CHAFTER- - - - - - LAWS OF 20 !),;... '------ ASSEMBLY BILL SENATE BILL - - - - - - - - 8823--B 2001-2002 Regular Sessions IN ASSEMBLY May 17, 2001 Introduced by COMMITTEE ON RULES -- (at request of M. of A. Higgins, Hoyt, Tokasz, DelMonte, Robach, "Magnarelli, Ortiz, Tocci, Weisenberg) read once and referred to the Committee on Real Property Taxation -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee -- recommitted to the Committee on Real Property Taxation in accordance with Assembly Rule 3, sec. 2 committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the real property tax law, in relation to residential-commercial urban exemption program creating the DATE RECEIVED BY GOVERNOR: Tj;z~/&;)ACTION MUS'I' BE TAKEN BY: ~je/v,9- DATE GOVERNOR'S ACTION TAKEN: h!H~ Uh I.D02 "" , .. ~ U;)i..;UC,l SENATE VOTE DATE ASSEMBLY VOTE DATE HOME RULE MESSAGE 0002 RETRIEVE BILL Page 1 of2 NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec l(e) BILL NUMBER: A8823B SPONSOR: Rules (Higgins) TITLE OF BILL: An act to amend the real property tax law, in relation to creating the residential-commercial urban exemption program PURPOSE OR GENERAL IDEA OF BILL: Bill amends the real property tax law to allow 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 or more. SUMMARY OF SPECIFIC PROVISIONS: This bill would provide property tax exemptions for the first eight tax years equal to 100% of the value added to the portion of a building that is attributable exclusively to residential construction of a combination of residential and commercial mixed uses. Moreover, this bill would provide for a property tax exemption of 80% in the ninth year, a 60% exemption in the tenth year, a 40% exemption in the eleventh year and a 20% exemption in the twelfth year. Furthermore, buildings designated as a landmark as set forth in local law would receive a property tax exemption for residential and commercial reconstruction work. This bill would include a 100% property tax exemption for the first nine years, an 80% exemption in year ten, a 60% exemption in year eleven, a 40% exemption in year twelve, and a 20% exemption in year thirteen. JUSTIFICATION: Urban centers of New York can be revitalized with the creative reuse of office, warehouse, manufacturing, and retail buildings for residential and commercial mixed uses. Property tax exemptions have proven to provide a strong incentive to stimulate capital investment and encourage developers to undertake the reconstruction of office space and properties formerly housing warehouse, manufacturing and retail activities into residential units and commercial mixed uses. In fact, this program was offered in the early 1990s when the stock market crash resulted in a glut of vacant office space in the Wall Street area. Property tax exemptions were used to encourage developers to reconstruct office space into residential and commercial mixed uses. This program is widely cited as the primary influence for the revitalization that has occurred and continues in the lower Manhattan area of New York City. PRIOR LEGISLATIVE HISTORY: A8823 - 2001 85540 - 2001 FISCAL IMPLICATIONS: To be determined EFFECTIVE DATE: This act shall take effect on the one hundred eightieth day after it shall become law. 000003 STATE OF NEW YORK OFFICE OF THE ATTORNEY GENERAL ELIOT SPITZER Attorney General Legislative Bureau TO: COUNSEL TO THE GOVERNOR Re: SENATE ASSEMBLY 8823-B Inasmuch as this bill does not appear to relate to the functions of the Department of Law, I am not commenting thereon. However, if there is a particular aspect of the bill upon which you wish comment, please advise me. ELIOT SPITZER ATTORNEY GENERAL Date: July 3, 2002 000004 The Capitol, Albany, N.Y. 12224-0341. Phone (518) 486-3000. Fax (518) 474-4290 http://www.oag.state.ny.us BUDGET REPORT ON BILLS SENATE: No. Introduced by: Committee on Rules Law: Real Property Tax Sections: S~_§SiGft-¥e~02 ASSEMBLY: No. 8823--B 485-a (new) Division of the Budget recommendation on the above bill: Approve: 1. Veto: No Objection: x No Recommendation: Subject and Purpose: To stimulate economic growth in the State's urban areas by establishing a tax incentive for conversion of underutilized commercial properties into mixed-use properties that have both residential and commercial use. 2. Summary of Provisions: Effective 180 days after its enactment, this bill would authorize cities with populations between 50,000 and 1 million to provide a property tax exemption for increases in value attributable to construction and renovation resulting in the conversion of commercial properties to miixed-use properties that contain commercial space and residential units. Each exemption will be equal to 100 percent of the increase in value (minimum $10,000, or larger at local option) for the first eight years following the development, dropping by 20 percent in each subsequent year. At the end of 12 years, the mixed-use properties will become fully taxable. Once a city has adopted the mixed-use exemption, school districts and counties that include all or portions of that city may also grant the exemption. 3. Legislative History: A similar bill (A .8823/S. 5540) died in committee in 2001. Chapter 4 of the Laws of '1995 enacted a similar program f~r cities with a population of one million or more. 4. Arguments in Support: By providing a tax incentive for the development of mixed-use properties, this bill could transform some of the underutilized office and factory spaces in 12 large and medium sized cities like Buffalo, Rochester, Syracuse and Yonkers into productive assests. Arguably, the resultant infusion of population and business growth would be more than sufficient to offset the revenue losses due to the tax exemption. It can be argued that the success of a similar exemption program in New York City (authorized by Chapter 4 of the Laws of 1995) has demonstrated the effectiveness of tax incentives for mixed-use properties in addressing urban decay in older industrial cities. 000005 2 By encouraging the creation of residential housing units in commercial districts, this bill is likely to ease the housing shortage in the cities while providing an antidote for excessive suburban sprawl. 5. Arguments in Opposition: While an increase in the number of mixed-use properties helped the revitalization of New York City during the1990s, it may not be an effective tool of economic development in other cities in the State at this time. Many of these large and medium sized cities have an excess supply of housing stock due to several reasons, including the population shift to suburbs, and business failures and relocations. At the same time most of the cities also have a shortage of lowincome housing units. This bill has the potential to exacerbate the glut in the urban housing market while adding little to the availability of low-income housing. It can also be argued that this bill is unnecessarily restrictive in scope. First, it excludes cities with less than 50,000 residents so that while cities like Albany and Schenectady could provide the tax exemption, the cities of Binghamton and Troy are left out without any apparent reason. Secondly, given the objective of boosting urban economies, there is no clear reason why the tax incentive is limited to development of mixed-use property. For instance, despite its obvious economic impacts, redevelopment of an underutilized warehouse into retail space will not be eligible for the tax exemption because that project would not result in a mixed-use property. 6. Other State Agencies Interested: The Office of Real Property Services. 7. Other Interested Groups: New York State Assessors Association. New York State Conference of Mayors New York State School Board Association 8. Budget Implications: This bill contains no significant costs to the State or local governments. If successful, implementation of the proposal has the potential to spur economic development in certain cities and, in the long run, result in improved tax bases for the State and local governments. 9. Recommendation: There are some legitimate questions about the viability of this bill to revive the economies of New York's cities because it transplants a development tool from New York City to other cities with little refinements, and because it is too restrictive in scope (see 5 above). However, the bill affords an option to certain cities to experiment with a tax incentive program in conjunction with other development initiatives (e.g., the Empire Zones) at no cost to the State or local governments. Therefore, the Division of the Budget has no objection to its approval. 8000Ge STATE OF NEW YORK DEPARTMENT OF STATE 4 I STATE STREET ALBANY, NY 12231-000 I GEORGE E. RANDY PATAKI A. DANIELS SECRETARY OF STATE GOVERNOR MEMORANDUM May 21,2002 TO: Honorable James M. McGuire, Esq. Counsel to the Governor FROM: Joshua B. Toas, ESq@ Assistant Secretary of State and Deputy Counsel SUBJECT: A. 8823-B (Committee on Rules) Recommendation: No objection The Industrial and Commercial Incentive Program (ICIP), a system of phased real property tax exemptions instituted within New York City in 1984, has been credited with revitalizing large portions of that city's older building stock. L.1984, c. 966. In 1992, ICIP benefits were extended to the commercial components of improved mixed residential and commercial buildings. L. 1992, c. 781. The latter amendment resulted in the development of mixed-use projects providing a variety of retail, residential and commercial uses. This bill draws on the success of the "mixed-use" component of the ICIP, by granting similar exemptions to properties in the cities of Albany, Buffalo, Mount Vernon, New Rochelle, Niagara Falls, Rochester, Schenectady, Syracuse, Utica and Yonkers which are converted from non-residential to mixed commercial and residential use. The exemption will apply to varying portions of the increase in assessed valuation attributable to the conversion, for a period of 12 years beyond the owner's initial application. The Secretary of State serves as Vice Chair of the state's Quality Communities Interagency Task Force. By virtue of its role in the Quality Communities effort as well as through its general responsibilities to assist local governments under Article 6-B of the Executive Law, the Department of State is vitally concerned about both the viable redevelopment of the state's older downtowns as well as the wise use and conservation of undeveloped areas. This bill will advance those purposes by encouraging downtown redevelopment for a variety of uses, which should also lessen the pressure to develop open areas. Potentially, it will also result in a savings in housing and transportation costs by encouraging people to live closer to work. 000007 WWW.DOS.STATE.NY.US E-MAIL: INFO@DOS.STATE.NY.US RECYCLED PAPER The bill is meritorious in its efforts to encourage redevelopment in the state's cities and blighted urban environs. It is, however, limited in scope and only benefits urban downtowns in cities with populations of over 50,000 and under one million. The Department is concerned that there are declining urbanized downtowns in many other municipalities that could benefit from a mixed-use redevelopment exemption; the program should be extended to those additional communities. The bill memo also purports to provide the exemption to real property "formerly used for office, warehouse, manufacturing and retail uses". The bill's benefits are not, however, limited to vacant properties. This could act as an incentive to displace existing employment activities within urban areas, which we believe would be counterproductive. Based on the foregoing comments, the Department of State expresses no objection to the approval of the bill. JBT/HJW/sm 2 (;00008 THE STATE EDUCATION DEPARTMENT I THE UNIVERSITY OF THE STATE OF NEW YORK I ALBANY, NY 12234 Counsel and Deputy Commissioner for legal Affairs Tel. 518-474-6400 Fax 518-474-1940 May 24,2002 TO: Counsel to the Governor FROM: Kathy A. Ahearn SUBJECT: A. 8823-B RECOMMENDATION: No objection REASON FOR RECOMMENDATION: This bill adds a new §435-A to the Real Property Tax Law to authorize cities having a population of 50,000 or more but less than 1 million, and city school districts in such cities, to grant real property tax exemptions to persons who convert non-residential real property to mixed use property to be used for both residential and commercial purposes. The exemption would apply to the increase in assessed value attributable to the conversion, with a 100% exemption in years 1 to 8 and a 20% reduction each year through year 12. (;00009 Judith A. Calogero Commissioner George E. Pataki Governor New York State Division of Housing and Community Renewal Hampton Plaza 38-40 State Street Albany, NY 12207 TO: James M. McGuire Counsel to the Governor FROM: Marcia P. Hirsch General Counsel DATE: July 31,2002 SUBJECT: Assembly Bill # 8823-B Sponsored by the Committee on Rules, at the request of M. of A. Higgins Amends the real property tax law relating to creating the residential-commercial urban exemption program The Division has no objection to this bill, which would add a new Section 485-A to the Real Property Tax Law to create the residential-commercial urban exemption program. The bill would allow municipalities to offer property tax exemptions to developers and building owners to convert commercial space to residential units and commercial mixed uses in downtown areas of Buffalo, Niagara Falls, Rochester, Syracuse and other municipalities, thus encouraging the . revitalization of these urban centers. G00010 Web Site: www.dhcr.state.ny.us T:4 :1 _..J..1~. ..11 :.~.£'_/:::.\.11 .L_.L_ ~ _ 5184743657 06/19 '02 14:44 NO.673 08 MemorandulU 9iATlE OF NEW YORK ~x!eQTlYl; IlI!I'AftTMe~T OFFICE OF ~EAL pROPERTY SEFMCES Ju.ne 14 1 2002 To: Richard J. Sinnott From, Stephen J. Harrison!JII Subject: Senate Bill No. 2J.~O-A By: S€n. Alesi et al. This bill would amend the State Administrative Procedure in relatlon to the conduct of adj udica.tory proceedings (SAFA, Art. 3). It is the latest incarna.tion of many bills that have preceded it, several of which have been vetoed (~l 1989 Senate Bill No. 3613-A - Veto Messa.ge No. 22; 1990 Assembly Bill No. 9194-A - Veto Message No. 23; 1993 Senate Bill No. 2340-A Veto Message No. 40). While the bill's avowed pu.rpose of better assuring the fairness of such proceedings is la.udable, it appears that lts sponsors have ignored the impact the bill would have on a.gencies such ae this one which annua.lly condu.ct a. rela.tively sma.ll number of such proceedings. Act Bill section one would. define "presiding officer" for purposes of SAPA (new §102 (14)) . While the term would inclu.de hea.ring officers, hearing examinere and administrative law judges, it would exclude a.gency heade a.nd members of state boards (~, State Board of Real Property Services) or commissions. Bill section two would totally rewrite sectj.on 303 of SAPA presiding' officers. * In addition to understandably regarding Intere,stingly, while SAPA has been the frequent SUbject of revision since its enactment (L .1975, c .167) 1 section 303 has not been amended heretofore. legislative 06/19/02 WED 14:50 [TX/RX NO 9281] 06/19 '02 14:44 NO.673 09 MEMORANDUM Richard J. Sinnott, Esq. Pa.ge 2 June 14, 2002 expe.cting ethical conduct from su.ch officers, the bill would disqualify them if they have obtained material concerning a proceeding by reason of their agency employment and that information was obtained outside the presence of all parties to the proceeding (proposed §303(2} (f}). Where a party is unsuccessful in convincing an agency to remove a presiding officer from a proceeding, the party could file an affidavit of disqu.alification with the Attorney GeneraJ. whose decision would bind the agency and the party (proposed §303(6)). Bill section three would amend section 307 (2) of SAPA to conform references therein to the newly defi.ned "presiding officer." Bill section four would add new section 306 establishing a fairly complex procedure aocommodating presiding officers within agencies. A 'separate administrative unit (reporting only to the agency head) would be necessary ( although unit personnel could be assigned non-adjudicatory functions not in conflict with su.ch proceedings. For many years, even in years in which this agency conducted significant numbers of adjudicatory hearings, we have contracted wi th private pra.ctj.ce attorneys to act a.s h.earing officers. Arguably, this procedure has provided parties with the same protections this bill is j.ntended to provide, without the expense a.nd administra,tive bu.rden this bill wou,ld impose. While the strictures this bill would impose on agencies that routinely conduct adjudicatory hearings might be sensible or even necessary in. those agencies, they would be burdensome for us ( adding' expense at a time when bUdgetary constraints are tightening on seemingly a daily basis. 000012 06/19/02 WED 14:50 CTX/RX NO 92811 5184743657 06/19 '02 14:42 NO.673 02 STATE OF NEW YORK EXECUTIVE DEPARTMENT tHOMAS G. GRIFFEN /OXECOiIVE DIRECTOR OFFICE OF REAl.. PROPERTY SERViCES 16 SJ:illJUDAN AVENUE ALBANY, NEW YORK J.22J.()-2714 T~L. (518) 474·S7l J FAX (5 t 8) 474-9276 Wc!)gitc: hltl.:lIwww.l)rputate.ny.us June 19,2002 Hon.orable James M. McGuire Counsel to the Governor Executive Cham.ber nd 2 PloOTt State Capitol Albany, NY 12224 Re: Assembly Bill No. 8823-B By: M. of A. Higgins Dear Mr. McGuire: This bill would authorize certain cities to adopt a local law to create a. "Residentialcommerci.al urban. exemption program". Th.e particulars are spelled out in the atta.ched memorandum of my colleague, Robert Mark, Esq. Since this bill would offer th.e exemption on. B. local, opt-in, basis, we take no position with respect to possible Executive action thereon~ but rather defer to tbe judgment of the elected representatives ofthe elIgible cities. I would note that the effective date clause ofthe bill (§2) includes an. odd referen.ce; authorizing the State Board of Real Property Services "to promulgate any and all rules an.d regulations an.d take any other mea.sures o.ecessary to implement this act on its effective date on or before such date". Since the text of the proposed section 48S-a only refers to the State Board as havin.g to prescribe an appropriate application form for the exemption (see proposed subd. 5), I assume that tlle referen.ce to ruJe~making is superfluous, particularly in. Hght ofthe Court of Appeals' extremely narrow reading of the Board;s authority in matters related to exemptions in State Board of Equalization. & Assessment v. Kerwick, 52 N.Y.2d 557 (1981). Very truly yours, ~f~ Ricbard J. Sinnott 000013 06/19/02 WED 14:50 [TX/RX NO 9281] 5184743657 STATEOFN THOMAS G. GRIFFEM ~ECU11VE DIRECTOR 06/19 102 14:42 NO.673 03 .ORK RICHARD J. SfNNOTT Exr:JCUTIVE DEPARlMENT eO~"""'" OFFICE OF REAL PROPERTY SERVICES 16 SHERIDAN AVENUE ALBANY, NEW YORK. 12210-27J4 TEL. ('/8) 4·74·571.1 .FAX (5 J8) 474-9276 Web5ite: http://www.orps.state.ny.us June 18, 2002 Honorable James M. McGuire Counsel to the Govem.or Executive Chamber .2nd Floor, State Capitol Albany, NY 12224 Re: Sen.ate Bill No. 2190-A By; Sen. Alesi, et al Dear Mr. McGuire; The provisions of this bill., which wou.ld amend the State Administradve Proced.ure Act (SAPA) in regard to the conduct of adjudicatory proceediD.gs~ are well summarized in the attaehedrnern.orandum of my co)1eaguc, Stephen J. Harrison, Esq. The bill seems well-intentioned, in that it evidently seeks to ensure the fairness of such proceedin.gs by more carefully "drawing the line" between agency personnel conductin.g those proceedings and agency management. This is an entirely reasonable goal. Unfortunately, the design of the bill is lacking i.n SQme important respects. In particular, the bilt would require each agency to establish a separate administrative unit, which would report only to the agency head, and would be made up of supervisors, presiding officers and support staff. For a comparatively small agency, such as ORPS, which conducts but a handful of adjudicatory proceedings each. year, this would be an enonnous administrative/hum.an. resource burden, Further, budgetary issues asi.de, it has been ORPS' practice for many years to hire attorneys in private practice - unbeholdcn. to the agency in any way -- to serve as hearing officers at such proceedings. Th.us, we have already a.chieved a system of indepen.dent bearing officers, and at a small fraction of the cost that a penn anent internal hearing unit would entai.1. The bill fails to recognize this accomplishm.ent and would effectively force us to expand our bureaucracy for n.o apparent reason. In summary, while we support without reservation the idea. of having in.dependent hearl.D.g offi.cers presidin.g over adjudicatory proceedings, the fact is that this bill would impose n () JUVv ( I (" 14 06/19/02 WED 14:50 [TX/RX NO 9281] 5184743657 06/19 102 14:43 NO.673 04 Honorable James M. McGuire Page 2 June 19,2002 substantial and needless budgetary demands upon agencies like ours at a time wh.en the State can least afford them. Accordingly, unless the sponsors are wHHng to add.ress this issue tlJTOU.gh a Chapter Amendment, we would respectfully recommend that tJu~ Govemor veto th.is bill. Very truly yOUTS, ~1j..~":c..",. . ,~. ,.,. . .-.,. Ri.cbard J. Sinnott G00015 06/19/02 WED 14:50 [TX/RX NO 9281] New York State Conference of Mayors and Municipal Officials 119 Washington Avenue, Albany, New York 12210 (518) 463-1185 Toll free number for NYCOM members 1-800·-446-9266 Fax # (518) 463-1190 Executive Committee President Ellen Polimeni June 25, 2002 Mayor, Canandaigua First Vice President Eugene J. Murray Mayor, Rockville Centre Second Vice President Richard A. Bucci Mayor, Binghamton Hon. James McGuire Counsel to the Governor State Capitol - Room 225 Albany, NY 12224 RE: A. 8823-B Treasurer Gerald D. Jennings Mayor, Albany Dear Mr. McGuire: Immediate Past President Joseph A. Griffo Mayor, Rome Members Michael R. Bloomberg Mayor, New York Alan J. Cohen Mayor, Ithaca Joseph Delfino Mayor, White Plains The Conference of Mayors has considered this legislation and recommends that it be approved by the Governor. This bill would authorize any city with a population of 50,000 or more but fewer than one million to enact a local law providing an exemption for non-residential real property converted to mixed use. The increase in assessed value attributable to such conversion would be 100% exempt for years one through eight, 80% for year nine, 60% for year ten, 40% for year eleven, 20% for year twelve, and fully taxable from that point forward. Susan C. Goetschius Mayor, Wellsville William A. Johnson, Jr. Mayor, Rochester Kim K. Muller Mayor, Oneonta Thomas E. Nyquist Mayor, New Paltz New York's economy depends upon the economic well-being of our urban centers, many of which are currently experiencing economic stagnation or decline. Mixed use development in downtown areas has proven successful at revitalizing the economic and social vibrancy of such areas. The local option exemption provided by this legislation would offer local officials a means of spurring mixed use development and, in the long term, expanding the local property tax base. Frank A. Pagano Mayor, Fredonia Ernest J. Strada Mayor, Westbury Gary A. Vegliante NYCOM believes that cities under 50,000 population and other local governments could also benefit from having access to the exemption program proposed in this legislation, and we will seek enactment of legislation providing therefor in the next legislative session. Mayor, West Hampton Dunes Affiliate Representative Karen P. Mclaughlin NYS Society of Municipal Finance Officers For all of the above reasons, the Conference of Mayors recommends the approval of this bill by the Governor. Sincerely, Past Presidents: Ex-Officio ~&~~~ Robert Elliott Mayor, Croton-on-Hudson Shawn D. Hogan Mayor, Hornell William H. Kelly Executive Director Mayor, Asharoken Executive Director Edward C. Farrell ECF/pab/mc* OG0016 5184743657 06/19 '02 14:43 NO.673 05 Mel1toranduln Ju.ne To: Richard Sinnott From: Robert Mark Subject: Assembly Bill No. 8823-B By: M. of A. Higgins 18, 2002 This bill wou.ld create a. Residentia.l-Commercial Urban Exemption Program for. cities whose popu.lation is between 50,000 and 1,000,000 1 by adding a new section 485~ato the Real Property Tax Law (hereafter RPTL). The Sponsor's Memorandu.m states that the purpose of the bill is to allow these municipalities to offer exemptions to developers and building owners to encourage creative reuse of office, warehouse, manufacturing, and retail bUildings in urban downtowns for r.esidential and commercial mixed uses. The bill is modeled after RPTt, §4 21 ~g, which w~,s enacted to provide an incentive for converting outmoded non-residential buildings in Lower Manhattan to residential use. As is the case wi th this bill, RPTL, §421-g, for a period of 12 years, provides a declining exemption for the increase in the property's assessed valuation attributable to the conversion. 2 ! The bill would apply to the following cities whose populations as reported by the 2000 federal census are between 50 000 and 1, 000, 000: Alba.ny, Buffalo, Mount Vernon, . New Rochelle, Niagara Falls, Rochester, Schenectady, Syracuse, Utica, White Plains and Yonkers. T This bill differs from the provisions of RPTL, §421-g p in several respects. Unlike RPTL, 5421-g, this bill would not authorize ta,x abatements in addition to exemptions. 2 (JU001? 06/19/02 WED 14:50 [TX/RX NO 9281] 5184743657 06/19 ·02 14:43 NO.673 06 -2- The exemption from city.taxation would be available at the local optlon of the city.3 If approved by the city through the adoption of a local law, the county in which the city is located, by adoption of a local law, may ~xempt such property from cou.nty taxation and county special ad valorem levies. Similarly, a school district located wholly or partially in the ci ty 4, by adoption of a resolution, may exempt such property from school taxa,tion (section one of the bill, page two, lines 10-15). The method of determlning the annual exemption stated this bill· could pose interpretative problems for the assessor. The annual exemption is to be calculated using the property's "exemption ba,se" which "shall be determined for each year in which there is an increase in assessed value so attributable from that of the previous year's assessed value" (emphasis added) (section one of the bill, page two, lines 23-26). This language could· be construed to mean tha,t the exemption depends on whether the j.n Despite a statement to the contrary in the Sponsor's Memorandum, the current version of this bill does not p·rovide an extra year of real pr.operty tax exemption for a property that has ·been designated as a landmark (cf., RPTL, §421-g (2) (b) ) • This bill does not sta.te a date by which eligible conversions must commence; in contrast, RPTL, §421-g (J.) (e), currently defines an eligible "commencement of conversion" as based on a building permit i.ssued no later than June 30, 2007. While the bill refers to exemption from "special ad valorem levies (see, bill section one, page two, lines 16 to 19), such provision would not apply to cities which do not impose specia.l ad valorem levies (see, Real Property 3 fl Tax Law, §102(14). It is not~worthy that of the eleven cities to which the bill applies, only the City of Schenectady has an enlarged school district encompassing an area outside the city. The four fiscally dependent school districts that would be affected by the bill, Bu.ffalo, Rochester, Syracuse and Yonkers (~, Education Law, §2550), do. not levy school taxes and could not exer.cise the option to exempt property from school taxation. 06/19/02 WED 14:50 [TX/RX NO 9281] 5184743657 06/19 102 14:43 NO.673 07 -3- property's a,ssessed valuation ha,s increased from its assessed valuation on the· previous year's roll. I presume that the biil inst~ad is intended to have the same meaning as the followin.g clearer provision of RPTL, §421-g (2) (a) : "shall be exempt ... on the a,mount of the assessed value attributable exclusively to the physical improvement, for a period not to exceed twelve consecutive years". If approved, this bill would after the bill becomes a law. s take effect 180 days 'A bill has been introduced in both houses (S.7488, A.11522) that would provide that this bill is to take effect immediately. Accordingly, if this bill is enacted, we will need to prepare a standard application as soon as possible, but I see no reason why' we will have ·to promulgate any new rules and regulation~ pursuant to section two of the bill . •< • ··r· .. (\19 U tJUlJ 06/19/02 WED 14:50 [TX/RX NO 9281] THE CITY OF NEW YORK OFFICE OF THE MAYOR ANTHONY P. PISCITELLI 66 John Street Director State Legislative Affairs New York, NY 10038 (212) 361-083:6 111 Washington .~ve. Albany, NY 12210 (518) 447-5200 MEMORANDUM TO: Honorable James M. McGuire Counsel to the Governor FROM: Anthony P. Piscitelli DATE: May 29, 2002 RE: A.8823-B - by Committee on Rules (at request of M. of A. Higgins, et al.) AN ACT to amend the real property tax law, in relation to creating the residential-commercial urban exemption program You have requested the comments and recommendation of Mayor concerning the above bill that is before the Governor executive action. the for Please be advised that the Mayor has no recommendation to this legislation. n/r The New York State Assessors' Association is opposed to this bill. This Association has been opposed to the ever expanding list of exemptions to the real property tax for many years. The only function of an exemption is to shift the tax burden to other taxpayers, (except STAR) . This exemption would provide a 100% exemption for the first eight years equal to the increase in value due to the conversion of a building from commercial to residential or the residential portion in a mixed use building. It then provides a decreasing exemption up to the twelfth year. What will happen if the residential conversion becomes either a condominium or a cooperative? Section 4 (d) states that no other exemption shall be granted concurrent with this proposed exemption. Does this mean the owners of the condo or co-op will not be eligible for STAR? We request that the Governor veto this legislation. interest in our comments. Thomas Frey Executive Secretary NYSAA Ulj 0021 Thank you for your New York State Conference of Mayors and Municipal Officials 119 Washington Avenue Albany, New York 12210 (518) 463-1185 Edward C. Farrell Executive Director May 15,2002 RE: A8823 The Conference of Mayors supports this bill and urges its enactment.