New York State   Assembly 

Committee on Real Property Taxation

Scott Stringer, Chairperson
Sheldon Silver, Speaker




December 15, 2002


The Honorable Sheldon Silver
Speaker of the Assembly
Room 932 - Legislative Office Building
Albany, New York 12248

Dear Speaker Silver:

I am pleased to submit the 2002 Annual Report of the Assembly Standing Committee on Real Property Taxation. This was a busy year for the Committee, with a wide range of challenging issues and diverse legislation to consider.

The Committee met nine times and acted on over 250 bills. We reviewed and reported proposed legislation in a variety of areas including exemption administration, general administration, and jurisdiction specific (local) legislation. In addition to our other responsibilities, the Committee worked closely with the New York State Office of Real Property Services (NYS ORPS) to promote informed and responsible legislation.

This year, as in the past, the Committee was immersed in budget negotiations, particularly with respect to the STAR program. Many provisions to improve the STAR program were included in the State Budget. The development of these amendments resulted from our collaboration with the NYS ORPS, local officials and of course, concerned citizens. The Committee will continue to monitor this popular and much needed tax relief program to ensure that it continues to be an effective method of reducing a homeowner's ever-increasing school tax obligation, especially for seniors on fixed incomes.

Other notable and complex issues that the Committee embarked on this year were:

  • New York City's Department of Finance Assessor Corruption Scandal
  • Economic Development Programs (e.g. RESCUE, J-51, Solar/Wind Pilots, etc.)
  • Nassau County Assessment Practices (particularly the grievance process)
  • Railroad - Tax Abatements and Ceilings

In 2003, the Committee will continue to review the effects of the NYC's assessors' corruption scandal, to monitor the effects of past legislation, and to discuss plausible methods in which to provide the residents of New York State with a fair and equitable real property tax system.

I have greatly enjoyed working with the Real Property Tax Committee members. Their knowledge and enthusiasm was instrumental in making this a pleasant and productive year.

Sincerely,

Scott Stringer,
Chairperson
Committee on Real Property Taxation



2002 STANDING COMMITTEE ON

REAL PROPERTY TAXATION

SCOTT STRINGER, CHAIRPERSON

MEMBERS of the COMMITTEE

MAJORITY

James F. Brennan
Jacob E. Gunther, III
Alexander J. Gromack
Joan K. Christensen
Adriano Espaillat
Steve Levy
MINORITY

Sandra Lee Wirth - Ranking
     Minority Member
Nancy Calhoun
COMMITTEE STAFF

Bernard H. Bryan, Legislative Coordinator
Anthony S. Cantore, Legislative Counsel
Andrea K. Nasrallah, Legislative Associate
Karen Smeaton, Legislative Associate
Blake Avalon, Committee Clerk
Mona Carter, Program and Counsel Secretary



TABLE OF CONTENTS

  1. ASSESSORS CORRUPTION SCANDAL - NYC
  2. SCHOOL TAX RELIEF (STAR) PROGRAM
    1. Cost of Living Adjustment
    2. Standardized Income Tax Year
    3. Enhanced STAR - Income Verification
    4. Third Party Notices
    5. Hardship Filing Extensions
    6. Special Situations

  3. EXEMPTION ADMINISTRATION
    1. Economic Development
    2. Volunteer Firefighters and Ambulance Workers
    3. Residential Investment Exemption
    4. Solar or Wind Energy Pilot
    5. Agriculture Housing & Facilities
    6. Rail Infrastructure Investment Act 2002
    7. Nonprofit Exemptions

  4. GENERAL ADMINISTRATION
    1. City of Cohoes - Assessment Date
    2. Apportionment Dates
    3. Real Property Tax Review Proceeding - Abandonment
    4. Cooperative Apartment Corporation (STAR)
    5. Mortgage Investment Institutes
    6. Large Properties Apportionment
    7. Delivery of Tax Payments
    8. Correction of Clerical Errors

  5. SPECIAL ASSESSING UNITS - NYC & Nassau County
    1. Rehabilitation / Construction Exemptions
    2. Partial Abatement for Seniors (Nassau Co.)
    3. Assessment Review Process (Nassau Co.)

  6. OUTLOOK FOR 2003
    1. Assessment Practices - NYC
    2. Nassau Co. Re-evaluation
    3. Vacant Land - Special Assessing Units

  7. APPENDICES
    1. Appendix A: 2002 Summary
    2. Appendix B: RPT Bills Enacted
    3. Appendix C: RPT Bills That Passed Only the Assembly



I.   ASSESSORS CORRUPTION SCANDAL - NYC

New York City's real property assessment process has long been criticized for being archaic, complicated, and shrouded in secrecy. The realization that such a system also permitted some within its ranks to commit unethical and illegal behavior became public knowledge on February 25, 2002. On that date, eighteen members of the Real Property Assessing Unit of the New York City Department of Finance were indicted on criminal corruption charges (seventeen of them have since been convicted of those charges) ranging from mail fraud to bribery to racketeering. The crime, they accepted financial compensation in return for inappropriately reducing real property assessments. The cost to the city is immeasurable in terms of public confidence and lost revenue - estimated to be in the hundreds of millions.

With the backing and support of Speaker Sheldon Silver, the Committee immediately inquired into the facts surrounding the assessors' scandal, examined current assessment practices, and convened a public hearing. Our mission, to determine the best course of action to take to establish a fair and equitable real property tax system in New York City, to deter future incidences of illegal and unethical activity, and to restore the confidence of taxpayers and property owners.

With the insight we gained from our fact-finding missions and public hearing, the Committee offers the following legislative recommendations:

  • An independent assessor should be responsible for certifying the accuracy and completeness of the assessment roll;
  • Assessors should be required to file to financial disclosure as established by ethics laws;
  • Sales data for real property transaction should be available to the public;
  • Methods of valuation, including capitalization rates and other data used in determining assessments should be made available to property owners;
  • State reimbursement to New York City for maintaining updated assessment valuations and assessment rolls should be granted in full;
  • City assessors and assessing personnel should meet minimum qualification standards and should be certified as having the met education and training requirements;
  • State reimbursement should be available for assessor training courses;
  • New York City should have the authority to recover, by civil action, revenues lost as a result of criminal misconduct.

This year the Committee made a significant step forward in renovating the real property assessment process in New York City. Assemblyman James Brennan sponsored and pushed for passage of Assembly Bill 4683A. This legislation, Chapter 259, requires the county recording officer or other such agency in the City of New York to submit a certified record of all real property transfers to the appropriate assessing unit(s), the County division of the Office of Real Property Services, and the State Board. This record will provide officials and interested parties with accurate data stating the location of the property, the sale price (market value), and new ownership of said property. This information will be instrumental in determining if like properties are assessed in the same manner and if assessments are reflective of the current market values. [Refer to Real Property Law 333(1-e)(iv)]

In addition to the above noted provision, this legislation requires a fee of twenty-five dollars for every sales reporting form submitted [RPL 333(1-e)(iv)]. Eighty-eight percent of the revenue collected from these fees goes to New York State's Office for Real Property Services to be deposited into an account for improvements of real property tax administration. The municipality retains the remainder. (A. 4683A, Brennan)

Note: All other municipalities within the State of New York are required to produce this monthly record and impose the applicable fee. This statute simple requires the assessment procedures in New York City to be more in line with the rest of the State.




II.   SCHOOL TAX RELIEF (STAR) PROGRAM

Several new laws were enacted this year relating to the School Tax Relief (STAR) Exemption Program authorized by Section 425 of the Real Property Tax Law. These revisions are a direct reflection of the conscientious efforts made by members of the Assembly in acknowledging the concerns expressed by local administrative personnel, advocates, and concerned citizens. Specifically, Chapter 83 - Part E of the laws of 2002 (Budget Bill A.9760B/S.6258B), provides the following revisions to the STAR exemption program beginning with the 2003 final assessment rolls:

  1. Cost of Living Adjustment (COLA)
  2. Budget Bill A. 9760B provides for an annual cost-of-living adjustment to the income eligibility limit for the senior citizen enhanced STAR. The adjustment will be based on the applicable cost of living adjustment applied to Social Security benefits. For the 2002 rolls, the income limit will remain at $60,000, for 2003 the limit will increase to $62,100 (a 3.5% increase) and continue to be adjusted each year in accordance with the applicable COLA rate set forth by the United States Commissioner of Social Security. [Refer to RPTL 425(4)(b)].

    NOTE: To avoid potential errors or confusion, the New York State Office of Real Property Tax will be responsible for annually promulgating the Enhanced STAR income eligibility limit.

  3. Standardized Income Tax Year
  4. Prior to changes enacted this year, statute [RPTL 425(4)(b)] permitted senior homeowners to submit their "latest available (tax) return" for determining enhanced STAR eligibility. This perpetuated a disparity in eligibility, as some senior STAR exemptions were based on the previous tax year while others were based on the current tax filing.

    Starting with the assessment rolls to be completed in 2003, eligibility for the enhanced STAR exemption will be based on the 2001 income tax filings and for each ensuing year will be advanced by one year (i.e. 2004 will be based on 2002 income tax filings, 2005 on 2003 income tax filings, etc.). Thus, all applicants for the enhanced STAR exemption program are subject to a specific income eligibility "standard" eliminating any confusion and disparity for both taxpayers and tax assessing departments.

  5. Enhanced STAR - Income Verification Program (Simplified Renewal)
  6. Beginning with the 2003 assessment rolls, seniors who are re-applying for the enhanced STAR exemption may authorize the assessor to verify their income in subsequent years by from their State income tax returns. This change will eliminate the need for seniors to reapply annually for enhanced STAR.

    Seniors who opt in on this program will be sent a notice, at least sixty days prior to the taxable status date, advising them of the new income eligibility limits and reminding them that they must notify their assessor if there has been any change in their residency status or in the ownership of the home. Ultimately, it will be the responsibility of the assessor to verify that property owners retain eligibility for the enhanced STAR exemption. [Refer to RPTL 425(4)(b)]

  7. Third Party Notices
  8. There were two modifications to the STAR "third party notification" program. Most notable, the assessor will now be responsible for sending notices to the designated third parties; it will no longer be the responsibility of the school district as directed by previous statute. The second change is in conjunction with the new "Income Verification Program". If an eligible senior has opted to participate in this program, the designated third party will receive a notice only when the enhanced STAR exemption is at risk of being discontinued. [Refer to RPTL 425(5)(d)]

  9. Hardship Filing Extensions
  10. Prior to Chapter 83 of the Laws of 2002, all STAR applications had to be submitted to the assessor by the taxable status date. If the appropriate application and documentation were not received by this date, the property owner forfeited the STAR exemption for that year and would have to wait to reapply the following year. There were no exceptions.

    With the enactment of Chapter 83 of the Laws of 2002, property owners who are unable to file a STAR exemption application by the taxable status date, due to a hardship caused by a serious illness or death of an immediate family member, may now be granted additional filing time by their local assessor. However, even under these circumstances, the filing date cannot exceed the grievance hearings date as established by the local assessing unit. [Refer to RPTL 425(6)(e)]

  11. Special Situations
  12. The following three amendments were needed to address special circumstances that are within the spirit of the STAR program's original intention, but that might otherwise cause confusion and/or negate eligibility in the program.

    1. Generally, when a husband and wife own two or more homes, only one residence - the primary residence - is eligible for the STAR exemption. This year legislation has been enacted to permit a STAR exemption for two primary residences in instances where the husband and wife are legally separated and living apart. [Refer to RPTL 425(4-a)(a)].

    2. In situations where a parcel of land has two or more physically separate residences, a STAR exemption may apply to each dwelling if at least one of the owners maintains the home as their primary residence and if the dwelling would otherwise qualify for the exemption if assessed separately. [Refer to RPTL 425(4-a)(b)]

    NOTE: Only one STAR exemption may be applied to the land.

    3. When a primary residence is located within two or more municipalities and the owners meet all other eligibility requirements for the STAR exemption, each portion of the residence is eligible for the STAR exemption. Each municipality will be required to pro-rate the assessed value accordingly. [Refer to (RPTL 425(4-a)(c)]

    NOTE: This exemption is not applicable to land that is split by the boundary; the exemption only applies to the dwelling.

    **** In addition to the above noted amendments that were adopted through Chapter 83 of the Laws of 2002, there are two other notable changes to the STAR Program. Chapter 484 addresses cooperative apartment corporations and Chapter 383 enacts a partial abatement for low and moderate senior citizens residing in Nassau County. Please refer to the General Administration (Section III part E) and Special Assessing Units - New York City & Nassau (Section IV part C) for details.



III.   EXEMPTION ADMINISTRATION
  1. Economic Development
  2. Chapter 328 created a Residential-Commercial Urban Exemption (RESCUE) Program to allow cities with a population between fifty-thousand and one million (i.e. Albany, Buffalo, Mount Vernon, New Rochelle, Niagara Falls, Rochester, Schenectady, Syracuse, Utica, White Plains, and Yonkers) to offer a real property tax exemption to developers and building owners so as to encourage creative use of office, warehouse, manufacturing, and other retail buildings in underutilized downtown areas. An earlier similar program has been credited with aiding the revitalization and reconstruction of lower Manhattan in New York City. (A. 8823B, Higgins)

    Note: Chapter 343 was enacted to amend the effective date of the RESCUE Program; thereby eliminating the 180 day waiting period and making this program effective immediately upon enactment (August 6, 2002).

  3. Volunteer Firefighters and Ambulance Workers
  4. Chapters 428, 431, 432, 433, 435, 440, 450, and 459 provide at local option a partial real property tax exemption for members of incorporated volunteer fire companies, fire departments and incorporated volunteer ambulance services in the counties of Putman, Erie, Wyoming, Steuben, Dutchess, Nassau, Suffolk, and Oswego. The exemption would equal 10% of the assessed value, but cannot exceed the product of $3000 multiplied by the equalization rate for the assessing unit as computed by the State. The exemption only applies to taxes and special ad valorem levies, not to special assessments. In Putnam and Suffolk Counties, the option may be extended to school districts.

    Note: Rockland and Chautauqua Counties had similar legislation already enacted. (Refer to RPTL 466-a and 466-b)

  5. Residential Investment Exemption
  6. Chapter 470 (RPTL 485-h) authorizes cities with a population of more than 31,000 but less than 32,000 (i.e. City of Jamestown) to create a temporary partial real property tax exemption program for new construction. Specifically, this amendment provides a real property tax exemption for the first year of up to fifty percent of the increased assessed value that is attributed to new construction; for the next nine years, the real property tax exemption decreases by 5% (e.g. year 1 - 50%, year 2 - 45%, year 3 - 40, etc.). This residential investment exemption is a fundamental tool that enables the city to compete with surrounding suburban neighborhoods in attracting new residential construction. (A. 1818A, Parment)

  7. Solar or Wind Energy Pilot
  8. Chapter 608 authorizes a county, city, town, village, or school district to enter into a contract to accept payment in lieu of real property taxes on properties that include a solar or wind energy system. The exemption from real property taxes cannot exceed fifteen years. Payments in lieu of the property tax cannot exceed what the assessed tax payment would have been if applied. [Refer to RPTL 487(9)]

    This legislation is a direct response to the number of large windmill farms that have been constructed in New York State in recent years. Windmill farms are primarily used to generate power for commercial entities. This new statute provides an incentive for utility companies to continue to invest in this environmental friendly resource. (A. 9797, Magee)

  9. Agriculture Housing & Facilities
  10. Chapter 684 encourages agriculture entities to provide healthy and safe environments in which farm laborers can live. Specifically, Chapter 684 adds a new section 483-d to the RPTL providing a real property tax exemption from taxation, special ad valorem levies, and special assessments for farms, food processing labor camps, or commissaries (as defined in Article 7 of the Labor Law) and other structures used to improve the living and working conditions of farm laborers. To qualify the farms, food processing labor camps or commissaries must meet federal and state health, safety, and building code standards. Once the real property tax exemption is granted, the exemption will be continuous unless the agricultural entity fails to maintain the necessary federal and state standards, in which case the exemption will be discontinued. (A. 5166, Ortiz)

  11. Rail Infrastructure Investment Act of 2002
  12. Chapter 698 enacts the "Rail Infrastructure Investment Act of 2002". This Act provides rail services with an affective stimulus to promote industry efficiency, modernization, and economic growth. It simultaneously protects local communities, especially upstate communities, from drastic revenue reductions by replacing lost tax revenues with additional State aid. [A. 11680, Rules (Tokasz)]

    Highlights of the "Rail Infrastructure Investment Act of 2002" are as follows:

    a). a ten year real property tax exemption for intrastate railroads for approved capital projects which improve freight service or provide new or improved passenger service, by excluding the value of such investments from the calculations of subsequent railroad ceilings;

    b). allowances for depreciation for "grading" , "construction overhead" or other soft costs; and allows for increased depreciation for track of up to 90%, for up to 10 years, if standards of improved service are met, including increased levels of passenger service or freight service;

    c). procedures by which capital projects must be submitted and approved by the Commissioner of the Department of Transportation, in order to qualify for a 10-year exemption including substantial enhancements, construction of significant new facilities, or major renovations to expansion of existing components of railroad infrastructure;

    d). a structured "transitional adjustment" under which the state will make payments to local governments to offset revenue losses generated by this Act. Local governments will initially be held harmless from revenue loss for three years; thereafter the state will offset half the revenue loss for the next eight years.

  13. Nonprofit Exemptions
  14. Assessors in several jurisdictions were authorized to accept exemption applications after the applicable taxable status date on specific properties (34 in all) owned by named nonprofit organizations and certain other entities. In most cases, the entity acquired the property after the taxable status date, although in some instances the entity had title but failed to file the exemption application by the taxable status date. The chapters providing relief to nonprofit organizations are as follows:

    Chapter Owner
    181 North Amityville Housing Rehabilitation Association Inc.
    183 Bethel Temple, Inc.
    184 Faith Temple Church of God in Christ
    187 Deliverance Revival Center, Inc.
    188 Thornton-Donovan School
    198 Agape Fellowship Church
    224 Full Gospel Church of Island Park
    225 All Saints' Episcopal Church
    233 East Meadow Fire District
    234 Uniondale Public Library District
    258 Sesame Flyers International, Inc.
    274 Southern Baptist Church
    298 Priority One (USA Outreach)
    299 Congregation Aish Kodesh
    300 Chasidic Center of Nassau County
    301 Hands Across Long Island
    316 Congregation D'Chacidei Breslov
    319 International Baptist Center, Inc.
    323 Rosa Lee Young Childhood Center
    326 Congregation Lubavitch Chabad, Inc.
    342 Town of Milo (Yates County)
    354 Yeshiva Torah Mitzion
    361 Beis Hamedrash Sharei Tefilah
    364 Great Neck Center for Visual and Performing Arts, Inc.
    365 Garden City Park Fire District
    366 Mount Sinai Hospital
    370 Haitian Baptist Church of Westbury, Inc.
    371 Sephardic Congregation of the Five Towns
    372 Christ Episcopal Church
    378 Society of St. Vincent de Paul
    384 Great Neck Synagogue
    385 Chabad of Roslyn
    643 Town of Brookhaven
    671 Urban League of Long Island, Inc.


IV.   GENERAL ADMINISTRATION
  1. City of Cohoes - Assessment Date
  2. Chapter 128 authorizes the City Council of the City of Cohoes to adopt a local law or resolution to cancel the 2002 tentative assessment roll, requires the assessor to file a new assessment roll before July 31, 2002, and allows for local adoption of a new grievance procedure to be completed by the time the final roll is filed. (Refer to NYS Unconsolidated Laws)

    For the first time in approximately fifty years, the City of Cohoes finished an up-to-date real property assessment. This comprehensive reevaluation resulted in a substantial upward fluctuation of taxes for approximately 18% of the property owners/tax payer in the City of Cohoes. Therefore, in collaboration with the New York State Office of Real Property Services and other interested parties, it has been determined that additional time was needed to provide the assessing unit with the necessary tools and time to address concerns, implement any necessary adjustments associated with the recent assessment, and to provide property owners with adequate time to review their tax status and file a grievance if necessary. [A. 11694, Rules (Canestrari)]

  3. Apportionment Dates
  4. Chapter 158 changes the date - from September first to November first - by which counties must decide which procedure to use, assessed value (Title 1) or State equalization rates (Title 2), to apportion their real property taxes [RPTL 840(4)]. In addition, Chapter 158 affords certain school districts the option to apportion their tax levies on assessed value rather than State equalization rates.

    In the past, the September first date to opt in or withdraw from the Title 2 created problems when a county learned of new information, such as a settlement of a tax certiorari by a town. Such settlements often generate significant alterations to the tax apportionment calculations. Providing counties with an additional two months will grant officials the necessary time allotment to determine the best assessment method (Title 1 or 2), to use in order to sustain a fair and equitable tax roll.

    In addition, the enactment of this legislation provides school districts containing two or more cities or towns with the same option to use assessed values verses State equalization rates. This optional alternative assessment method will provide these school districts with the necessary assessment tools to ensure that like parcels in adjourning assessment units within the school district are valued at the same rate. (A. 10736, Stringer)

  5. Real Property Tax Review Proceeding - Abandonment
  6. Chapter 186 amends RPTL 718 to recalculate the time period when a certiorari proceeding is deemed abandoned. This applies to proceedings to review the assessment of any real property in New York City as well as property elsewhere in the State when such property is a one to three family dwelling, including residential condominiums, and certain land used in agricultural production. The four-year period is calculated from the last day to commence the proceeding instead of from the actual date that the proceeding is filed.

    For example, in New York City, a real estate tax review proceeding may be commenced by the filing and service of a petition within a five month period ending October 24th. Present law encourages taxpayers to maximize the duration of proceedings by filing the petition as close to the October 24th deadline as possible. As a result, County Clerks and the City Tax Commission are inundated with a heavy volume of new proceedings immediately preceding the October 24th deadline. By changing the date by which a proceeding is deemed abandoned from the fourth anniversary of commencement, to the fourth anniversary of the filing deadline, i.e. October 24th in New York City, taxpayers will lose their present incentive for delay in commencement. The logical result will be filings at earlier dates over a five-month span, thereby relieving the burden associated with a heavy volume of filings in a short period. [A. 8455, Rules (Norman)]

  7. Cooperative Apartment Corporation - STAR Exemption
  8. The STAR exemption for co-op owners is slightly different from a standard homeowner. The co-op owner(s) must apply for the exemption; however, the cooperative apartment corporation receives the lump sum real property tax credit, not the individual. This has led to confusion and concern for some co-op owners, as they have no documentation clarifying just how the STAR benefit is being passed onto them as the individual tenant-stockholder.

    Chapter 484 is in direct response to this issue. This new law requires cooperative apartment corporations to provide to each STAR eligible tenant-stockholder, a written statement detailing how their STAR exemption is being credited. The notice must be sent within sixty days after the corporation receives the exemption [Refer to RPTL 425(2)(k)(iii)].

    This new procedure will provide the individual co-op owner with the documentation they need to address concerns or discrepancies they may have with the cooperative apartment corporation implementation of their STAR exemption. [A. 8616A, Rules (Brodsky)]

  9. Mortgage Investment Institutes
  10. Chapter 520 establishes enforcement provisions [RPTL 953(8-a)] to encourage Mortgage Investment Institutes (MII) to comply with current statute which requires MIIs to notify property owners of their obligation to pay property taxes once a mortgage is satisfied [RPTL 953(8)].

    Effective immediately, any mortgage investment institution which fails to comply with the existing notification provisions of 953(8) will be financially responsible for interest or penalties charged to the former mortgagor by a taxing municipality, county, and/or delinquent tax enforcement agency for non-payment or late payment of real property taxes. This enforcement provisions is only applicable to the first taxable year following mortgage satisfaction. (A. 11278, DiNapoli)

  11. Large Properties Apportionment
  12. Chapter 556 creates an alternative apportionment method of assessing real property for counties to apply to towns which have a "designated large property" as defined by RPLT 847(2). This enables municipalities, to adjust inequities in tax assessments that may otherwise occur when a community has a high value property (e.g. utility company, manufacturing facility, research laboratory, etc.) that disproportionately distorts the real property tax base of the surrounding parcels.

    The use of an alternative apportionment method (equalization rate) is at the discretion of local officials. Each year the affected county and school district will be required to adopt a local resolution to opt in on the alternative apportionment method. Counties that wish to participate will be required to adopt a resolution no later than November first of each year while school district must adopt an annual resolution no less than ten days prior to the levy of taxes. (A. 10058A, Tonko)

  13. Delivery of Tax Payments
  14. Chapter 568 expands and clarifies the manner in which a tax payment can be submitted and acknowledged as received by the appropriate tax-collecting unit.

    Previously the New York State Law (RPTL 925) had only recognized the United States Postal Service (USPS) as the official delivery service for taxes by mail. Payments were considered received as of the date of the postmark. There were no provisions in statute for payments received with missing or illegible postmarks.

    With the enactment of Chapter 568, beginning January 1, 2003, the designated delivery service will be expanded to include all delivery services acknowledged by the Secretary of the Treasury of the United States (e.g. Federal Express, United Postal Service, Airborne Express, etc.). The postmark will continue to be the official recorded payment date; however, in cases where the postmark is missing or illegible, the payment will be considered received as of the date the tax-collecting unit received it. (Galef, A. 9775A)

  15. Correction of Clerical Errors
  16. Chapter 616 introduces new procedures for the correction of erroneous real property tax billings, (RPTL 553), streamlines the process for correcting clerical errors [RPTL 554(4)], and removes the financially burdensome requirement for taxpayers to pay incorrect real property tax bills when a correctable error has occurred (RPTL 556). [A. 11205, Rules (DelMonte)]

    Specifically, this new law authorizes:

    The Board of Assessment Review to act on a petition from the assessor at its second meeting, to correct a partial exemption entry on the preceding year's assessment roll on a parcel that was ineligible. Under prior law, a partial exemption that had been granted in error could only be corrected on the current assessment, but not once that assessment roll became a tax roll. This new provision should allow sufficient time for most if not all partial exemption inaccuracies to be discovered and rectified to ensure a more accurate apportionment of real property taxes;

    The county director of real property services is authorized upon his/her recommendation to correct a tax roll and/or bill or to issue a tax refund associated with a clerical error. The county director must also determine if said error(s) appears on the current assessment roll and take the necessary action to correct the error(s). This procedural change will eliminate the same error from occurring on future assessment rolls and increases efficiencies;

    The levying body will now be required to promptly refund or credit the taxpayer for the amount of the adjustment associated with such error. No longer will the taxpayer have to submit payment of the erroneous original tax bill and wait for a refund at a later date.



V.   SPECIAL ASSESSING UNITS - New York City & Nassau County
  1. Rehabilitation / Construction Exemption(s) (NYC)


    1. 421-a Tax Incentive Program (NYC)
    2. Section 421-a of the New York State Real Property Tax Law affords a real property tax credit for new construction of dwellings consisting of three or more family units.

      This tax abatement program was set to expire in December of 2002. Chapter 349 extends the provisions of RPTL 421-a until December 31, 2007; thereby, continuing efforts to encourage the growth of the housing market and diminish the existing housing shortage in New York City. [A. 11695, Rules (Rivera, P.)]

      Note: This bill was initiated and supported by the Office of the Mayor of New York City.

    3. 421-b Tax Incentive Program (NYC)
    4. Section 421-b of the New York State Real Property Tax Law affords a real property tax credit for private dwelling in the City of New York for the construction of new one or two family dwellings, the conversion of any building or structure to a private one or two family dwelling, and for the rehabilitation/construction on any building that is improved to the extent of 40% or more of the assessed value.

      This tax abatement was due to expire on June 30, 2002. Chapter 160 extends the provisions of RPTL 421-b for commencement of construction from July 1, 2002 to July 1, 2006, and for the completion of said construction from July 1, 2004 to July 1, 2008. This law abets continuing efforts to provide incentives for the creation and continuation of one and two family dwellings within the City of New York. [A. 11103, Rules (Stringer)]

      Note: This bill was initiated and supported by the Office of the Mayor of New York City.

    5. Single Room Occupancy (SRO) Program (NYC)
    6. The real property tax exemption for rehabilitation of single occupancy housing units (SRO) is due to "sunset" effective December 31, 2002 (RPTL 488-a). Chapter 330 will extend the date of this essential real property tax exemption until December 31, 2007.

      This program provides a tax credit for rehabilitation and improvement of items, such as boilers, elevators, windows, etc., and is vital to keeping housing units both safe and affordable for low-income residence and the entities that are responsible for their upkeep. (A. 9952, Stringer)

      Note: This bill was initiated and supported by the Office of the Mayor of New York City.

    7. J-51 Program (NYC)
    8. The J-51 Program, a real property tax exemption program that has been successful in promoting the upgrading and rehabilitation of housing in New York City since 1955, was due to expire as of June 1, 2003. Chapter 418 extends the J-51 Program from June 1, 2003 until June 1, 2007. In addition, this chapter extends the local authorities ability to extend enriched benefits to privately owned substantially rehabilitated or converted buildings when affordable housing is created in connection with a governmental subsidized loan or grant. [Refer to RPTL 489(1) & (6)], [A. 11693, Rules (Espaillat)]

      Note: This bill was initiated and supported by the Office of the Mayor of New York City.

  2. Partial Abatement for Seniors - Nassau County
  3. The County of Nassau has recently proposed to implement new refinancing procedures to eliminate debt that has occurred from bond financing to cover the expenses associated with certiorari refunds. It has been estimated that the new proposal will increase the average homeowner's real property tax bill by approximately $224.00 a year. In anticipation of this tax increase, representatives of the County of Nassau have sought to protect their most vulnerable citizens - the financially strapped senior - by providing an additional local tax credit.

    Chapter 383 authorizes the County of Nassau, at local option, to adopt a real property tax credit for low income seniors who qualify for the enhanced STAR exemption (RPTL 425-a). Under this provision, a homeowner who qualifies for the enhanced STAR exemption will automatically be granted an additional County real property tax credit (amount to be determined by the local legislative body). [A. 11634, Rules (Hooper)]

  4. Assessment Review Procedures - Nassau County
  5. Nassau County's Assessment Review Commission (ARC) receives an unprecedented number of assessment grievances each year. The shear volume of petitions combined with the limited time frame in which ARC has to address the grievances has led to a process that institutes inefficiency and that is costly to both the taxpayer and the County.

    Chapter 401 addresses this issue by substantially revising the assessment review procedures in Nassau County (RPTL 523-b). Specifically, two critical provisions within this new statute will eliminate inefficiencies within ARC. First, it grants additional time to review grievances before the assessment roll becomes final and secondly, provides sufficient information with their grievance to allow for an informed decision by ARC. [A. 11478, Rules (DiNapoli)]



VI.   OUTLOOK FOR 2003

The Real Property Tax Committee will deal with many diverse and demanding issues in the 2003 legislative session. Initially, the Committee will be actively involved in the budget process as it pertains to the Office of Real Property Services a real property tax administration.

Three primary issues will be reviewed during 2003:

  1. Assessment Practices - NYC
  2. The assessor corruption scandal that rocked New York City's Finance Department in February of 2002 will continue to be a major concern for the Committee. We will continue to push for legislation and/or regulations that will deter future misuse of the system by entrusted officials.

  3. Nassau County Re-evaluation
  4. The assessment values for real property in Nassau County have not been fully re-evaluated since the 1930's. In 2002, in conjunction with new assessment procedures, Nassau County finally implemented a full reevaluation of its real property assessments. This data will be used for the 2003 tax rolls.

    To ensure that the property owners in Nassau County are protected against excessive real property tax fluctuations, the Committee will monitor the situation and in consultation with ORPS make recommendations and/or introduce legislation as necessary. The re-evaluation process may require legislative mitigation to avoid unnecessary economic displacement of property owners.

  5. Vacant Land - Special Assessing Units (Nassau County)
  6. Currently "vacant" land in "special assessing units" that are not in a city are classified as non-residential. This classification results in vacant land being taxed as if it were commercial property, even when said property may be zoned as residential (RPTL 1802). Often the commercial rate is upward of three times that of the residential rate. Nassau County officials have questioned this practice citing the undo tax burden it places on homeowners who use adjacent properties for personal use, such as vegetable and flower gardens. The Committee is reviewing this issue to determine the best course of action to take to resolve this dilemma in a fair and equitable manner.



APPENDIX A

2002 SUMMARY OF ACTION ON ALL BILLS REFERED TO THE REAL PROPERTY TAXATION COMMITTEE


FINAL DISPOSITON OF BILLS ASSEMBLY BILLS SENATE BILLS TOTAL
Total Referred to Committee 335 39 372
Bill Reported - 133 0 133
To Floor
0 0 0
To Ways and Means
127 0 127
To Codes
6 0 6
To Rules
0 0 0
To Judiciary
0 0 0
Bills Having Enacting Clauses Stricken 6 0 6
Bill Having Committee References Changed 4 0 4
To Aging
0 0 0
To Ways and Means
1 0 1
To Cities
1 0 1
To Veterans Affairs
2 0 2
Senate Bills Substituted   28 28
Senate Bill Recalled   1 1
Bills Held for Consideration 192 0 0
# of Bills Signed into Law 64    
# of Committee Meetings Held = 9



APPENDIX B

REAL PROPERTY TAXATION BILLS THAT BECAME LAW


Assembly Number Assembly Sponsor Chapter
#  
Description
1818A Parment 470 Authorizes the assessor of a city of not less than thirty-one thousand and not more than thirty two thousand (i.e. City of Jamestown) to enact a partial and limited real property tax exemption for construction on residential properties.
3672C Perry 258 Authorizes The City of New York to accept a real property tax exemption application from the Sesame Flyers International, Inc.
3831A Manning 435 Authorizes local municipalities in counties with a population of more than two hundred fifty-eight thousand inhabitant but less than three hundred fifty-eight thousand two hundred inhabitants (i.e. Dutchess County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
4671A Stephens 428 Authorizes local municipalities in counties with a population of more than ninety-five thousand inhabitants but less than ninety-six thousand inhabitants (i.e. Putnam County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
4683 Brennan 259 Extends to New York City the requirement to file a sales reporting form (RP-5217) when recording a deed.
4955A Sweeney 181 Authorizes the Town of Babylon to accept a real property tax exemption application from the North Amityville Housing Rehabilitation Association Inc.
5166 Ortiz 684 Provides a real property tax exemption for farm or food processing labor camps, commissaries, and other farm worker related structures, if the improvements comply with certain state and federal standards.
6228C Burling 432 Authorizes local municipalities in counties with a population of more than forty-three thousand four hundred inhabitants but less than forty-three thousand six hundred inhabitants (i.e. Wyoming County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
6695B Bacalles 433 Authorizes local municipalities in counties with a population of more than ninety-eight thousand seven hundred inhabitants but less than ninety-nine thousand inhabitants (i.e. Steuben County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
7128C Pretlow 183 Authorizes the City of Mt. Vernon to accept a real property tax exemption application from Bethel Temple, Inc.
7131A Wirth 431 Authorizes local municipalities in counties with a population of more than nine hundred fifty thousand inhabitants but less than nine hundred sixty thousand inhabitants (i.e. Erie County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
7289A Sweeney 184 Authorizes the County of Suffolk to accept from the Faith Temple Church of God in Christ a real property tax exemption application and further permits Suffolk County to reconvey its interest in certain real property acquired by in rem foreclosure from the Faith Temple Church of God in Christ.
8455 (Rules) Norman 186 Provides a uniform date by which real estate tax review proceedings are to be deemed abandoned.
8616A (Rules) Brodsky 484 Requires cooperative apartment corporation to provide to each STAR eligible tenant-stockholder a written statement detailing how the exemption is being credited no later than sixty days after the corporation receives the exemption.
8823B (Rules) Higgins 328 Authorizes municipalities to offer property tax exemptions to developers and building owners to convert office space and properties formerly housing warehouse, manufacturing and retail activities, to residential housing units and commercial mixed uses in downtown areas of Buffalo, Niagara Falls, Rochester, Syracuse and other municipalities with a population of 50,000 to one million.
9426 (Rules) Hooper 187 Authorizes the Assessors of the County of Nassau and the Village of Hempstead to accept a real property tax exemption application from Deliverance Revival Center, Inc.
9585 Colman 361 Amends Chapter 256 of 2001 in relation to a nonprofit exemption for Beis Hamedrash Sharei Tefilah in the Town of Ramapo.
9647 DiNapoli 364 Authorizes the assessor of the County of Nassau to accept a nonprofit real property tax exemption application from Great Neck for the Visual and Performing Arts, Inc.
9702A Sidikman 440 Authorizes local municipalities in counties with a population of more than one million three hundred thousand inhabitants but less than one million four hundred thousand inhabitants (i.e. Nassau County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
9770 Tocci 188 Authorizes the assessor of the City of New Rochelle to accept an application for a real property tax exemption from Thornton-Donovan School.
9775 Galef 568 Eases the payment of property taxes by clarifying the acceptable proof of the date on which tax payments were sent to the appropriate collecting officer.
9797 Magee 608 Authorizes a county, city, town, village, or school district to enter into a contract to accept payment in lieu of real property taxes on properties that include a solar or wind energy system.
9816A Gianaris 366 Authorizes the assessor of the City of New York to accept an application for a real property tax exemption from Mount Sinai Hospital.
9877 O'Connell 365 Authorizes the assessor of the County of Nassau to accept a real property tax exemption application from the Garden City Park Fire District.
9952 Stringer 330 Authorizes New York City to extend the date by which not-for-profit and for profit owners rehabilitating single room occupancy housing (SRO) are eligible to receive tax benefits.
10058A Tonko 556 Provides an optional alternative method for apportioning taxes by school districts and counties which contain a "designated large property", in order to mitigate the influence such properties may have upon the apportionment process.
10096 Thiele 372 Authorizes the assessor of the Town of Southampton to accept a nonprofit real property tax exemption application from Christ Episcopal Church.
10132 Barra 298 Authorizes the assessors of the Village of Valley Stream and County of Nassau to accept a nonprofit real property tax exemption application from Priority One.
10133 Barra 225 Authorizes the assessor of the County of Nassau to accept a nonprofit real property tax exemption application from the All Saints' Episcopal Church.
10135A Weisenberg 299 Authorizes the assessor of the County of Nassau to accept a nonprofit real property tax exemption application from the Congregation Aish Kodesh.
10136 Weisenberg 300 Authorizes the assessor of the County of Nassau to accept a nonprofit real property tax exemption application from the Chasidic Center of Nassau County.
10137 Weisenberg 371 Authorizes the assessors of the Village of Cedarhurst and the County of Nassau to accept a nonprofit real property tax exemption application from the Sephardic Congregation of the Five Towns.
10278 Levy 301 Authorizes the assessor of the Town of Islip to accept a nonprofit real property tax exemption application from Hands Across Long Island.
10279 Levy 671 Authorizes the assessor of the Town of Islip to accept a nonprofit real property tax exemption application from the Urban League of Long Island, Inc.
10316 McDonough 354 Authorizes the assessor of the County of Nassau to accept a nonprofit real property tax exemption application from Yeshiva Torah Mitzion.
10473 McDonough 224 Authorizes the assessor of the County of Nassau to accept a nonprofit real property tax exemption application from the Full Gospel Church of Island Park.
10587A Ferrara 233 Authorizes the assessor of the County of Nassau to accept a real property tax exemption from the East Meadow Fire District.
10672A Levy 450 Authorizes local municipalities in counties with a population of more than one million four hundred thousand inhabitants but less than one million five hundred thousand inhabitants (i.e. Suffolk County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
10678A Stringer 335 Rescinds the duty of the Department of Taxation and Finance to enforce property tax liens that arose between 1924 and 1926 in six counties (Delaware, Greene, Herkimer, Saratoga, Sullivan, and Ulster).
10736 Stringer 158 Changes the date by which counties must decide which procedure is used to apportion taxes from September 1 to November 1 and expands the possibility for school districts to apportion taxes based on assessed value rather than by using State equalization rates.
10940 Sullivan, F 59 Authorizes local municipalities in counties with a population of more than one hundred twenty thousand but less than one hundred forty one thousand (i.e. Oswego County) to adopt local legislation that provides a 10% real property tax exemption (not to exceed $3000 times the latest State equalization rate) for volunteer firefighters and ambulance workers residing in such municipalities.
11103 (Rules) Stringer 160 Extends the exemption program for owner occupied one or two family dwellings in New York City that are newly constructed, reconstructed, or converted to a private dwelling.
11122 (Rules) Sidikman 370 Authorizes the assessor of Nassau County to accept a nonprofit real property tax exemption application from the Haitian Baptist Church of Westbury, Inc.
11205 (Rules) DelMonte 616 Provides simplification in correcting clerical mistakes, errors related to partial exemptions, and remittance of tax payments associated with said errors.
11278 (Rules) DiNapoli 520 Holds mortgage investment institutions (MII) responsible for any penalties, fees, or late charges resulting from the termination of a real property escrow account if upon satisfying the mortgage, the MII fails to notify the property owner of their obligation to now pay real property taxes.
11334 (Rules) Hikind 316 Authorizes the assessor of Kings County to accept a nonprofit real property tax exemption application from the Congregation D'Chacidei Breslov.
11421 (Rules) Flanagan 378 Authorizes the assessor of the Town of Huntington to accept a nonprofit real property tax exemption application from the Society of St. Vincent de Paul.
11505 (Rules) Gordon 198 Authorizes the Commissioner of New York City to accept a nonprofit real property tax exemption application from the Agape Fellowship Church.
11507 (Rules) Kolb 342 Authorizes the assessor of the Town of Milo to accept a real property tax exemption application from the Town of Milo (Yates County).
11519A (Rules) DiNapoli 384 Authorizes the assessor for County of Nassau to accept a nonprofit real property tax exemption application from the Great Neck Synagogue.
11522 (Rules) Higgins 343 Revises the effective date of Chapter 328 of 2002, which establishes the residential-commercial urban exemption program, to immediately upon enactment from the one hundred and eighty day inception requirement.
11545 (Rules) Gordon 274 Authorizes the assessor of the New York City Department of Finance to accept a nonprofit real property tax exemption application from the Southern Baptist Church.
11560 (Rules) Abbate 319 Authorizes the assessor of the New York City Department of Finance to accept a nonprofit real property tax exemption application from the International Baptist Church, Inc.
11592 (Rules) Barra 323 Authorizes the assessors of the Village of Rockville Center and Nassau County to accept a nonprofit real property tax exemption application from Rosa Lee Young Childhood Center, Inc.
11593 (Rules) O'Connell 234 Authorizes the assessor of Nassau County to accept a real property tax exemption application from the Uniondale Public Library.
11603 (Rules) Conte 326 Authorizes the assessor of the Town of Huntington to accept a nonprofit real property tax exemption application from Congregation Lubavitch Chabad, Inc.
11634A (Rules) Hooper 383 Authorizes at local option an additional partial abatement of general county taxes for low and moderate-income senior citizens in Nassau County who qualify for Enhanced Star.
11636 (Rules) Englebright 643 Provides that certain real property located in the town of Brookhaven shall be removed from assessment rolls upon transfer of title to such property to such town.
11640 (Rules) DiNapoli 385 Authorizes the assessor of Nassau County to accept a nonprofit real property tax exemption application from Chabad of Roslyn.
11680 (Rules) Tokasz 698 Enacts the "New York State Rail Infrastructure Investment Act of 2002"; provides for railroad real property tax exemptions and the calculation of railroad ceilings for new construction projects; makes new provisions for capital improvements to railroad property; also provides for state assistance to municipal corporations (including school districts) and special districts.
11693 (Rules) Espaillat 418 Extends the from June 1, 2003 until June 1, 2007 the deadline for local legislative action providing tax incentives for the rehabilitation and upgrading of multiple dwellings exemption program for owner occupied one or two family dwellings in New York City that are newly constructed, reconstructed, or converted to a private dwelling (known as the NYC J-51 Program).
11694 (Rules) Canestrari 128 Authorizes the City of Cohoes to cancel the current tentative assessment roll and to establish a new date for filing the tentative roll by no later than June 30, 2002 and provides a new grievance process.
11695 (Rules) Rivera, P. 349 Extends the period in which construction on certain multiple dwellings in New York City must begin construction in order to qualify for partial real property tax exemptions (from 12/31/03 to 12/31/07).
11748 (Rules) DiNapoli 401 Revises the processes for the assessment of real property, preparation of tax rolls, changes in assessments, and review of assessments in the County of Nassau.



APPENDIX C

REAL PROPERTY TAXATION BILLS THAT PASSED THE ASSEMBLY ONLY


Assembly Number Assembly Sponsor Description
5736 Colman Requires counties to permit indigent seniors, ages sixty-five and older, to consult with an attorney prior to taking their property for nonpayment of delinquent taxes.
6401 Sweeney Authorizes towns and/or counties to accept real property taxes in the year before they are levied.
8409 Rules (Espaillat) Authorizes the State Board of Real Property Services to provide counties with tentative state equalization rates for use in the apportionment of real property taxes for school and county purposes; further provides for adjustments of such tentative rates to be made in the next tax levy if the rate differs from a final rate.
8910 Rules (Brennan) Sets forth certain mandates for the administration of the New York City "STAR" program and further establishes provisions for creating a STAR outreach program in the City of New York.
9906 O'Connell Authorizes the assessor of Nassau County to accept a nonprofit real property tax exemption application from the Holy Trinity Baptist Church.
10266 Magee Requires a copy of an application for real property tax exemption solar or wind energy systems be sent to the school districts in which the exemption would affect.
10679 Stringer Provides that oil and gas rights and other elements of economic units shall be exempt from taxation if the oil and gas which are subject to those rights originate from landfills; provides that such exemption shall apply to eligible property on assessment rolls based on taxable status dates occurring on or before December thirty-first, two thousand seven.
10700 Powell Increases the income eligibility limit from $20,000 to $30,000 for tax abatements on rent controlled and rent regulated properties occupied by senior citizens (SCRIE program).
11091 Rules (Sweeney) Amends the First Time Homebuyers Law of 2001, to ensure that the purchase price limit mirrors the SONYMA guidelines.
11349 Rules (Hikind) Authorizes the New York City Department of Finance to accept a nonprofit real property tax exemption application from Bais Yaakov D'Chassidei Gur.
11404 Rules (Stringer) Requires disclosure of assessment method in NYC certiorari proceeding.
11405 Rules (Stringer) Modifies the cap on State assessment aid for maintaining up-to-date real property assessment rolls in cities of one million or more inhabitants.
11406 Rules (Stringer) Establishes the Office of Chief Assessor in New York City and requires certification, continuing education, and training of all NYC assessors.
11407 Rules (Stringer) Requires every New York State assessor and personnel assigned to assessing duties to file an annual statement of financial disclosure.


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