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Gov. Murphy issued EO 130 on April 28, 2020, providing an option for towns to extend the grace period for taxes to be paid from May 11 to June 1. In the Township of Pequannock, taxes remain due on May 1, with a grace period ending on May 11, 2020.
The Township of Pequannock is responsible for the collection of all property taxes, including those that are paid to the Library, County of Morris and Pequannock Township School District. Unfortunately, delaying payments to the Township could create the need for the Township to borrow money to pay the other entities; ultimately increasing the cost to tax payers. Depending on how taxes are paid, this may become necessary regardless of an extension of the grace period but extending the grace period would certainly exacerbate the issue.
The Township is unable to assess need when extending the grace period. In an ideal world, those who need the grace period extended could be provided with an opportunity to take advantage of the additional time. However, the grace period either has to be extended for all or none, as the order doesn’t provide any flexibility. Furthermore, there is no simple way to determine need. Due to the massive economic impact COVID-19 has caused, extending the grace period has the potential to create inequity of benefit between resident tax payers and large banks, which pay through escrow accounts.
The Township was left with a few hours to digest Executive Order -130 from the time it was issued and needed to be discussed by the Township Council. Little room was provided to evaluate what options existed and ultimately the negative impact for all taxpayers, and the fact that there is no grace period for the bills the Township needs to pay, resulted in the decision not to change the grace period.
Should you have any questions, please contact Adam Brewer, Township Manager.