Provides for the assessment of real property in cities having a population of one million or more, which was damaged by a severe storm on October 29 - 30, 2012.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5620B
SPONSOR: Goldfeder TITLE OF BILL: An act to amend the real property tax law, in relation
to the assessment of real property damaged by the severe storm that
occurred on the twenty-ninth and thirtieth of October, 2012 in a city
having a population of one million or more
PURPOSE: This legislation provides for the assessment of real proper-
ty in cities having a population of one million or more, which was
damaged by Hurricane Sandy.
SUMMARY OF PROVISIONS:
Section one of this bill adds a new section 1805-a to the Real Property
Tax Law to authorize New York City to limit increases in the assessed
value of certain class one, class two and class four properties. The
properties that will be subject to the limitations in this section must
satisfy the following conditions:
1. The Department of Finance reduced the assessed value of the building
on the property on the assessment roll completed in 2013 from the
assessed value on the assessment roll completed in 2012 as a result of
damage caused by Hurricane Sandy.
2. The Department of Finance increased or will increase the assessed
value of the building on the property as a result of the repair or
reconstruction of damage caused by Hurricane Sandy on any assessment
roll completed from 2014 through 2020.
For properties that satisfy these conditions and have not performed
repairs or reconstruction as of the assessment roll completed in 2015,
the physical increase to their assessed value as a result of repairs or
reconstruction that will be performed will be limited to the amount of
the physical decrease reflected on the assessment roll completed in
2013. Any increase in excess of the amount of the physical decrease
reflected on the assessment roll completed in 2013 will be treated as an
equalization (non-physical) increase and subject to the limitations for
equalization increases prescribed in sections 1805(1) and 1805(2) of the
Real Property Tax Law. The assessed values of the properties that satis-
fy the requisite conditions will not be higher than they would have been
but for Hurricane Sandy. For class four and larger class two properties
subject to transitional assessments, the limitation on physical
increases will apply to the lower of the actual assessed value or the
transitional assessed value.
For properties that satisfy these conditions and have already performed
repairs or reconstruction that constitute a physical increase reflected
on an assessment roll completed as of 2015, the assessed value as it
appeared on the assessment roll completed in 2015 will be recalculated
as if section 1805-a had been in effect. The Department of Finance is
authorized to correct the 2015/2016 assessed value in accordance with
section 1805-a within ninety days of the effective date of a local law
adopting these provisions. Subsequent physical increases reflected on an
assessment roll completed from 2016 through 2020 will also be subject to
the limitations described in the preceding paragraph. To the extent that
the square footage used to determine the assessed value of the building
on the property on a given assessment roll exceeds that reflected on the
assessment roll completed in 2012, the bill provides that the Department
of Finance will recalculate the limitation on physical increases by
multiplying it by the percentage of the excess square footage of the
building.
Section two provides that the bill shall take effect immediately.
JUSTIFICATION: In its report, "One City, Rebuilding Together: A
Report on the City of New York's Response to Hurricane Sandy and the
Path Forward," the City set forth a number of policies to streamline the
recovery process and prioritize rebuilding. The policies outlined in the
report included, but were not limited to, improving the experience of
homeowners navigating the preconstruction process, enhancing coordi-
nation amongst city, state and federal partners, and engaging local
communities in the rebuilding process. Notably, the report also recom-
mended providing additional financial relief to homeowners. This legis-
lation continues the City's commitment to do that.
This bill would provide real property tax relief to New York City resi-
dents who have already repaired or rebuilt properties that were damaged
by Hurricane Sandy or who will repair or rebuild properties through
fiscal year 2020. Even if the repair or rebuilding merely restores a
building to its condition prior to the storm, the assessed value, and
therefore the real property taxes, of some of these properties will be
higher after the rebuilding than it was prior to the storm. Last year
the City provided an abatement to owners who had rebuilt their proper-
ties and whose property taxes were higher in fiscal year 2015 than in
fiscal year 2013. The abatement, however, provided only temporary relief
and did not address the long-term negative impact on assessed values of
properties that are rebuilt. In order to further assist these property
owners, this bill authorizes New York City to enact a local law limiting
the amount that assessed values can increase as a result of the repair
or rebuilding of properties severely damaged by Hurricane Sandy.
The amount of increase in assessed value will be limited to the amount
that it would have increased if Hurricane Sandy had not occurred for
affected property which, for purposes of this legislation, includes
certain class one, class two and class four properties. In the event
that the repair or rebuilding resulted in an increase in the square
footage of the affected property, the bill provides that the Department
of Finance will adjust the limitation on increases in assessed value by
the percentage that is attributable to the excess square footage of the
property.
As the worst natural disaster ever to hit the City of New York, Hurri-
cane Sandy cost forty-four New Yorkers their lives. Many more residents
lost homes or businesses, and entire communities were sent reeling by
the storm's devastating impact. There is a great deal more work to do to
help the hardest-hit communities get back on their feet and we must
continue to be vigilant in marshaling City resources to provide relief
to those who need it most.
Unfortunately, the statutory real property tax assessment structure does
not contemplate the unique circumstance that many property owners find
themselves in as a result of Hurricane Sandy: that these property owners
would, in effect, suffer a tax penalty for rebuilding their storm-torn
properties.
This legislation provides an absolutely necessary measure of relief to
owners of class one, class two and class four properties who begin the
rebuilding process to return to normalcy.
