New Jersey Statutes Title 40A. Municipalities and Counties 40A § 21-6

a. If the ordinance adopted pursuant to this act shall provide for the exemption from taxation of improvements to multiple dwellings, or of conversions of other buildings and structures, including unutilized public buildings, to multiple dwelling use, or both, it shall require that, in determining the value of real property, the municipality shall regard up to the assessor's full and true value of the improvements or conversion alterations as not increasing the value of the property for a period of five years, notwithstanding that the value of the property to which the improvements or conversion alterations are made is increased thereby. During the exemption period, the assessment on the property shall not be less than the assessment thereon existing immediately prior to the improvements or conversion alterations, unless an abatement is granted pursuant to subsection b. of this section, or there is damage to the multiple dwelling through action of the elements sufficient to warrant a reduction.

b. An ordinance providing for exemption may also provide for the abatement of some portion of the assessed value of property receiving the exemption as it existed immediately prior to the improvement or conversion alteration. An abatement for a multiple dwelling may be granted with respect to that property for a total of up to five years, but the annual amount of the abatement shall not exceed 30% of the total cost of the improvement or conversion alteration, and the total amount of abatements granted to any single property shall not exceed the total cost of the improvement or conversion alteration. The abatement period and the annual percentage of the abatement to be granted shall be set forth in the ordinance, which may include a schedule providing for a different percentage of abatement, up to 30%, for each year of the abatement period.