasonably be construed to mean that the exemption is not to be
allowed unless the institution actually is in a position to provide the services or benefits deemed
important enough to cause the exception from the rule of taxation.” Id. at 400.
Applying this analysis to the facts in the instant matter, the court discerns that as of the
October 1, 2012 assessing date, plaintiff was making limited use of the partially renovated
structure on the subject property by conducting daily 20-minute morning prayer services.
However, these prayer services were incidental to the prayer services, offered by the taxpayer, in

14
its adjacent building, and were limited to church members, who were part of the construction team,
offering inspirational blessings as they began their workday to renovate the subject property.
These prayer services were not available to the public and do not constitute actual use, as
contemplated under N.J.S.A. 54:4-3.6.
Moreover, plaintiff’s minister readily acknowledged that “formal [religious] services
commenced [in the subject property] around the time of Thanksgiving 2012,” some six to seven
weeks after the October 1, 2012 assessing date. Significantly, a temporary certificate of
occupancy, lawfully permitting the subject property to be occupied and used by the public for its
intended religious purpose, was not issued until April 15, 2013, some six months after the assessing
date. The record before the court further discloses that construction on the subject property
continued after the October 1, 2012 assessing date, with interior finish work being performed, and
building construction code inspections for the fire alarm system, interior building finishes,
mechanical systems, building, and electrical systems, being conducted on November 30, 2012,
December 30, 2012, January 3, 2013, July 1, 2013, and July 23, 2013.
Plaintiff argues that its construction invoices, for the period, July 2012 through October
2012, demonstrate that finish carpentry work was being performed on the subject property, which
commenced only after the interior demising walls were erected. However, plaintiff’s arguments
are misplaced, as the character of the construction work being performed as of the assessing date
is not the barometer by which the court measures the appropriateness of the grant or denial of a
local property exemption. Our courts have declared that, in the context of strictly construing the
exemption under N.J.S.A. 54:4-3.6, the property must be actually used by the public or must be
actually available for such use. A goal, intent, or objective to furnish, on some future date, a tax-
exempt purpose for the benefit of the public is insufficient to establish the requisite quid pro quo.
As Judge Andrew fittingly pointed out, had our “Legislature intended that an exception to the rule

15
of taxation apply during the course of construction of a building partially used or to be used for
exempt purposes, it could have expressly so provided.” Grace & Peace Fellowship Church, Inc., 4
N.J. Tax at 400.
Here, plaintiff was not in a position to provide its services and/or benefits to the public, as
of the October 1, 2012 assessment date. As a result of ongoing construction and renovations, the
structure was not available, nor was it ready to be occupied and used by the public for religious or
charitable activities until sometime following the October 1, 2012 assessment date. Thus, as of
the assessing date, the only recipients of plaintiff’s religious services on the subject property were
the parishioners and their spouses, who were part of the construction team, dedicated to renovating
the structure. Neither the public, nor the vast majority of plaintiff’s congregation derived any
benefit from the partially completed structure as of the October 1, 2012 assessing date. Thus, no
quid pro quo was offered by plaintiff thereby entitling it to tax exemption for the subject property.
Therefore, for the above-stated reasons, the court concludes that the subject property was
not exempt from local property tax for the 2013 tax year.
2. Certificate of Occupancy
Plaintiff asserts that the failure of a temporary or final certificate of occupancy to issue as
of the assessing date, is not dispositive of actual use under N.J.S.A. 54:4-3.6. In support of this
position, plaintiff relies upon Society of the Holy Child Jesus, 418 N.J. Super. 365.
In response, defendant maintains that because a temporary certificate of occupancy was
not issued until April 15, 2013, actual use of the subject property was not possible until six months
following the assessing date. Relying on Grace & Peace Fellowship Church, and the unpublished
decision in City of Newark v. (148) Block 1861, Lot 24, 605-611 Central Avenue, defendant
argues that the subject property cannot be viewed as actually in use for religious activities as of
the October 1, 2012 valuation date.

16
In Society of the Holy Child Jesus, the Appellate Division was asked to determine whether
a change in use of an already tax-exempt property, resulting in a violation of the municipal zoning
ordinance, should be considered by the court in resolving the actual use criteria under N.J.S.A.
54:4-3.6. The court declared the language of N.J.S.A. 54:4-3.6 to be “unambiguous,” concluding
that the statute “does not require the property be a lawful use under the municipality’s zoning
ordinance in order to qualify for tax exemption.” Id. at 386. Rejecting the trial court’s engrafting
of a requirement that actual use comport with municipal zoning ordinances, the Appellate Division
concluded that a taxpayer is entitled to “exemption if its use of the property is consistent with the
tax-exempt purposes embodied” under the statute. Id. at 386. Accordingly, the court afforded the
taxpayer the local property tax exemption.
However, the facts in Society of the Holy Child Jesus are distinguishable from the instant
matter. There, the property was used as a residence for nuns, and afforded a local property tax
exemption for approximately 61 years. The taxpayer discontinued the property’s use as a
residence, but continued using the property for other school related purposes. As a result of the
change, the municipality revoked the taxpayer’s local property tax exemption, claiming that such
use violated a municipal zoning ordinance. Here, however, the subject property was never exempt
from local property tax and plaintiff was not changing a tax-exempt use of the subject property.
As the court observed in Paper Mill Playhouse, “an exemption predicated upon construction of a
new building on property which had not previously been exempt,” is distinguishable from the
revocation of a tax exemption resulting from a casualty or a change in use. 7 N.J. Tax at 84.
Therefore, while the court in Society of the Holy Child Jesus concluded that, the tax-exempt use
and corresponding quid pro quo subsisted, here the court cannot reach the same conclusion.
Significantly, in Society of the Holy Child Jesus, no construction, renovations, or
improvements were undertaken on the property requiring building permits, instead, the

17
municipality’s claim for revocation of the local property tax exemption stemmed from an alleged
violation of municipal zoning ordinances governing use of the property. Conversely, in the instant
matter, substantial construction and improvements requiring building permits were undertaken to
the subject property during the eleven months leading up to the October 1, 2012 valuation date,
and were ongoing after such date. The certifications and exhibits of the parties submitted in
support of their motions discloses that construction continued after the October 1, 2012 assessing
date, with interior finish work being performed, and building sub-code inspections for the fire
alarm, interior building finishes, mechanical systems, and electrical systems not being concluded
until November 30, 2012, December 30, 2012, January 3, 2013, July 1, 2013, and July 23, 2013.
Thus, here plaintiff was unable or incapable of expending “its charitable endeavors on those who
might apply for them” Trenton Ladies Sick Benefit Soc., 19 N.J. Misc. at 177. These issues and
conditions were not present in Society of the Holy Child Jesus.
The ongoing renovations and improvement activities on the subject property as of the
assessment date directly affected not only the potential use of the subject property, but the health,
safety, and welfare of the occupants and users of the property. A temporary certificate of
occupancy, evidencing that the subject property was safe for the users and occupants, and
establishing that the newly undertaken construction conformed with basic tenets of the State
Uniform Construction Code (“UCC”), was not issued until April 15, 2013, six months following
the assessing date. Nevertheless, plaintiff maintains that it impermissibly, and in violation of the
UCC, made actual use of the subject property for religious purposes prior to issuance of the
temporary certificate of occupancy.
In enacting the State Uniform Construction Code Act, N.J.S.A. 52:27D-119 to -141 , our
Legislature sought to address escalating construction costs, reduce the “divergent and burdensome
municipal construction codes,” and provide a standardized and uniform construction code with up

18
to date construction standards. DKM Residential Props. Corp. v. Township of Montgomery, 182
N.J. 296, 303 (2005). As our Supreme Court has remarked, the UCC was primarily “designed to
address directly matters affecting health, safety and welfare.” Ibid. The UCC provides in part,
that:
[n]o building or structure hereafter constructed shall be used or
occupied in whole or in part until a certificate of occupancy shall
have been issued by the enforcing agency. . . A certificate of
occupancy shall be issued by the enforcing agency when all of the
work covered by a construction permit shall have been completed in
accordance with the permit, the code, and other applicable laws and
ordinances. . . On request of a holder of a construction permit, the
appropriate enforcing agency may issue a temporary certificate of
occupancy for a building or structure, or part thereof, before the
entire work covered by the construction permit has been completed,
if the part or parts of the building or structure to be covered by the
certificate may be occupied prior to completion of all work in
accordance with the permit, the code, and other applicable laws and
ordinances, without endangering the health and safety of the
occupants or users. . . The certificate of occupancy shall certify that
the building or structure has been constructed in accordance with the
provisions of the construction permit, the code, and other applicable
laws and ordinances.
[N.J.S.A. 52:27D-133 (emphasis added).]
Thus, the UCC strictly prohibits the use or occupancy of a structure until a certificate of
occupancy has issued. In enacting the UCC, the legislature sought to afford a measure of flexibility
to construction permit holders, authorizing issuance of temporary certificates of occupancy when
the scope of work has been substantially completed and occupancy of the structure can be
accomplished without endangering the health and safety of the occupants or users. Ibid.
This court cannot envision that our Legislature intended to condone behavior of a taxpayer
who/which attempts to make actual use of a property under construction, and not previously
afforded a tax exemption, prior to the date that such property is permitted to be occupied and used,
in order to qualify for local property tax exemption under N.J.S.A. 54:4-3.6. Such actions

19
jeopardize public safety and are counterintuitive to the very purposes of the exemption statute,
which is to offer the public a service in an environment free from danger, thereby relieving the
State from a concomitant burden. In requiring that newly constructed or substantially renovated
buildings be actually used for a tax-exempt purpose, or available for such use, this court interprets
N.J.S.A. 54:4-3.6 as implying that the use cannot be achieved at the expense of the safety, welfare,
and well-being of the public, the intended beneficiaries of the non-profit entity’s bounty. As
eloquently expressed by Judge Andrew in Grace & Peace Fellowship Church, Inc., 4 N.J. Tax 391,
it is difficult to “conceive that the Legislature had intended to encourage the use of incomplete
structures so that taxpayers could avoid taxation during the construction period. A denial of an
exemption discourages the use of incomplete and unsafe structures and fosters a policy in
accordance with our construction codes.” Id. at 401.
Here, the subject property was not previously afforded a tax exemption, and due to the
extensive construction and renovations being performed on the subject property, required a
temporary certificate of occupancy to use the property for plaintiff’s intended religious purposes.
However, the record reveals that a temporary certificate of occupancy was not issued until six
months following the October 1, 2012 assessing date. Therefore, the subject property cannot be
viewed as actually in use, or fully available for use for religious activities, under N.J.S.A. 54:4-3.6
as of the October 1 2012 valuation date.
However, the court must highlight that its holding in this matter is circumscribed to those
properties that: (1) have not previously been granted tax exemption; (2) are experiencing new
construction or renovation to permit an intended use of the property for an exempt purpose; and
(3) have not been the subject of an added assessment. Accordingly, this court’s holding must be
distinguished from those matters that involve the intersection of the added assessment statute,
N.J.S.A. 54:4-63.1 to – 63.11, and the tax exemption statute, N.J.S.A. 54:4-3.6.

20
Pursuant to N.J.S.A. 54:4-63.3, an added assessment may be imposed on a property if it
“contains any building or other structure which has been erected, added to or improved after
October 1 and completed between January 1 and October 1 following. . . .” Similarly, N.J.S.A.
54:4-63.2 permits an assessor to levy an added assessment when a building or other structure has
“been erected, added to or improved after October 1 in any year and completed before January 1.
. . .” The added assessment statutory scheme represents a marked departure from the taxing
principles espoused under N.J.S.A. 54:4-23, requiring an assessor to “determine the full and fair
value of each parcel of real property situate in the taxing district. . . on October 1 next preceding
the date on which the assessor shall complete his assessments. . . .” N.J.S.A. 54:4-23.
Our courts have recognized the distinction that exists between N.J.S.A. 54:4-23 and
N.J.S.A. 54:4-63.3 or N.J.S.A. 54:4-63.2 in gauging eligibility for local property tax exemption.
In Schizophrenia Foundation of New Jersey v. Township of Montgomery, 6 N.J. Tax 439 (App.
Div. 1984), the Appellate Division observed that:
[i]t is axiomatic that ordinarily October 1 of the pretax year is the
controlling date to determine whether a property will be exempt
from taxes. Thus a change of use and ownership of a property after
October 1 of the pretax year to an exempt status will not invalidate
an assessment for a tax year. But obviously such a situation differs
from our case since here there was no assessment on the building on
October 1 of the pretax year. In the case of a building completed
between January 1 and October 1 of a tax year the assessor
determines for added assessment purposes the taxable value of the
property as of the first day of the month following completion. This
process of determining value for added assessment purposes is
similar to the assessor's obligation to determine value of an existing
building as of October 1. The determination of value includes a
decision as to whether the property is exempt from taxes.
[Id. at 441-42 (internal citations omitted).]
As a result, the court concluded that “the tax status of property subject to an added assessment
should be ascertained as of the date of the [added] assessment.” Id. at 442 (emphasis added).

21
Similarly, in Presbyterian Home at Pennington, Inc. v. Borough of Pennington, 409 N.J.
Super. 166, 190 (App. Div. 2009), the Appellate Division found that the trial court erred in
allowing the municipal assessor to assess the “facility as though it were substantially complete and
operational on October 1, 2001, while denying its tax exempt status for both the land and
improvements on the basis that it was not operational.” Applying the “substantially ready” test
under N.J.S.A. 54:4-63.2, the court concluded that if the improvements were not substantially
complete as of the October 1, 2001 assessing date, then “the land should have been taxed as non-
exempt for 2002, but the improvements valued [under the added assessment statute] as of the first
day of the month following completion and, at that point, accorded tax exempt status.” Id. at 192.
However, the subject property’s tax assessment does not stem from the imposition of an
added assessment. In general, absent acquisition of a property by the State or a State Agency,
demolition or destruction of a building, or the levying of an added, omitted added, or omitted
assessment, our enabling statutes do not permit assessors to re-examine and re-cast the tax status
of a property after the October 1st valuation date. See Schizophrenia Foundation of New Jersey, 6
N.J. Tax at 441-42; N.J.S.A. 54:4-3.3b; N.J.S.A. 54:4-35(a); N.J.S.A. 54:4-63.1 to -63.11.
Here the subject property was not afforded tax-exempt status for the 2009 to 2012 tax years
and thus, was annually assessed a local property tax during those tax years. The subject property
was identified as a ratable on defendant’s 2012 tax roll and was relied upon by the municipality in
determining its 2013 annual budget. The underlying viewpoint of N.J.S.A. 54:4-3.6 requires “an
exempt use to exist on the October 1 assessing date in order to permit taxing districts to prepare
budgets based upon the current tax assessment rolls. Any reduction in the assessment roll during
the tax year would interfere with that budget preparation procedure.” Paper Mill Playhouse, 7 N.J.
Tax at 86 (citing Schizophrenia Foundation of New Jersey, 6 N.J. Tax 439); see also City of East
Orange v. Palmer, 47 N.J. 307 (1966). Thus, the probative date in this matter for examination of

22
the actual use of the subject property was the October 1, 2012 assessment date, and not some later
date.
As stated hereinabove, the subject property was not ready to be occupied and used by the
public for a tax-exempt purpose until sometime following the October 1, 2012 assessment date.
Therefore, it is not entitled to a local property tax exemption for the 2013 tax year.
III. Conclusion
For the foregoing reasons, plaintiff’s motion for summary judgment is denied, and
defendant’s cross-motion for partial-summary judgment, dismissing those counts of plaintiff’s
complaint which lay challenge to the denial of the 2013 local property tax exemption, is granted.