Appellate court denies Strathmere de-annexation

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UPPER TOWNSHIP – A New Jersey Appellate Court Wednesday ruled unanimously against a suit by Strathmere residents seeking to de-annex from Upper Township.

Citizens for Strathmere and Whale Beach petitioned the township for de-annexation in 2007, claiming a lack of adequate services from Upper Township. The local planning board conducted 18 meetings on the matter through 2008 and 2009, ultimately recommending against the de-annexation petition. Township committee denied the petition in 2009.

Citizens for Strathmere and Whale Beach filed suit in New Jersey Superior Court but was denied in a 2010 ruling by Judge Valerie Armstrong. The Appellate Court Division ruling this week affirms Armstrong’s ruling.

Mayor Richard Palombo said the unanimous ruling was a major victory for Upper Township and its taxpayers. Strathmere represents 17.5 percent of the township’s ratable base. Its loss would have meant substantial increases in school and local purposes taxes here, he said.

“I want to thank the attorneys who represented the township and the planning board, our solicitor Dan Young, planning board attorney Dean Marcolongo and our outside counsel Frank Corrado,” said Palombo. “They did a great job.”

The township has spent almost $400,000 arguing the de-annexation case over the past five years. Palombo said during that time Strathmere has provided almost $20 million in tax revenue to the school system.

“It was very important Strathmere remains a part of Upper Township,” he said.

Citizens for Strathmere and Whale Beach argued before the planning board and in court that it has been treated like second class citizens by mostly-mainland Upper Township. The group said services in Strathmere weren’t adequate, police response time was too long, and that Strathmere’s de-annexation wouldn’t really hurt the township, just the school system.

The Appellate Court Division, like Armstrong, said the Strathmere group’s definition of the township, which did not include the school system, was too narrow.

“We agree with Judge Armstrong that the committee applied the proper legislative standard when it determined that the de-annexation would cause significant injury to the well-being of the municipality in which the land is located as a result of the loss of revenues to the school district, and the concomitant increase in property taxes for the remaining taxpayers,” reads the Appellate Court ruling. “Plaintiff's contention that the word ‘municipality’ in N.J.S.A. 40A:7-12.1 means the municipal government and not any of the municipality's constituent parts, such as a school district, a municipal sewage authority, municipal fire district, a municipal water authority, or other municipal entities is too constrained a reading of the word and is not consistent with the legislative intent or jurisprudence interpreting the statute.”

In 2007, when Citizens for Strathmere and Whale Beach first petitioned the township for de-annexation, Strathmere sent four out of 2,388 students to Upper Township schools. But property owners there paid $4 million in school taxes each year.

The township and planning board held that Strathmere’s de-annexation would increase school taxes in the remaining parts of Upper Township by 20 percent. The owner of a $350,000 home would see school taxes increase $700 a year.

That showed a substantial injury to taxpayers in Upper Township, a big hurdle Citizens for Strathmere and Whale Beach could never really overcome. New Jersey’s De-annexation Statute requires petitioners to establish that de-annexation will not cause a significant injury to the well-being of those remaining in the township.

In planning board testimony and its complaint in court, lawyers for Citizens for Strathmere and Whale Beach argued that since Upper Township did not have a local purpose tax, the tax increase would not constitute a “significant injury to the well-being of the township.” So the average $700 property tax increase, which would actually go to school taxes, should not be considered, they said.

Upper Township Committee has since instituted a local purpose tax. Before that, however, Armstrong said in her ruling that consideration of the impact on school taxes was expressly approved by the Appellate Court Division when Avalon Manor attempted to secede from Middle Township in 2000. The Appellate Court Division ruling this week affirms that opinion.

“Only the most tortured and distorted reading of the De-annexation Statutes would lead to the conclusion that the economic impact upon schools within municipal boundaries is not a proper subject to be included in the deliberations,” Armstrong wrote in her 2010 ruling.

Armstrong wrote in her ruling that Strathmere would benefit from being part of a homogenous community with Sea Isle City and might see an increase in the frequency of trash pickup. The harm to Upper Township was evident, however, if it lost “a unique upscale residential community, which provides free beaches, and free street parking adjacent to those beaches.”

The detriment to losing such an upscale community as Strathmere can’t be dismissed as “snob appeal,” added Armstrong.

Armstrong also addressed Citizens for Strathmere and Whale Beach’s claim that Upper Township Committee was arbitrary and unreasonable in denying the de-annexation. She said the decision was neither arbitrary nor unreasonable given the record established by months of planning board hearings, which were then given to township committee.

Citizens for Strathmere and Whale Beach wanted Strathmere become a part of Sea Isle City. Property taxes in Strathmere would have been reduced 40 to 50 percent if it annexed to Sea Isle City, according to court filings.

Strathmere was originally part of a community known as Ludlam’s Island, which later became Sea Isle City in 1882. In 1905, Strathmere was annexed to Upper Township in order to allow Sea Isle City to unload a proportionate share of its municipal debt, which at the time of annexation was $935.

The seaside community officially changed its named to Strathmere in 1912, which is why Strathmere celebrated its centennial this year.

Strathmere has a year-round population of approximately 175 residents. There are 3,000 to 4,000 people living there in the summer months.

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