A04314 Summary:

BILL NO    A04314 

SAME AS    No same as 

SPONSOR    Brennan

COSPNSR    

MLTSPNSR   

Amd S420-c, RPT L

Exempts certain low income housing accommodations from local real property
taxation in a city with a population of one million or more.
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A04314 Actions:

BILL NO    A04314 

01/30/2015 referred to real property taxation
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A04314 Votes:

There are no votes for this bill in this legislative session.
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A04314 Memo:

BILL NUMBER:A4314

TITLE OF BILL:  An act to amend the real property tax law, in relation
to exemptions from local real property taxation of certain low income
housing accommodations in a city with a population of one million or
more

PURPOSE OR GENERAL IDEA OF BILL:

This bill amends the New York State Real Property Tax Law section
420-c to (1) allow tax exemptions for only those entities where the
non-profit has 51% control, instead of 50% control as is written in
current law and (2) limit the entities eligible for real property tax
exemption to exclude those that are established by a for-profit entity
or are a subsidiary of a for-profit corporation, partnerships or
limited liability company.

JUSTIFICATION:

The current real property tax law specifies four criteria for tax the
real property tax exemption: (1) the entity must be organized to
provide housing to low-income people, and hold a 501c(3) or 501c(4)
exemption; (2) the project must receive Low-Income Housing
Tax-Credits; (3) the project must have a regulatory agreement with a
government entity, and the agreement must indicate that at least 70%
of the units are restricted to 60% AMI or lower, and (4) the project
must have taken out a loan from a government entity.

Under the current statute, for-profit developers are able to set up
non-profits that are owned and controlled by the for-profit for the
purpose of qualifying for the 420-c benefit. Further, under existing
law, a non-profit must only have 50% of control of an entity in order
to qualify for the abatement, often leaving the non-profit with no
oversight control of the Joint Venture Agreements.

The property tax abatement, when limited only to non-profit
development corporations, allows for Community Development
Corporations to submit more competitive bids and lower operating
costs, providing greater benefits to the community. When limited only
to non-profit developers, CDC's are better able to compete, greatly
improving the overall quality of low-income housing in the city.

PRIOR LEGISLATIVE HISTORY:

A10660 of 2012 - In Real Property Tax

EFFECTIVE DATE:

Immediately
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A04314 Text:

                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________

                                         4314

                              2015-2016 Regular Sessions

                                 I N  A S S E M B L Y

                                   January 30, 2015
                                      ___________

       Introduced  by M. of A. BRENNAN -- read once and referred to the Commit-
         tee on Real Property Taxation

       AN ACT to amend the real property tax law,  in  relation  to  exemptions
         from local real property taxation of certain low income housing accom-
         modations in a city with a population of one million or more

         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:

    1    Section 1. Subdivision 1 of section 420-c of  the  real  property  tax
    2  law,  as  amended by chapter 104 of the laws of 1999, is amended to read
    3  as follows:
    4    1. In a city having a population of one million or more, real property
    5  owned by a corporation, partnership or limited liability company  formed
    6  for  the  purpose  of  providing  housing accommodations for persons and
    7  families of low income as defined in section two of the private  housing
    8  finance  law  and used for such purpose, shall be exempt from local real
    9  property taxation, provided that such corporation, partnership or limit-
   10  ed liability company: (a) is organized as a non-profit housing  develop-
   11  ment  fund  company  pursuant  to  article eleven of the private housing
   12  finance law AND IS NOT ESTABLISHED OR CONTROLLED BY A FOR-PROFIT ENTITY,
   13  or is a non-profit housing corporation as defined in article  eleven  of
   14  the  private  housing finance law which is not incorporated as a housing
   15  development fund company as defined in article  eleven  of  the  private
   16  housing finance law AND IS NOT ESTABLISHED OR CONTROLLED BY A FOR-PROFIT
   17  ENTITY,  or is a wholly-owned subsidiary of such a company or is a part-
   18  nership or limited liability company the controlling interest  of  which
   19  is held by such a company or corporation or by a wholly owned subsidiary
   20  of  such  a  company  or  by a corporation sponsored or formed by such a
   21  company or corporation; and (b) has received a loan from a municipality,
   22  the state or the housing trust fund corporation established pursuant  to
   23  section forty-five-a of the private housing finance law or any successor
   24  corporation; and (c) enters into a regulatory agreement with the munici-

        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD02450-01-5
       A. 4314                             2

    1  pality,  the  state  or  the  housing trust fund corporation established
    2  pursuant to section forty-five-a of the private housing finance  law  or
    3  any successor corporation guaranteeing the provision of housing accommo-
    4  dations for persons and families of low income; and (d) is a participant
    5  in  the federal low income housing tax credit program established pursu-
    6  ant to section forty-two  of  the  internal  revenue  code  of  nineteen
    7  hundred  eighty-six,  as amended. Any exemption pursuant to this section
    8  shall expire upon the expiration or termination of the regulatory agree-
    9  ment.
   10    S 2. Subparagraphs 4 and 5  of  paragraph  (a)  of  subdivision  4  of
   11  section  420-c  of the real property tax law, subparagraph 4 as added by
   12  chapter 522 of the laws of 2004 and subparagraph 5 as amended by chapter
   13  526 of the laws of 2004, are amended to read as follows:
   14    (4) The term "charitable organization" shall mean (i) an  entity,  NOT
   15  ESTABLISHED  OR  CONTROLLED  BY A FOR-PROFIT ENTITY, formed for purposes
   16  that include providing housing accommodations for persons  and  families
   17  of  low  income  and  that has received written recognition of exemption
   18  pursuant to section 501(c)(3)  or  section  501(c)(4)  of  the  internal
   19  revenue  code of nineteen hundred eighty-six, as amended, or any succes-
   20  sor statute, from the United States Internal  Revenue  Service,  or  any
   21  successor  agency, or (ii) a corporation, partnership or limited liabil-
   22  ity company wholly owned and wholly controlled by an entity, NOT  ESTAB-
   23  LISHED  OR  CONTROLLED  BY A FOR-PROFIT ENTITY, formed for purposes that
   24  include providing housing accommodations for persons and families of low
   25  income and that has received written recognition of  exemption  pursuant
   26  to  section  501(c)(3) or section 501(c)(4) of the internal revenue code
   27  of nineteen hundred eighty-six, as amended, or  any  successor  statute,
   28  from  the United States Internal Revenue Service, or any successor agen-
   29  cy.
   30    (5) The term "eligible entity" shall mean a  corporation,  partnership
   31  or  limited  liability company at least [fifty] FIFTY-ONE percent of the
   32  controlling interest of which is held by a charitable organization.
   33    S 3. This act shall take effect immediately and  shall  apply  to  all
   34  projects  approved  on  or  after  the date on which this act shall have
   35  become a law.
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