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A07456 Summary:

BILL NOA07456
 
SAME ASNo Same As
 
SPONSORTitone
 
COSPNSR
 
MLTSPNSR
 
 
Confirms eligibility for and directs the New York city department of finance to provide exemption from taxation for certain residential dwelling units in the county of Richmond; provides that the exemption benefits shall be based upon all increases in assessed valuation, whether they are physical or equalization increases; sets forth the annual exemption benefits; provides that all exemption benefits prior to the current tax year shall result in credits to be applied to future taxes; provides that an extension may be granted for completion of the subject projects up to 96 months but no later than December 31, 2019.
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A07456 Actions:

BILL NOA07456
 
04/26/2017referred to real property taxation
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A07456 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A7456
 
SPONSOR: Titone
  TITLE OF BILL: An act to confirm eligibility for and direct the New York city department of finance to provide exemption from taxation of certain residential dwelling units in the county of Richmond   PURPOSE OR GENERAL IDEA OF BILL: Confirms eligibility for and directs the New York City department of finance to provide exemption from taxation of certain residential dwell- ing units   SUMMARY OF PROVISIONS: Section 1 confirms eligibility for J-51 exemptions and abatements for eight class A multiple dwellings comprised of more than 1,100 units and occupied exclusively by low-income tenants receiving benefits under Section 8, where certificates of eligibility for moderate rehabilitation with enriched benefits were issued by the New York City HPD on July 28, 2000 and January 30, 2002. Provides the standard 5-year graduated phase out of benefits at the end of the 34-year terms of eligibility for each project. Further provides that exemption benefits shall be based upon all increases in the buildings' assessed valuation, without regard to whether such increase was the result of physical or equalization increases, and that any exemption benefits created by this act for previous tax years shall result in the creation of credits to reduce taxes for the remainder of the benefit period. Section 2 provides that this act shall take effect immediately   DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION (IF APPLICABLE): N/A   JUSTIFICATION: The J-51 Program provides an incentive in the form of real estate tax exemption(s) and/or abatement(s) to property owners who either rehabili- tate existing multiple dwellings or convert other buildings to multiple dwellings to promote the creation and preservation of affordable housing in the city of New York. Parkhill I and II and St. George Plaza are an 8-building complex in Staten Island containing 1,118 HUD Section 8 low-income dwelling units. The buildings are restricted to serving only "very low income" tenants and limited in the amount of profit that may be distributed to building owners by a user agreement in effect until April 2063. That agreement requires any excess, including recovered tax benefits, to be deposited in a HUD-controlled residual receipts account used to fund repairs, maintenance and upkeep of the properties. In 1997 and 1998, the owners made approximately $11 million in govern- ment funded renovations to the properties, which qualified the proper- ties for enriched real estate tax benefits under the J-51 program. Despite the issuance of Certificates of Eligibility in 2000 and 2002, and the full compliance of building owners with the terms of the J-51 program, the properties have not received the benefits to which they are entitled, and their assessments have increased by more than 400%. The loss of the promised tax benefit (approximately $8 million over the previous 4 years) has resulted in monies being diverted from the reserve accounts that are otherwise used to fund repairs, maintenance and upkeep of the properties. The property owners have also had to cut funding for community-based activities and manned security at the properties, which threatens to result in deterioration and increased crime at this large, low-income complex. This legislation is necessary to remedy this inequity, promote invest- ment in affordable housing and ensure that residents receive the services they need for a safe and secure community.   PRIOR LEGISLATIVE HISTORY: (2011-2012)A.8271 Referred to Cities (2013-2014)A 5211 Referred to Cities (2015-2016)A 3161 Referred to Cities   FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None to the state.   EFFECTIVE DATE: This act shall take effect immediately.
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A07456 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          7456
 
                               2017-2018 Regular Sessions
 
                   IN ASSEMBLY
 
                                     April 26, 2017
                                       ___________
 
        Introduced by M. of A. TITONE -- read once and referred to the Committee
          on Real Property Taxation
 
        AN  ACT  to confirm eligibility for and direct the New York city depart-
          ment of finance to provide exemption from taxation of certain residen-
          tial dwelling units in the county of Richmond

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  1.  Notwithstanding  any  law,  rule or regulation to the
     2  contrary, where certificates of eligibility for moderate  rehabilitation
     3  with  enriched  benefits  were issued by the New York city department of
     4  housing preservation and development on July 28, 2000  and  January  30,
     5  2002  for alterations and improvements constructed between 1997 and 2000
     6  with regard to a group of eight class A multiple dwellings reflected  on
     7  three separate tax lots, comprised of eleven hundred or more residential
     8  rental  units  located  on  the same residential street in the county of
     9  Richmond, exclusively occupied by low income tenants receiving  benefits
    10  under  section  8 of the United States housing act of 1937 whose incomes
    11  do not exceed 50 percent of the area median income, which are subject to
    12  a 50-year use agreement pursuant to the United States low-income housing
    13  preservation and resident homeownership act of 1990  and  funded  by  at
    14  least  10  million dollars of federal subsidies, each such tax lot shall
    15  be exempt from taxation for local purposes for 34  years  under  section
    16  489  of  the real property tax law and section 11-243 of the administra-
    17  tive code of the city of New York.  The  New  York  city  department  of
    18  finance  is  hereby  directed  to  comply  with  the  provisions of this
    19  section.
    20    2. For tax lots  granted  benefits  under  this  section  pursuant  to
    21  certificates  of eligibility issued on July 28, 2000, exemption benefits
    22  shall be based upon all increases in the buildings  assessed  valuation,
    23  without  regard to whether such increases were the result of physical or
    24  equalization increases, as follows:
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD11044-01-7

        A. 7456                             2
 
     1    (a) beginning in tax year 2001-2002 and ending at  the  completion  of
     2  tax  year  2034-2035,  the  exemption benefit shall equal the difference
     3  between the building assessed value for  that  tax  year  and  tax  year
     4  1997-1998 multiplied by the then current overall class 2 tax rate;
     5    (b)  for  tax year 2035-2036, the exemption benefit shall equal eighty
     6  percent of the difference between the  then  current  building  assessed
     7  value  and  the building assessed value in tax year 2001-2002 multiplied
     8  by the then current class 2 tax rate;
     9    (c) for tax year 2036-2037, the exemption benefit  shall  equal  sixty
    10  percent  of  the  difference  between the then current building assessed
    11  value and the building assessed value in tax year  2001-2002  multiplied
    12  by the then current class 2 tax rate;
    13    (d)  for  tax  year 2037-2038, the exemption benefit shall equal forty
    14  percent of the difference between the  then  current  building  assessed
    15  value  and  the building assessed value in tax year 2001-2002 multiplied
    16  by the then current class 2 tax rate;
    17    (e) for tax year 2038-2039, the exemption benefit shall  equal  twenty
    18  percent  of  the  difference  between the then current building assessed
    19  value and the building assessed value in tax year  2001-2002  multiplied
    20  by the then current class 2 tax rate.
    21    3.  For  tax  lots  granted  benefits  under  this section pursuant to
    22  certificates of eligibility issued on January 30, 2002, exemption  bene-
    23  fits  shall  be based upon all increases in the buildings assessed valu-
    24  ation, without regard to whether such increases were the result of phys-
    25  ical or equalization increases, as follows:
    26    (a) beginning in tax year 2002-2003 and ending at  the  completion  of
    27  tax  year  2035-2036,  the  exemption benefit shall equal the difference
    28  between the building assessed value for  that  tax  year  and  tax  year
    29  1998-1999 multiplied by the then current overall class 2 tax rate;
    30    (b)  for  tax year 2036-2037, the exemption benefit shall equal eighty
    31  percent of the difference between the  then  current  building  assessed
    32  value  and  the building assessed value in tax year 2002-2003 multiplied
    33  by the then current class 2 tax rate;
    34    (c) for tax year 2037-2038, the exemption benefit  shall  equal  sixty
    35  percent  of  the  difference  between the then current building assessed
    36  value and the building assessed value in tax year  2002-2003  multiplied
    37  by the then current class 2 tax rate;
    38    (d)  for  tax  year 2038-2039, the exemption benefit shall equal forty
    39  percent of the difference between the  then  current  building  assessed
    40  value  and  the building assessed value in tax year 2002-2003 multiplied
    41  by the then current class 2 tax rate;
    42    (e) for tax year 2039-2040, the exemption benefit shall  equal  twenty
    43  percent  of  the  difference  between the then current building assessed
    44  value and the building assessed value in tax year  2002-2003  multiplied
    45  by the then current class 2 tax rate.
    46    4.  For  all  tax  years prior to the tax year in which this act takes
    47  effect, all exemption benefits created pursuant to subdivisions two  and
    48  three of this section shall result in the creation of credits. The total
    49  of  all  credits  for  tax years prior to the tax year in which this act
    50  takes effect shall be applied by the New York city department of finance
    51  to reduce taxes for the remainder of the benefit  period,  beginning  in
    52  the  first  tax  year  in  which  this act takes effect through tax year
    53  2039-2040.
    54    5. The New York city department of housing preservation  and  develop-
    55  ment  is  hereby  empowered  to  grant  an  extension  of  the period of
    56  completion for any project described in subdivision one of this section,

        A. 7456                             3
 
     1  where construction commenced in 2011, if such  alterations  or  improve-
     2  ments  are completed within 96 months from commencement of construction;
     3  provided that such conversion, alterations or improvements shall in  any
     4  event be completed prior to December 31, 2019.
     5    § 2. This act shall take effect immediately.
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