BY SETH MANDEL
Staff Writer

MONROE — Setting a landmark precedent in farmland taxation, the state Supreme Court has ruled that greenhouses owned by William Gasko in Monroe Township, Middlesex County, cannot be taxed as retail uses.

In a unanimous decision, the court overturned the decision of a state Appellate Court on the 6.5 acres of Gasko greenhouses, where customers are invited inside to browse and purchase products.

“I think it will help all growers in the state of New Jersey,” said William Gasko’s son, Pete, who is a partner at the Federal Road farm. “Because the greenhouse is a tool for growing, for one, and the way farming is, we have to have some kind of edge to get the people to buy our product. And if we can let them in the greenhouse for a couple of months of the season, so be it. But it certainly doesn’t make it retail space.”

Pete Gasko, a fourth-generation farmer, said that until 1997 the greenhouses were granted the standard farmland tax exemption. That year, however, the Gaskos added another greenhouse building on the farm.

Gasko said the existing greenhouses were constructed using two-piece support beams. The new greenhouse, however, used one-piece columns.

Monroe Township ruled that the one-piece columns made the greenhouse a permanent structure, which must be taxed.

However, the Middlesex County Board of Taxation ruled that the structure was no different than the other buildings, and was to abide by the same taxation statutes, remaining exempt from assessment.

For the Gaskos, the matter amounted to more than $100,000 per year, as they would have to pay $649,200 in 1998 under the township’s assessment; but $539,500 after the county had it reduced.

Monroe Township officials, however, then took a different approach. Since customers are allowed inside the greenhouse, the township chose to assess the building as retail space, thus disqualifying it from the farmland tax exemption.

The Gaskos appealed that assessment, but the state Superior Court upheld the township’s claim.

In 2003, the Gaskos took the case to the appellate division, which also ruled in favor of the township.

“[The judge’s] analysis was that it didn’t matter if we let one person or 1,000 people into the greenhouse, that made it sale space,” Pete Gasko said.

Because the appellate division’s ruling was unanimous, the Gaskos could not appeal it further, but they could request certification from the state Supreme Court and, if granted, could take the case there.

In January, the Supreme Court agreed to hear the case, and in March ruled unanimously in favor of the Gaskos.

“All seven judges agreed with us,” Pete Gasko said. “They felt that we were true growers, we did grow everything there. The township was trying to make analyses comparing us to Pathmark and stores like that, and some of the judges basically told them that [we] are growers, and that’s the way it is. It’s not different than a ‘you-pick’ farm, basically.”

The Gasko farm has been using greenhouses for about 25 years, growing seasonal flowers. The farm grows a fall crop of mums, pumpkins and corn stalks, and a season of poinsettias for the holiday season.

Gasko said the township would not have considered the greenhouse as “sale space” if the shopping display was outdoors.

But, he said, just inviting customers inside makes clear the distinction between New Jersey farmers and large chain stores.

“That’s what separates us from Home Depot and everything else. We are the growers, and that’s what our argument was. Our biggest draw is allowing people to walk into the greenhouse, see us planting material, see the material growing.”

Gasko said he has been contacted by other area farmers who were excited about the decision, which will set a new precedent for greenhouse owners in the state.

Monroe Township Attorney Joel Shain said the extensive effects of the decision are due to the fact that the ruling was not simply a legal reversal, but in effect, a policy modification.

“It was a major policy change that they made regarding the tax structure as it affects the greenhouses in New Jersey,” Shain said. “This is a case that has far-reaching consequences. It doesn’t only affect the Gasko operation, but it would affect operations that are similarly situated throughout the state.”

Shain said the decision was not a complete surprise, since it was not technically an appeal. The Supreme Court’s decision to grant the necessary certification implied the case was to be under significant scrutiny.

“When the Supreme Court took certification, there was concern that they would reverse the decision of the appellate division,” Shain said.

Gasko’s family has been in Monroe Township, just outside Englishtown, since the early 1900s, and most of the family still lives in town. Because of that, Pete Gasko said, he was surprised the township would even pursue the taxation of his farm so vehemently.

“I think we were picked out because we were one of the larger [indoor greenhouses], honestly, and I think they were trying to make an example of us. And I think it backfired,” Gasko said.

Shain said the township applied the existing taxation statutes to the Gasko farm, and the decision of the Supreme Court was a legal interpretation of that statute.