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A06257 Summary:

BILL NOA06257A
 
SAME ASSAME AS S04098-A
 
SPONSORThiele
 
COSPNSRBarrett, Wallace, Jacobson, Otis, Forrest, Levenberg, Rosenthal L, Brabenec, Maher
 
MLTSPNSR
 
Add 6-w, Gen Muni L; add Art 33-C 1575 - 1588, Tax L
 
Authorizes cities and towns, except a city with a population of one million or more, to establish community preservation funds; authorizes such cities and towns to impose a real estate transfer tax with revenues to be deposited in such funds; makes related provisions.
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A06257 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A6257A
 
SPONSOR: Thiele
  TITLE OF BILL: An act to amend the general municipal law, in relation to authorizing cities and towns, except a city with a population of one million or more, to establish community preservation funds; and to amend the tax law, in relation to authorizing cities and towns, except a city with a population of one million or more, to impose a real estate transfer tax with revenues therefrom to be deposited in such funds   PURPOSE: To authorize cities and towns, except a city with a population of one million or more, to establish community preservation funds.   SUMMARY OF SPECIFIC PROVISIONS: Section 1. Amends the General Municipal Law to authorize towns and cities outside of the City of New York to establish community preserva- tion funds by local law, to be funded through the imposition of a real property transfer tax of up to two percent (2%). Enumerates purposes and management of such fund. Section 2. Amends the Tax Law to authorize eligible localities, acting through its governing board, to adopt a local law, subject to mandatory referendum, imposing separate real estate transfer tax and supplemental real estate transfer tax for the purposes of funding an established community preservation fund. Section 3. Severability Section 4. Immediate effective date   JUSTIFICATION: This legislation will help towns and cities with fewer than one million residents throughout the State of New York to fund land preservation with resources far beyond those which would otherwise be available through existing property taxes to reverse the trend toward over-devel- opment. It also provides a revenue source to implement projects that would help improve water quality. Specifically, this bill will authorize the governing boards of towns and cities, except New York City, to establish a Community Preservation Fund (CPF), by local law. The residents of these municipalities would then be able to choose, by mandatory referendum, to impose a real estate trans- fer tax, subject to certain exemptions and credits, to be paid by the purchaser of certain real estate at a rate of up to two percent of the purchase price. For each city or town so choosing, the revenues from the tax will be deposited into a dedicated fund to finance a land preserva- tion program. This dedicated fund would be used for the preservation of environmentally sensitive, recreational, or historic lands by acquisi- tion of fee title or lesser interests in such properties. Up to ten percent of the CPF may be used for the management and stewardship of acquired properties. Since the inception of the Peconic Bay Community Preservation Fund in 1999, the two percent real estate transfer tax for land acquisition for open space, farmland, and historic preservation, as well as recreational purposes, has been successful in raising over $1.655 billion to protect over 10,000 acres of land on the East End of Long Island. Since then, similar authorization has been granted to several local governments across the state on a case-by-case basis. This legislation would extend this opportunity to designated cities and towns throughout the State of New York where protecting community character, preserving open space and safeguarding water supplies are of extreme importance.   LEGISLATIVE HISTORY: 2021-22: A.7632/S.7041   FISCAL IMPLICATIONS: None to the state.   EFFECTIVE DATE: This act shall take effect immediately.
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A06257 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         6257--A
 
                               2023-2024 Regular Sessions
 
                   IN ASSEMBLY
 
                                      April 3, 2023
                                       ___________
 
        Introduced by M. of A. THIELE, BARRETT, WALLACE, JACOBSON, OTIS, FORREST
          --  read  once  and  referred to the Committee on Local Governments --
          committee discharged, bill amended, ordered reprinted as  amended  and
          recommitted to said committee
 
        AN  ACT  to  amend the general municipal law, in relation to authorizing
          cities and towns, except a city with a population of  one  million  or
          more,  to establish community preservation funds; and to amend the tax
          law, in relation to authorizing cities and towns, except a city with a
          population of one million or more, to impose a  real  estate  transfer
          tax with revenues therefrom to be deposited in such funds
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. The general municipal  law  is  amended  by  adding  a  new
     2  section 6-w to read as follows:
     3    §  6-w.  Community preservation funds. 1. As used in this section, the
     4  following words and terms shall have the following meanings:
     5    (a) "Community  preservation"  shall  mean  and  include  any  of  the
     6  purposes outlined in subdivision four of this section.
     7    (b)  "Board" means the advisory board required pursuant to subdivision
     8  five of this section.
     9    (c) "City or town" means a city, except a city with  a  population  of
    10  one million or more, or a town.
    11    (d) "Governing body" means a city council or town board.
    12    (e)  "Fund"  means the community preservation fund created pursuant to
    13  subdivision two of this section.
    14    (f) "Water quality improvement project" means: (1) any project  eligi-
    15  ble  for  state funding under the clean water infrastructure fund of two
    16  thousand seventeen, pursuant to part T of  chapter  fifty-seven  of  the
    17  laws  of  two  thousand  seventeen or (2) any project eligible for state
    18  funding as a safe drinking water project or clean water project pursuant
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD05666-02-3

        A. 6257--A                          2
 
     1  to title two or title three of article fifty-six  of  the  environmental
     2  conservation law.
     3    2.  The  governing body of any city or town is authorized to establish
     4  by local law a community preservation fund pursuant to the provisions of
     5  this section. Deposits into the fund may include revenues of  the  local
     6  government  from  whatever  source  and shall include, at a minimum, all
     7  revenues from a tax imposed upon the transfer of real property interests
     8  in such city or town pursuant to subdivision one of section one thousand
     9  five hundred seventy-six of the tax law. The fund shall also be  author-
    10  ized to accept gifts of any such interests in land or of funds. Interest
    11  accrued by monies deposited into the fund shall be credited to the fund.
    12  In  no  event  shall  monies deposited in the fund be transferred to any
    13  other account. Nothing contained in this section shall be  construed  to
    14  prevent the financing in whole or in part, pursuant to the local finance
    15  law, of any acquisition authorized pursuant to this section. Monies from
    16  the  fund  may  be  utilized  to  repay  any indebtedness or obligations
    17  incurred pursuant to the local finance law consistent with  effectuating
    18  the purposes of this section.
    19    3.  The  purposes of the fund shall be exclusively, (a) to implement a
    20  plan for the preservation of community character  as  required  by  this
    21  section,  (b)  to  acquire  interests or rights in real property for the
    22  preservation of community character within the designated city  or  town
    23  including  villages  therein in accordance with such plan and in cooper-
    24  ation with willing sellers, (c) to establish a bank pursuant to a trans-
    25  fer of development rights program as permitted by law, (d) to provide  a
    26  management  and  stewardship  program  for  such  interests  and  rights
    27  consistent with subdivision nine of this section and in accordance  with
    28  such  plan  designed  to preserve community character; provided that not
    29  more than ten (10) percent of the fund shall be utilized for the manage-
    30  ment and  stewardship  program,  and  (e)  to  implement  water  quality
    31  improvement  projects  in  accordance  with a plan to preserve community
    32  character. If the implementation of the community  preservation  project
    33  plan,  adopted  by  a  governing body, as provided in subdivision six of
    34  this section, has been completed, and funds are no longer needed for the
    35  purposes outlined in this subdivision, then any remaining monies in  the
    36  fund  shall  be applied to reduce any bonded indebtedness or obligations
    37  incurred to effectuate the purposes of  this  section.  Preliminary  and
    38  incidental  costs  in  connection  with  the acquisition of interests or
    39  rights in real property, pursuant to this subdivision, shall  be  deemed
    40  part  of  the cost of the acquisition for which they were incurred. Such
    41  expenditures  may  include  any  administrative  or  other  expenditures
    42  directly arising therefrom. No expenditure shall be charged to the fund,
    43  unless  authorized  by  law.  A  full  accounting of such costs for each
    44  acquisition of land shall be provided by the governing body.
    45    4. Preservation of community character shall involve one  or  more  of
    46  the  following:  (a) establishment of parks, nature preserves, or recre-
    47  ation areas; (b) preservation  of  open  space,  including  agricultural
    48  lands provided, however, that farm buildings and structures used for the
    49  production  and marketing of farm products produced on such agricultural
    50  lands shall be permitted;  (c)  preservation  of  lands  of  exceptional
    51  scenic  value;  (d) preservation of fresh and saltwater marshes or other
    52  wetlands; (e) preservation of aquifer recharge areas;  (f)  preservation
    53  of  undeveloped  beach lands or shoreline including those at significant
    54  risk of coastal flooding due to projected  sea  level  rise  and  future
    55  storms;  (g)  establishment of wildlife refuges for the purpose of main-
    56  taining native animal species diversity,  including  the  protection  of

        A. 6257--A                          3
 
     1  habitat  essential  to  the  recovery  of rare, threatened or endangered
     2  species; (h) preservation of pine barrens consisting of  such  biota  as
     3  pitch  pine,  and  scrub  oak;  (i) preservation of unique or threatened
     4  ecological  areas;  (j)  preservation  of  rivers  and  river areas in a
     5  natural, free-flowing condition; (k) preservation of forested land;  (l)
     6  preservation  of  public access to lands for public use including stream
     7  rights and waterways; (m) preservation of historic places and properties
     8  listed on  the  New  York  state  register  of  historic  places  and/or
     9  protected  under a municipal historic preservation ordinance or law; (n)
    10  preservation of lands necessary to protect fisheries and water dependent
    11  uses essential to maintain and enhance maritime heritage; and (o) under-
    12  taking any of the aforementioned in furtherance of the establishment  of
    13  a greenbelt.  Preservation of community character shall also include the
    14  protection and improvement of the quality of all water resources.
    15    5.  The  governing  body  of  any city or town which has established a
    16  community preservation fund shall create an advisory board to review and
    17  make recommendations on proposed acquisitions of interests in real prop-
    18  erty or water quality improvement projects using monies from  the  fund.
    19  Such board shall consist of five or seven legal residents of the munici-
    20  pality  who  shall  serve  without  compensation. No member of the local
    21  legislative body shall serve on the board. A majority of the members  of
    22  the  board shall have demonstrated experience with conservation and land
    23  preservation activities or water  quality  improvement  activities.  The
    24  board shall act in an advisory capacity to the governing body.
    25    6.  The  governing  body  of  any city or town which has established a
    26  community preservation fund shall, by local law, adopt a community pres-
    27  ervation project plan. This plan shall list every project which the city
    28  or town plans to undertake pursuant to the community preservation  fund.
    29  It  shall  include every parcel which is necessary to be acquired in the
    30  city or town in order to protect community character.   Such plan  shall
    31  provide for a detailed evaluation of all available land use alternatives
    32  to  protect  community  character, including but not limited to: (a) fee
    33  simple  acquisition,   (b)   zoning   regulations,   including   density
    34  reductions,  cluster development, and site plan and design requirements,
    35  (c) transfer of development rights,  (d)  the  purchase  of  development
    36  rights, and (e) scenic and conservation easements. Said evaluation shall
    37  be  as  specific as practicable as to each parcel selected for inclusion
    38  in the plan. The plan shall establish the priorities  for  preservation.
    39  Said  plan shall also list every water quality improvement project which
    40  the city or town plans to undertake pursuant to the community  preserva-
    41  tion  fund and shall state how such project would improve existing water
    42  quality. Projects which have as their purpose the accommodation  of  new
    43  growth  as opposed to the remediation of water quality shall not qualify
    44  for funding under this section. Funds from  the  community  preservation
    45  fund  may only be expended for projects which have been included in said
    46  plan. The plan shall be updated not less than once every five years  and
    47  shall be completed at least sixty (60) days before the submission of the
    48  mandatory  referendum required by section fifteen hundred seventy-six of
    49  the tax law. As part of, or in addition, to said community  preservation
    50  fund  project  plan, each governing body may also adopt a management and
    51  stewardship plan for interests  or  rights  in  real  property  acquired
    52  pursuant to this section.  No monies from the fund shall be expended for
    53  management  and  stewardship, except as approved in said plan. Said plan
    54  may provide management and stewardship projects for up to a  three  year
    55  period  and  shall  provide  a  description  and estimated cost for each
    56  project. Said plan shall be approved and adopted by local law and may be

        A. 6257--A                          4
 
     1  updated from time to time at the discretion of the local governing body.
     2  Only management and stewardship projects permitted pursuant to  subdivi-
     3  sion nine of this section shall be eligible to be included in the plan.
     4    7.  The  governing  body  of  any city or town which has established a
     5  community preservation fund pursuant  to  this  section  shall  consider
     6  establishing  a transfer of development rights program to protect commu-
     7  nity character consistent with state law. If at any time during the life
     8  of the community preservation fund  a  transfer  of  development  rights
     9  program  is  established,  the  city or town may utilize monies from the
    10  community preservation fund in order to create and fund a  central  bank
    11  of the transfer of development rights program. If at any time during the
    12  life  of  the  community  preservation  fund,  a transfer of development
    13  rights program is repealed by the city or  town,  all  monies  from  the
    14  central bank shall be returned to the community preservation fund.
    15    8.  No interests or rights in real property shall be acquired pursuant
    16  to this section until a public hearing is held as  required  by  section
    17  two hundred forty-seven of this chapter; provided, however, that nothing
    18  in  this  section  shall prevent the governing body from entering into a
    19  conditional purchase agreement before a  public  hearing  is  held.  Any
    20  resolution of a governing body approving an acquisition of land pursuant
    21  to  this  section,  shall find that acquisition was the best alternative
    22  for the protection of community character of all the reasonable alterna-
    23  tives available to the city or town.
    24    9. Lands acquired pursuant to this section shall be  administered  and
    25  managed  in  a  manner  which  (a)  allows public use and enjoyment in a
    26  manner compatible with the natural,  scenic,  historic  and  open  space
    27  character  of  such lands; (b) preserves the native biological diversity
    28  of such lands; (c) with regard to open spaces,  limits  improvements  to
    29  enhancing  access  for  passive use of such lands such as nature trails,
    30  boardwalks, bicycle paths, and peripheral parking  areas  provided  that
    31  such  improvements  do  not  degrade the ecological value of the land or
    32  threaten essential wildlife habitat; and (d) preserves cultural property
    33  consistent with  accepted  standards  for  historic  preservation.    In
    34  furthering the purposes of this section, the city or town may enter into
    35  agreements with conservation organizations formed under the not-for-pro-
    36  fit  corporation  law  and  engaged  in  land trust activities to manage
    37  lands, including less  than  fee  interests  acquired  pursuant  to  the
    38  provisions  of  this  section,  provided  that  any such agreement shall
    39  contain a provision that such corporation shall keep the lands  accessi-
    40  ble  to  the public unless the governing body finds that public accessi-
    41  bility would be detrimental to the lands or any natural resources  asso-
    42  ciated  therewith.  Except  for  interests  or  rights  in real property
    43  acquired for historic preservation purposes, management and  stewardship
    44  projects  shall  be  only  expended  for  (1) projects which promote the
    45  protection or enhancement of the natural, scenic, and open space charac-
    46  ter for which the interests or rights in real property were acquired, or
    47  (2) accessory uses related to the purpose for  which  the  interests  or
    48  rights  in real property were acquired consistent with this subdivision,
    49  or (3) restoration of  acquired  real  property  to  its  natural  state
    50  including  the  demolition  of existing buildings and structures. In the
    51  case of interests or rights in real property acquired for historic pres-
    52  ervation purposes, funds may be expended only for  the  restoration  and
    53  rehabilitation  of  buildings  and  structures  consistent with accepted
    54  state and federal standards for historic preservation. Expenses  related
    55  to  the  customary  operation  and  maintenance of acquired interests or
    56  rights in real property shall  not  be  permitted  from  the  fund.  Any

        A. 6257--A                          5
 
     1  expenditure from the fund for a purpose other than that permitted, here-
     2  in, shall be deemed to be prohibited.
     3    10.  Rights  or  interests  in real property acquired with monies from
     4  such fund shall not be sold, leased, exchanged,  donated,  or  otherwise
     5  disposed  of  or  used  for  other  than  the purposes permitted by this
     6  section without the express authority of  an  act  of  the  legislature,
     7  which  shall  provide for the substitution of other lands of equal envi-
     8  ronmental value and fair market value and reasonably equivalent  useful-
     9  ness  and location to those to be discontinued, sold or disposed of, and
    10  such other requirements as shall be approved by the legislature. Nothing
    11  in this section shall preclude a city or town, by local law, from estab-
    12  lishing additional restrictions to  the  alienation  of  lands  acquired
    13  pursuant  to  this section. This subdivision shall not apply to the sale
    14  of development rights by a  city  or  town  acquired  pursuant  to  this
    15  section,  where said sale is made by a central bank created by a city or
    16  town, pursuant to a transfer of development rights  program  established
    17  by  a city or town, provided, however (a) that the lands from which said
    18  development rights were acquired shall remain preserved in perpetuity by
    19  a permanent conservation easement or  other  instrument  that  similarly
    20  preserves the community character referenced in subdivision four of this
    21  section,  and  (b) the proceeds from such sale shall be deposited in the
    22  community preservation fund.
    23    11. Notwithstanding any provision of law to the  contrary,  cities  or
    24  towns  may  enter  into  inter-municipal  agreements pursuant to article
    25  five-G of this chapter  for  the  following  purposes:  (a)  to  jointly
    26  acquire  interests  or  rights  in  real  property,  consistent with the
    27  purposes of this section, where the acquisition  of  such  interests  or
    28  rights  promotes  a  regional  public  benefit for two or more cities or
    29  towns pursuant to a regional plan, (b) to establish an office or depart-
    30  ment to render legal opinions  and  interpretations  to  facilitate  the
    31  efficient  and consistent administration of each fund created under this
    32  section, (c) to provide for  an  independent  financial  audit  of  each
    33  city's  or town's fund, and (d) to hire employees necessary to implement
    34  the provisions of this section.
    35    12. Each city or town which has established a  community  preservation
    36  fund  shall  annually  commission  an independent audit of the fund. The
    37  audit shall be conducted by an independent certified  public  accountant
    38  or  an independent public accountant. Said audit shall be performed by a
    39  certified public accountant or an independent  public  accountant  other
    40  than  the  one  that performs the general audit of each city's or town's
    41  finances. Such audit shall be an  examination  of  the  fund  and  shall
    42  determine  whether  the  fund  has been administered consistent with the
    43  provisions of this section and all other applicable provisions of  state
    44  law. Said audit shall be initiated within sixty days of the close of the
    45  fiscal  year  of  each  city  or  town and shall be completed within one
    46  hundred twenty days of the close of the fiscal year. A copy of the audit
    47  shall be submitted annually to the state comptroller  and  the  city  or
    48  town  clerk.  A  copy of the audit shall be made available to the public
    49  within thirty days of its completion. A notice of the completion of  the
    50  audit  shall  be published in the official newspaper of the city or town
    51  and posted on the official sign board of the city  or  town  within  ten
    52  days  of  its  filing  with the town clerk.  Said audit and notice shall
    53  also be posted on the internet site for the city or town.  The  cost  of
    54  the audit may be a charge to the fund.
    55    13. The cost of employees and independent contractors to implement the
    56  provisions  of  this  section may only be paid for by the fund where the

        A. 6257--A                          6
 
     1  duties and responsibilities of said employees and  independent  contrac-
     2  tors  are  directly  dedicated  to  implementing  the provisions of this
     3  section. Where such employees and independent contractors are not exclu-
     4  sively dedicated to implementing the provisions of this section, no more
     5  than  the  cost of the actual time expended directly dedicated to imple-
     6  menting the provisions of this section may be charged. Such costs  shall
     7  be  expressly identified in the city or town budget and any plan adopted
     8  pursuant to this section before funds for such costs may be expended. In
     9  addition, such costs must be documented by  a  time  accounting  system,
    10  subject  to audit. Costs relating to the activities of elected officials
    11  implementing the purposes of this section may not be  a  charge  to  the
    12  fund.
    13    §  2.  The  tax law is amended by adding a new article 33-C to read as
    14  follows:
    15                                 ARTICLE 33-C
    16               TAX ON REAL ESTATE TRANSFERS IN CITIES OR TOWNS
    17  Section 1575. Definitions.
    18          1576. Imposition of tax.
    19          1577. Payment of tax.
    20          1578. Liability for tax.
    21          1579. Exemptions.
    22          1580. Credit.
    23          1581. Cooperative housing corporation transfers.
    24          1582. Designation of agents.
    25          1583. Liability of recording officer.
    26          1584. Deposit and disposition of revenue.
    27          1585. Judicial review.
    28          1586. Apportionment.
    29          1587. Miscellaneous.
    30          1588. Returns to be secret.
    31    § 1575. Definitions. When  used  in  this  article,  unless  otherwise
    32  expressly stated, the following words and terms shall have the following
    33  meanings:
    34    1. "Person" means an individual, partnership, limited liability compa-
    35  ny,  society,  association,  joint  stock  company, corporation, estate,
    36  receiver, trustee, assignee, referee or any other  person  acting  in  a
    37  fiduciary  or  representative  capacity, whether appointed by a court or
    38  otherwise, any combination of individuals, and any other form  of  unin-
    39  corporated enterprise owned or conducted by two or more persons.
    40    2.  "Controlling  interest"  means  (a)  in the case of a corporation,
    41  either fifty percent or more of the total combined voting power  of  all
    42  classes  of  stock  of such corporation, or fifty percent or more of the
    43  capital, profits or beneficial interest in such  voting  stock  of  such
    44  corporation, and (b) in the case of a partnership, association, trust or
    45  other  entity,  fifty percent or more of the capital, profits or benefi-
    46  cial interest in such partnership, association, trust or other entity.
    47    3. "Real property" means every estate or right,  legal  or  equitable,
    48  present  or future, vested or contingent, in lands, tenements or heredi-
    49  taments, including buildings, structures and other improvements thereon,
    50  which are located in whole or in part within any city or town. It  shall
    51  not include rights to sepulture.
    52    4.  "Consideration"  means  the  price actually paid or required to be
    53  paid for the real property or interest therein, including payment for an
    54  option or contract to purchase real property, whether or  not  expressed
    55  in  the deed and whether paid or required to be paid by money, property,
    56  or any other thing of  value.  It  shall  include  the  cancellation  or

        A. 6257--A                          7
 
     1  discharge  of  an  indebtedness or obligation. It shall also include the
     2  amount of any mortgage, purchase money mortgage, lien  or  other  encum-
     3  brance,  whether  or not the underlying indebtedness is assumed or taken
     4  subject to.
     5    (a)  In the case of a creation of a leasehold interest or the granting
     6  of an option with use and  occupancy  of  real  property,  consideration
     7  shall  include, but not be limited to, the value of the rental and other
     8  payments attributable to the use and occupancy of the real  property  or
     9  interest therein, the value of any amount paid for an option to purchase
    10  or  renew  and the value of rental or other payments attributable to the
    11  exercise of any option to renew.
    12    (b) In the case of a creation of a  subleasehold  interest,  consider-
    13  ation  shall  include,  but not be limited to, the value of the sublease
    14  rental payments attributable to the use and occupancy of the real  prop-
    15  erty,  the value of any amount paid for an option to renew and the value
    16  of rental or other payments attributable to the exercise of  any  option
    17  to  renew  less  the  value of the remaining prime lease rental payments
    18  required to be made.
    19    (c) In the case of a controlling interest in any entity that owns real
    20  property, consideration shall mean the fair market  value  of  the  real
    21  property or interest therein, apportioned based on the percentage of the
    22  ownership interest transferred or acquired in the entity.
    23    (d)  In the case of an assignment or surrender of a leasehold interest
    24  or the assignment or surrender of an option or contract to purchase real
    25  property, consideration shall not include the  value  of  the  remaining
    26  rental  payments required to be made pursuant to the terms of such lease
    27  or the amount to be paid for the real property pursuant to the terms  of
    28  the option or contract being assigned or surrendered.
    29    (e) In the case of (1) the original conveyance of shares of stock in a
    30  cooperative housing corporation in connection with the grant or transfer
    31  of a proprietary leasehold by the cooperative corporation or cooperative
    32  plan  sponsor, and (2) the subsequent conveyance by the owner thereof of
    33  such stock in a cooperative housing corporation in connection  with  the
    34  grant  or  transfer  of  a  proprietary leasehold for a cooperative unit
    35  other than an individual residential unit, consideration shall include a
    36  proportionate share of the unpaid principal of any mortgage on the  real
    37  property  of  the cooperative housing corporation comprising the cooper-
    38  ative dwelling or dwellings. Such share shall be determined by multiply-
    39  ing the total unpaid principal of the mortgage by a fraction, the numer-
    40  ator of which shall be the number of shares of stock being  conveyed  in
    41  the  cooperative  housing  corporation  in  connection with the grant or
    42  transfer of a proprietary leasehold and the denominator of  which  shall
    43  be the total number of shares of stock in the cooperative housing corpo-
    44  ration.
    45    5.  "Conveyance"  means  the  transfer or transfers of any interest in
    46  real property by  any  method,  including  but  not  limited  to,  sale,
    47  exchange,  assignment, surrender, mortgage foreclosure, transfer in lieu
    48  of foreclosure, option,  trust  indenture,  taking  by  eminent  domain,
    49  conveyance upon liquidation or by a receiver, or transfer or acquisition
    50  of a controlling interest in any entity with an interest in real proper-
    51  ty.  Transfer of an interest in real property shall include the creation
    52  of  a  leasehold  or  sublease only where (a) the sum of the term of the
    53  lease or sublease and any options for renewal exceeds forty-nine  years,
    54  (b)  substantial  capital  improvements are or may be made by or for the
    55  benefit of the lessee or sublessee, and (c) the lease or sublease is for
    56  substantially all  of  the  premises  constituting  the  real  property.

        A. 6257--A                          8
 
     1  Notwithstanding  the  foregoing,  conveyance  of real property shall not
     2  include a conveyance made pursuant to devise,  bequest  or  inheritance;
     3  the  creation,  modification,  extension,  spreading, severance, consol-
     4  idation,  assignment, transfer, release or satisfaction of a mortgage; a
     5  mortgage subordination agreement, a  mortgage  severance  agreement,  an
     6  instrument given to perfect or correct a recorded mortgage; or a release
     7  of lien of tax pursuant to this chapter or the internal revenue code.
     8    6.  "Interest in the real property" includes title in fee, a leasehold
     9  interest, a beneficial interest, an encumbrance, development rights, air
    10  space and air rights, or any other interest with the  right  to  use  or
    11  occupancy  of  real  property  or the right to receive rents, profits or
    12  other income derived from real property. It shall also include an option
    13  or contract to purchase real property. It shall not include a  right  of
    14  first refusal to purchase real property.
    15    7.  "Grantor"  means the person making the conveyance of real property
    16  or interest therein. Where the conveyance consists of a transfer  or  an
    17  acquisition  of  a controlling interest in an entity with an interest in
    18  real property, "grantor" means the entity with an interest in real prop-
    19  erty or a shareholder  or  partner  transferring  stock  or  partnership
    20  interest, respectively.
    21    8.  "Grantee"  means  the person who obtains real property or interest
    22  therein as a result of a conveyance.
    23    9. "Fund" means a community  preservation  fund  created  pursuant  to
    24  section six-w of the general municipal law.
    25    10. "Recording officer" means the county clerk.
    26    11.  "City or town" means a city or town, except a city of one million
    27  or more.
    28    12. "Treasurer" means the county treasurer.
    29    § 1576. Imposition of tax. 1. Notwithstanding any other provisions  of
    30  law  to the contrary, any city or town, acting through its local govern-
    31  ing body, is hereby authorized and empowered to adopt a local law impos-
    32  ing in such city or town a tax on each conveyance of  real  property  or
    33  interest  therein  where the consideration exceeds five hundred dollars,
    34  at a rate of up to two percent of the consideration for such conveyance.
    35  Provided, however, any such local law imposing, repealing or  reimposing
    36  such  tax shall be subject to a mandatory referendum pursuant to section
    37  twenty-three of the municipal home rule law. Such local law  shall  only
    38  be  submitted  for  the  approval of the electors at a general election.
    39  Notwithstanding the foregoing, prior to adoption of such local law,  the
    40  city  or  town  must establish a community preservation fund pursuant to
    41  section six-w of the general municipal law. Revenues from such tax shall
    42  be deposited in such fund and may be used solely  for  the  purposes  of
    43  such  fund. Such local law shall apply to any conveyance occurring on or
    44  after the first day of a month to be designated by such local  governing
    45  body,  which  is  not  less  than sixty days after the enactment of such
    46  local law, but shall not apply to conveyances made on or after such date
    47  pursuant to binding written contracts entered into prior to  such  date,
    48  provided  that  the  date  of execution of such contract is confirmed by
    49  independent evidence such as the recording of the contract, payment of a
    50  deposit or other facts and circumstances as determined by the treasurer.
    51    2. Notwithstanding any other provisions of law  to  the  contrary,  in
    52  addition  to  the tax authorized by subdivision one of this section, any
    53  city or town, acting through its governing body,  is  hereby  authorized
    54  and  empowered  to  adopt  a  local  law imposing in such city or town a
    55  supplemental tax on each conveyance of real property or interest therein
    56  where the consideration exceeds five hundred dollars, at the rate of  up

        A. 6257--A                          9
 
     1  to  one  half  of  one percent of the consideration for such conveyance.
     2  Provided, however, any such local law imposing, repealing or  reimposing
     3  such  supplemental tax shall be subject to a mandatory referendum pursu-
     4  ant  to  section  twenty-three of the municipal home rule law.  Revenues
     5  from such supplemental tax shall be deposited in such community  housing
     6  fund  and  may be used solely for the purposes of such community housing
     7  fund. Such local law shall apply to any conveyance occurring on or after
     8  the first day of a month to be designated by the governing board,  which
     9  is  not  less than sixty days after the enactment of such local law, but
    10  shall not apply to conveyances made on or after such  date  pursuant  to
    11  binding written contracts entered into prior to such date, provided that
    12  the  date  of  execution  of  such  contract is confirmed by independent
    13  evidence such as the recording of the contract, payment of a deposit  or
    14  other  facts  and  circumstances as determined by the treasurer. Any tax
    15  imposed pursuant to this subdivision shall be administered and collected
    16  in a like manner as the tax imposed by subdivision one of this section.
    17    § 1577. Payment of tax. 1. The real estate transfer tax imposed pursu-
    18  ant to this article shall be paid to  the  treasurer  or  the  recording
    19  officer  acting  as  the agent of the treasurer upon designation as such
    20  agent by the treasurer. Such tax shall be paid at the same time  as  the
    21  real  estate  transfer tax imposed by article thirty-one of this chapter
    22  is required to be paid.   Such  treasurer  or  recording  officer  shall
    23  endorse  upon  each  deed or instrument effecting a conveyance a receipt
    24  for the amount of the tax so paid.
    25    2. A return shall be required to  be  filed  with  such  treasurer  or
    26  recording  officer  for purposes of the real estate transfer tax imposed
    27  pursuant to this article at the same time as a return is required to  be
    28  filed  for  purposes  of the real estate transfer tax imposed by article
    29  thirty-one of this chapter. The treasurer shall prescribe  the  form  of
    30  return,  the  information  which it shall contain, and the documentation
    31  that shall accompany the return.  Said form shall be  identical  to  the
    32  real estate transfer tax return required to be filed pursuant to section
    33  fourteen  hundred  nine of this chapter, except that the treasurer shall
    34  adapt said form to reflect the  provisions  in  this  chapter  that  are
    35  inconsistent,  different,  or  in  addition to the provisions of article
    36  thirty-one of this chapter.    The  real  estate  transfer  tax  returns
    37  required  to  be  filed  pursuant to this section shall be preserved for
    38  three years and thereafter until such  treasurer  or  recording  officer
    39  orders them to be destroyed.
    40    3.  The  recording  officer shall not record an instrument effecting a
    41  conveyance unless the return required by this section has been filed and
    42  the tax imposed pursuant  to  this  article  shall  have  been  paid  as
    43  required in this section.
    44    §  1578.  Liability  for tax. 1. The real estate transfer tax shall be
    45  paid by the grantee. If the grantee has failed to pay  the  tax  imposed
    46  pursuant  to this article or if the grantee is exempt from such tax, the
    47  grantor shall have the duty to pay the tax. Where the  grantor  has  the
    48  duty  to pay the tax because the grantee has failed to pay the tax, such
    49  tax shall be the joint and several liability  of  the  grantee  and  the
    50  grantor.
    51    2. For the purpose of the proper administration of this article and to
    52  prevent evasion of the tax hereby imposed, it shall be presumed that all
    53  conveyances are taxable. Where the consideration includes property other
    54  than  money,  it  shall  be  presumed that the consideration is the fair
    55  market value of the real property or interest  therein.  These  presump-
    56  tions  shall  prevail  until  the  contrary is proven, and the burden of

        A. 6257--A                         10
 
     1  proving the contrary shall be on the person liable for  payment  of  the
     2  tax.
     3    §  1579. Exemptions. 1. The following shall be exempt from the payment
     4  of the real estate transfer tax: (a) the state of New York,  or  any  of
     5  its  agencies,  instrumentalities,  political  subdivisions,  or  public
     6  corporations (including a public  corporation  created  pursuant  to  an
     7  agreement or compact with another state or Dominion of Canada); and
     8    (b)  the  United  Nations,  the United States of America or any of its
     9  agencies or instrumentalities.
    10    2. The tax shall not apply to any of the following conveyances:    (a)
    11  conveyances  to  the  United  Nations, the United States of America, the
    12  state of New York, or any of their instrumentalities, agencies or  poli-
    13  tical subdivisions (or any public corporation, including a public corpo-
    14  ration  created  pursuant  to agreement or compact with another state or
    15  the Dominion of Canada); (b) conveyances  which  are  or  were  used  to
    16  secure  a debt or other obligation; (c) conveyances which, without addi-
    17  tional consideration, confirm, correct,  modify  or  supplement  a  deed
    18  previously  recorded; (d) conveyances of real property without consider-
    19  ation and otherwise than in connection  with  a  sale,  including  deeds
    20  conveying realty as bona fide gifts; (e) conveyances given in connection
    21  with a tax sale; (f) conveyances to effectuate a mere change of identity
    22  or form of ownership or organization where there is no change in benefi-
    23  cial  ownership,  other than conveyances to a cooperative housing corpo-
    24  ration of the real  property  comprising  the  cooperative  dwelling  or
    25  dwellings;  (g)  conveyances  which  consist of a deed of partition; (h)
    26  conveyances given pursuant to the federal bankruptcy act; (i) conveyanc-
    27  es of real property which consist of the execution of a contract to sell
    28  real property without the use or  occupancy  of  such  property  or  the
    29  granting of an option to purchase real property without the use or occu-
    30  pancy  of  such  property;  (j)  conveyances of real property, where the
    31  entire parcel of real property to be conveyed is the subject of  one  or
    32  more  of  the  following  development  restrictions:  (1)  agricultural,
    33  conservation, scenic, or  an  open  space  easement,  (2)  covenants  or
    34  restrictions  prohibiting  development,  (3)  a  purchase of development
    35  rights agreement, (4) a transfer of development rights agreement,  where
    36  the  property being conveyed has had its development rights removed, (5)
    37  said real property is subject to the development restriction of an agri-
    38  cultural district or individual commitment, pursuant to article  twenty-
    39  five-AA of the agriculture and markets law, (6) real property subject to
    40  any locally adopted land preservation agreement, provided said exemption
    41  is  included  in the local law imposing the tax authorized by this arti-
    42  cle; (k) conveyances of real property,  where  the  property  is  viable
    43  agricultural  land  as  defined  in  subdivision  seven of section three
    44  hundred one of the agriculture and markets law and the  entire  property
    45  to  be  conveyed  is  to  be  made  subject  to  one  of the development
    46  restrictions provided for in subparagraph two of paragraph (j)  of  this
    47  subdivision  provided  that  said  development restriction precludes the
    48  conversion of the property to a non-agricultural use for at least  three
    49  years  from  the  date  of transfer, and said development restriction is
    50  evidenced by an easement, agreement, or other suitable instrument  which
    51  is to be conveyed to the city or town simultaneously with the conveyance
    52  of  the  real  property;  or  (l)  conveyances of real property for open
    53  space, parks, community housing, or historic  preservation  purposes  to
    54  any  not-for-profit  tax  exempt  corporation operated for conservation,
    55  environmental, community housing or historic preservation purposes.

        A. 6257--A                         11
 
     1    3. The governing body of a city or town, by local law may establish  a
     2  community  housing  exemption.  Such  exemption may not exceed an amount
     3  equal to the residential median sale price of the county  in  which  the
     4  city  or  town  is located, as determined by the office of real property
     5  services  within  the department of taxation and finance. Such exemption
     6  shall be allowed on the consideration of the conveyance of improved real
     7  property or an interest therein. The exemption granted pursuant  to  the
     8  provisions of this subdivision shall only apply to conveyances for resi-
     9  dential property where the consideration is two million dollars or less.
    10    §  1580.  Credit.  A grantee shall be allowed a credit against the tax
    11  due on a conveyance of real property to the extent tax was paid by  such
    12  grantee  on  a  prior creation of a leasehold of all or a portion of the
    13  same real property or on the  granting  of  an  option  or  contract  to
    14  purchase  all  or  a  portion of the same real property by such grantee.
    15  Such credit shall be  computed  by  multiplying  the  tax  paid  on  the
    16  creation  of  the leasehold or on the granting of the option or contract
    17  by a fraction, the numerator of which is the value of the  consideration
    18  used  to  compute  such tax paid which is not yet due to such grantor on
    19  the date of the subsequent conveyance (and which such grantor  will  not
    20  be entitled to receive after such date), and the denominator of which is
    21  the total value of the consideration used to compute such tax paid.
    22    §  1581. Cooperative housing corporation transfers. 1. Notwithstanding
    23  the definition of "controlling interest" contained in subdivision two of
    24  section fifteen hundred seventy-five of this article or anything to  the
    25  contrary contained in subdivision five of section fifteen hundred seven-
    26  ty-five  of this article, the tax imposed pursuant to this article shall
    27  apply to (a) the original conveyance of shares of stock in a cooperative
    28  housing corporation in connection  with  the  grant  or  transfer  of  a
    29  proprietary leasehold by the cooperative corporation or cooperative plan
    30  sponsor,  and  (b)  the subsequent conveyance of such stock in a cooper-
    31  ative housing corporation in connection with the grant or transfer of  a
    32  proprietary  leasehold  by  the  owner thereof. With respect to any such
    33  subsequent conveyance where the property is  an  individual  residential
    34  unit,  the  consideration  for  the  interest conveyed shall exclude the
    35  value of any liens on certificates of stock or  other  evidences  of  an
    36  ownership  interest  in  and  a  proprietary lease from a corporation or
    37  partnership formed for the purpose of cooperative ownership of  residen-
    38  tial  interest  in  real estate remaining thereon at the time of convey-
    39  ance. In determining the tax on a conveyance described in paragraph  (a)
    40  of  this subdivision, a credit shall be allowed for a proportionate part
    41  of the amount of any tax paid upon the  conveyance  to  the  cooperative
    42  housing  corporation  of  the  real  property comprising the cooperative
    43  dwelling or dwellings to the extent that such conveyance  effectuated  a
    44  mere  change of identity or form of ownership of such property and not a
    45  change in the beneficial ownership of such property. The amount  of  the
    46  credit  shall  be  determined by multiplying the amount of tax paid upon
    47  the conveyance to the cooperative housing corporation  by  a  percentage
    48  representing  the  extent  to  which  such conveyance effectuated a mere
    49  change of identity or form of ownership and not a change in the  benefi-
    50  cial  ownership  of  such  property,  and then multiplying the resulting
    51  product by a fraction, the numerator of which shall  be  the  number  of
    52  shares  of stock conveyed in a transaction described in paragraph (a) of
    53  this subdivision, and the denominator of which shall be the total number
    54  of shares of stock of the cooperative housing corporation (including any
    55  stock held by the corporation). In no event, however, shall such  credit
    56  reduce  the  tax,  on  a  conveyance  described in paragraph (a) of this

        A. 6257--A                         12
 
     1  subdivision, below zero, nor shall any such credit be allowed for a  tax
     2  paid  more than twenty-four months prior to the date on which occurs the
     3  first in a series of conveyances of shares of stock in  an  offering  of
     4  cooperative  housing  corporation  shares  described in paragraph (a) of
     5  this subdivision.
     6    2. Every cooperative housing corporation shall be required to file  an
     7  information  return  with  the  treasurer by July fifteenth of each year
     8  covering the preceding period of January first  through  June  thirtieth
     9  and  by  January fifteenth of each year covering the preceding period of
    10  July first through December thirty-first. The return shall contain  such
    11  information  regarding  the conveyance of shares of stock in the cooper-
    12  ative housing corporation as the treasurer may deem  necessary,  includ-
    13  ing,  but  not limited to, the names, addresses and employee identifica-
    14  tion numbers or social security numbers of the grantor and the  grantee,
    15  the  number  of  shares  conveyed,  the  date  of the conveyance and the
    16  consideration paid for such conveyance.
    17    § 1582. Designation of agents. The treasurer is authorized  to  desig-
    18  nate  the  recording  officer to act as his or her agent for purposes of
    19  collecting the tax authorized  by  this  article.  The  treasurer  shall
    20  provide  for the manner in which such person may be designated as his or
    21  her agent subject to such terms and conditions as  the  treasurer  shall
    22  prescribe.  The  real estate transfer tax shall be paid to such agent as
    23  provided in section fifteen hundred seventy-seven of this article.
    24    § 1583. Liability of recording officer. A recording officer shall  not
    25  be  liable  for  any inaccuracy in the amount of tax imposed pursuant to
    26  this article that he or she shall collect so long as  he  or  she  shall
    27  compute and collect such tax on the amount of consideration or the value
    28  of  the  interest conveyed as such amounts are provided to him or her by
    29  the person paying the tax.
    30    § 1584. Deposit and disposition of revenue. 1.  All  taxes,  penalties
    31  and  interest imposed by the city or town under the authority of section
    32  fifteen hundred seventy-six of this article, which are collected by  the
    33  treasurer  or  his  or  her agents, shall be deposited in trust funds as
    34  provided by this section for the city or town and shall be kept in trust
    35  and separate and apart from all other monies in possession of the treas-
    36  urer. The treasurer or his or her  agents  shall  provide  for  separate
    37  trust  funds  for community preservation and community housing revenues.
    38  Moneys in such fund  shall  be  deposited  and  secured  in  the  manner
    39  provided  by  section ten of the general municipal law. Pending expendi-
    40  ture from such fund, moneys  therein  may  be  invested  in  the  manner
    41  provided  in  section  eleven of the general municipal law. Any interest
    42  earned or capital gain realized on the moneys so deposited  or  invested
    43  shall accrue to and become part of such fund.
    44    2.  The  treasurer shall retain such amount as he or she may determine
    45  to be necessary for refunds with respect to the tax imposed by the  city
    46  or  town,  under the authority of section fifteen hundred seventy-six of
    47  this article, out of which the treasurer shall pay any refunds  of  such
    48  taxes to those taxpayers entitled to a refund pursuant to the provisions
    49  of this article.
    50    3. The treasurer, after reserving such refunds, shall on or before the
    51  twelfth day of each month pay to the city comptroller or the town super-
    52  visor  the  taxes,  penalties and interest imposed by the town under the
    53  authority of  section  fifteen  hundred  seventy-six  of  this  article,
    54  collected  by  the  treasurer,  pursuant to this article during the next
    55  preceding calendar month. The amount so payable shall  be  certified  to
    56  the  city comptroller or the town supervisor by the treasurer, who shall

        A. 6257--A                         13
 
     1  not be held liable for any inaccuracy in such  certification.  Provided,
     2  however,  any such certification may be based on such information as may
     3  be available to the treasurer at the time  such  certification  must  be
     4  made  under  this  section. Where the amount so paid over to the city or
     5  town in any such distribution is more or less than the amount due to the
     6  city or town, the amount of the overpayment  or  underpayment  shall  be
     7  certified to the city comptroller or the town supervisor by the treasur-
     8  er,  who  shall  not  be  held liable for any inaccuracy in such certif-
     9  ication. The amount of the  overpayment  or  underpayment  shall  be  so
    10  certified  to  the city comptroller or the town supervisor as soon after
    11  the discovery of the overpayment or underpayment as reasonably  possible
    12  and  subsequent payments and distributions by the treasurer to such city
    13  or town shall be adjusted by subtracting the amount of any such overpay-
    14  ment from or by adding the amount  of  any  such  underpayment  to  such
    15  number  of  subsequent  payments  and distributions as the treasurer and
    16  city comptroller or town supervisor shall consider reasonable in view of
    17  the overpayment or underpayment and all other facts and circumstances.
    18    4. All monies received from the treasurer shall be  deposited  in  the
    19  appropriate  fund  of the city or town, pursuant to section six-w of the
    20  general municipal law.
    21    § 1585. Judicial review. 1. Any final determination of the  amount  of
    22  any  tax  payable  under  section  fifteen hundred seventy-eight of this
    23  article shall be reviewable for error, illegality or unconstitutionality
    24  or any other reason whatsoever by a proceeding  under  article  seventy-
    25  eight  of  the  civil  practice law and rules if application therefor is
    26  made to the supreme court within four months after  the  giving  of  the
    27  notice  of  such  final  determination, provided, however, that any such
    28  proceeding under article seventy-eight of the  civil  practice  law  and
    29  rules shall not be instituted unless (a) the amount of any tax sought to
    30  be reviewed, with such interest and penalties thereon as may be provided
    31  for  by  local law shall be first deposited and there is filed an under-
    32  taking, issued by a surety company authorized to  transact  business  in
    33  this  state  and approved by the state superintendent of insurance as to
    34  solvency and responsibility, in such amount as a justice of the  supreme
    35  court  shall  approve to the effect that if such proceeding be dismissed
    36  or the tax confirmed the petitioner will pay all costs and charges which
    37  may accrue in the prosecution of such proceeding or (b) at the option of
    38  the petitioner, such undertaking may be in a sum sufficient to cover the
    39  taxes, interest and penalties stated in  such  determination,  plus  the
    40  costs  and charges which may accrue against it in the prosecution of the
    41  proceeding, in which event the petitioner shall not be required  to  pay
    42  such taxes, interest or penalties as a condition precedent to the appli-
    43  cation.
    44    2.  Where any tax imposed hereunder shall have been erroneously, ille-
    45  gally or unconstitutionally assessed or collected  and  application  for
    46  the refund or revision thereof duly made to the proper fiscal officer or
    47  officers,  and  such officer or officers shall have made a determination
    48  denying such refund or revision, such determination shall be  reviewable
    49  by  a  proceeding  under article seventy-eight of the civil practice law
    50  and rules; provided, however, that (a)  such  proceeding  is  instituted
    51  within  four months after the giving of the notice of such denial, (b) a
    52  final determination of tax due was  not  previously  made,  and  (c)  an
    53  undertaking  is filed with the proper fiscal officer or officers in such
    54  amount and with such sureties as a justice of the  supreme  court  shall
    55  approve  to  the  effect that if such proceeding be dismissed or the tax

        A. 6257--A                         14

     1  confirmed, the petitioner will pay  all  costs  and  charges  which  may
     2  accrue in the prosecution of such proceeding.
     3    § 1586. Apportionment. A local law adopted by any city or town, pursu-
     4  ant  to  this  article,  shall provide for a method of apportionment for
     5  determining the amount of tax due whenever the real property or interest
     6  therein is situated within and without the city or town.
     7    § 1587. Miscellaneous. A local law adopted by any city or town, pursu-
     8  ant to this article, may contain such other provisions as  the  city  or
     9  town  deems  necessary  for the proper administration of the tax imposed
    10  pursuant to this article, including provisions concerning  the  determi-
    11  nation  of tax, the imposition of interest on underpayments and overpay-
    12  ments and the imposition of civil penalties. Such  provisions  shall  be
    13  identical  to  the  corresponding provisions of the real estate transfer
    14  tax imposed by article thirty-one  of  this  chapter,  so  far  as  such
    15  provisions  can  be  made applicable to the tax imposed pursuant to this
    16  article.
    17    § 1588. Returns to be secret. 1.  Except  in  accordance  with  proper
    18  judicial order or as otherwise provided by law, it shall be unlawful for
    19  the  treasurer  or  any officer or employee of the county, city or town,
    20  including any person engaged or  retained  on  an  independent  contract
    21  basis,  to divulge or make known in any manner the particulars set forth
    22  or disclosed in any return required under a local law  enacted  pursuant
    23  to  this article.  Provided, however, that nothing in this section shall
    24  prohibit the recording officer from making a notation on  an  instrument
    25  affecting  a  conveyance  indicating the amount of tax paid. No recorded
    26  instrument affecting a conveyance  shall  be  considered  a  return  for
    27  purposes of this section.
    28    2.  The officers charged with the custody of such returns shall not be
    29  required to produce any of them or evidence  of  anything  contained  in
    30  them  in  any action or proceeding in any court, except on behalf of the
    31  county, city,  or  town  in  any  action  or  proceeding  involving  the
    32  collection of a tax due under a local law enacted pursuant to this arti-
    33  cle to which such county, city, or town is a party, or a claimant, or on
    34  behalf  of any party to any action or proceeding under the provisions of
    35  a local law enacted pursuant to this article when the returns  or  facts
    36  shown thereby are directly involved in such action or proceeding, in any
    37  of  which  events the court may require the production of, and may admit
    38  in evidence, so much of said returns or of the facts shown  thereby,  as
    39  are pertinent to the action or proceeding and no more.
    40    3. Nothing in this section shall be construed to prohibit the delivery
    41  to  a  grantor or grantee of an instrument effecting a conveyance or the
    42  duly authorized representative of a grantor or grantee  of  a  certified
    43  copy  of  any  return  filed  in  connection  with such instrument or to
    44  prohibit the publication of statistics so classified as to  prevent  the
    45  identification  of  particular  returns  and  the  items thereof, or the
    46  inspection by the legal representatives of such county, city, or town of
    47  the return of any taxpayer who shall bring action to set aside or review
    48  the tax based thereon.
    49    § 3. Severability. If any provision of this  act  or  the  application
    50  thereof  shall  for  any  reason  be  adjudged by any court of competent
    51  jurisdiction to be invalid, such judgment shall not affect,  impair,  or
    52  invalidate the remainder of this act, but shall be confined in its oper-
    53  ation  to  the provision thereof directly involved in the controversy in
    54  which such judgment shall have been rendered.
    55    § 4. This act shall take effect immediately.
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