Bill Text: NY S02316 | 2023-2024 | General Assembly | Introduced

---

Bill Title: Relates to the certification of certain property complying with the residential-commercial urban exemption program and the revocation of benefits of such program in certain circumstances.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-01-03 - REFERRED TO LOCAL GOVERNMENT [S02316 Detail]

Download: New_York-2023-S02316-Introduced.html

---

                STATE OF NEW YORK
        ________________________________________________________________________

                                          2316

                               2023-2024 Regular Sessions

                    IN SENATE

                                    January 19, 2023
                                       ___________

        Introduced  by  Sen.  RYAN  --  read twice and ordered printed, and when
          printed to be committed to the Committee on Local Government

        AN ACT to amend the real property tax law, in relation  to  the  certif-
          ication  of certain property complying with the residential-commercial
          urban exemption program and the revocation of benefits of such program
          in certain circumstances

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Section 485-a of the real property tax law, as amended by
     2  chapter 132 of the laws of 2021, is amended to read as follows:
     3    § 485-a. Residential-commercial  urban  exemption  program.  1.  Defi-
     4  nitions.    As  used in this section, the following terms shall have the
     5  following meanings:
     6    (a) "Municipality" means any town, city or village except for  a  city
     7  having more than one million inhabitants.
     8    (b)  "Applicant" means any person obligated to pay real property taxes
     9  on the property for which an exemption from real  property  taxes  under
    10  this section is sought.
    11    (c)  "Commercial construction work" means the modernization, rehabili-
    12  tation, expansion or other improvement of the portion of mixed-use prop-
    13  erty to be used for commercial purposes.
    14    (d) "Commercial purpose or use" means [(i)]  the  buying,  selling  or
    15  otherwise  providing  of  goods  or services directly to the public[; or
    16  (ii) a non-residential lawful use including,  but  not  limited  to,  an
    17  office,  hotel, retail store, brewery, distillery, restaurant, cafe, bar
    18  or tavern, gymnasium, theater, or entertainment venue which  employs  or
    19  is  anticipated  to  employ a minimum of five employees primarily at the
    20  mixed-use property for which an exemption under this section is sought],
    21  including hotel services,  retail  stores,  office  space,  restaurants,
    22  bars, gyms, theaters, and cafes.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD00333-01-3
        S. 2316                             2

     1    (e)  "Mixed-use  property"  means  property on which will exist, after
     2  completion of residential construction work or a combination of residen-
     3  tial construction work and commercial construction work, a  building  or
     4  structure used for both residential and commercial purposes of which, at
     5  least  [forty]  fifty  percent  of  the  building  or structure's square
     6  footage is devoted to residential purposes or use and at  least  fifteen
     7  percent  of  the  building  or  structure's square footage is devoted to
     8  commercial purposes or use.   Only square footage existing  in  a  story
     9  above  grade  shall  be  used  in  the  determination  of the building's
    10  percentage of residential purposes or use  and  commercial  purposes  or
    11  use.
    12    (f)  "Person"  means  an  individual,  corporation,  limited liability
    13  company, partnership, association, agency,  trust,  estate,  foreign  or
    14  domestic government or subdivision thereof, or other entity.
    15    (g) "Residential construction work" means the creation, modernization,
    16  rehabilitation,  expansion or other improvement of dwelling units, other
    17  than dwelling units in a hotel, in the portion of mixed-use property  to
    18  be used for residential purposes.
    19    (h)  "Story  above  grade"  means  any story having its finished floor
    20  surface entirely above grade.
    21    (i) "Grade" shall mean the finished ground level adjoining the  build-
    22  ing at all exterior walls.
    23    (j)  "Floor  area" means the horizontal areas of the several floors or
    24  any portion thereof of a mixed-use property measured from  the  exterior
    25  faces  of  exterior walls or from the center line of party walls, exclu-
    26  sive of any area existing below-grade.
    27    2. Any municipality may, by local law, provide for  the  exemption  of
    28  real  property  from  taxation  as  provided  in  this section. Upon the
    29  adoption of such a local law, the county in which such  municipality  is
    30  located may, by local law, and any school district, all or part of which
    31  is located in such municipality, may, by resolution, exempt such proper-
    32  ty  from  its taxation in the same manner and to the same extent as such
    33  municipality has done.
    34    3. Upon the adoption of such a local law, non-residential real proper-
    35  ty, upon conversion to mixed-use property, shall be exempt from taxation
    36  and special ad valorem levies as provided for  in  subdivision  four  of
    37  this  section. Land which was vacant prior to the residential or commer-
    38  cial construction work for which a tax exemption is sought, shall not be
    39  eligible to receive benefits pursuant to this section.
    40    4. (a) (i) For a period of twelve years from the approval of an appli-
    41  cation, the increase in assessed value of such property attributable  to
    42  such conversion shall be exempt as provided in subparagraph (ii) of this
    43  paragraph.  Such  exemption  shall  be  computed  with  respect  to  the
    44  "exemption base". The exemption base shall be determined for  each  year
    45  in  which  there  is  an increase in assessed value so attributable from
    46  that of the previous year's assessed value.
    47    (ii) The following table shall illustrate the computation of  the  tax
    48  exemption:

    49        Year of exemption                      Percentage of exemption

    50            1 through 8                        100% of exemption base
    51            9                                  80% of exemption base
    52            10                                 60% of exemption base
    53            11                                 40% of exemption base
    54            12                                 20% of exemption base
        S. 2316                             3

     1    (b) No such exemption shall be granted unless:
     2    (i)  such conversion was commenced subsequent to the date on which the
     3  municipality's local law took effect; [and]
     4    (ii) the cost of such conversion  exceeds  the  sum  of  ten  thousand
     5  dollars or such greater amount as may be specified by local law[.];
     6    (iii) at least seventy-five percent of the floor area of the mixed-use
     7  property consists of the pre-existing building or structure; and
     8    (iv)  the  portion  of  the  building  used for commercial purposes is
     9  currently, as demonstrated by documentation submitted by the  applicant,
    10  used as such or is in good faith contemplated.
    11    (c) For purposes of this section the term conversion shall not include
    12  ordinary maintenance and repairs.
    13    (d)  No  such exemption shall be granted concurrent with or subsequent
    14  to any other real property tax exemption granted to  the  same  improve-
    15  ments to real property, except, where during the period of such previous
    16  exemption,  payments in lieu of taxes or other payments were made to the
    17  local government in an amount that would have been equal to  or  greater
    18  than the amount of real property taxes that would have been paid on such
    19  improvements  had  such  property  been granted an exemption pursuant to
    20  this section. In such case, an exemption shall be granted for  a  number
    21  of  years  equal  to  the twelve year exemption granted pursuant to this
    22  section less the number of years the property would have been previously
    23  exempt from real property taxes.
    24    5. Such exemption shall be granted only upon application by the  owner
    25  of  such  real  property  on a form prescribed by the commissioner. Such
    26  application shall be filed with the  assessor  of  the  municipality  or
    27  county having the power to assess property for taxation on or before the
    28  appropriate taxable status date of such municipality or county.
    29    6.  If  the assessor is satisfied that the applicant is entitled to an
    30  exemption pursuant to this section, he or she shall approve the applica-
    31  tion and such real property shall be exempt from taxation and special ad
    32  valorem levies as in this section provided. The assessed  value  of  any
    33  exemption  granted  pursuant  to  this  section  shall be entered by the
    34  assessor on the assessment roll with  the  taxable  property,  with  the
    35  amount of the exemption shown in a separate column.
    36    7.  (a)  During  the period of exemption pursuant to this section, the
    37  owner shall submit an annual certification  to  the  assessor  attesting
    38  that  the  property complies with the provisions or requirements of this
    39  section and any additional provisions or requirements as may be provided
    40  by local law. Failure to submit such certification shall result in revo-
    41  cation of benefits. Such certification shall include at  a  minimum  the
    42  following:
    43    (i)  the  types  of  residential  use and the total above-grade square
    44  footage [and below-grade square footage] of such use;
    45    (ii) the types of commercial use  and  the  total  above-grade  square
    46  footage [and below-grade square footage] of such use;
    47    (iii) attestation that the portion of the building used for commercial
    48  purposes is currently, as demonstrated by documentation submitted by the
    49  applicant,  used as such or is in good faith contemplated [to be used as
    50  such]; and
    51    (iv) [the specific address of the entrance through  which  the  public
    52  enters the portion of the building used for commercial purposes;
    53    (v)  if the portion of the building intended to be used for commercial
    54  purposes is not currently in active use for such purposes  and  open  to
    55  the  public,  the reasons why it is not currently being used for commer-
    56  cial purposes and open to the public; and
        S. 2316                             4

     1    (vi)] all such other information required by the municipality.
     2    (b)  If  the  assessor is satisfied that the applicant continues to be
     3  entitled to the exemption pursuant to this section, the  assessor  shall
     4  approve the certification and the real property shall remain exempt from
     5  taxation  and  special ad valorem levies for another year as provided in
     6  this section.
     7    8. (a) The benefits of this section shall be revoked upon a finding by
     8  the assessor that:
     9    (i) the application for benefits hereunder or the annual certification
    10  required hereunder contains a false statement or false information as to
    11  a material matter or omits a material matter; or
    12    (ii) the eligible real property fails to comply with one  or  more  of
    13  the  provisions  or  requirements  of  this section or any provisions or
    14  requirements provided by local law[; or
    15    (iii) the portion of the property devoted to commercial  purposes  has
    16  not  been  in  active use for commercial purposes and open to the public
    17  for three consecutive years].
    18    (b) Such revocation shall require the repayment of any benefits previ-
    19  ously granted pursuant to this section [for any year  during  which  the
    20  property  was  non-compliant  or the application or annual certification
    21  contained a false statement or false information as to a material matter
    22  or omitted a material matter.
    23    (c) No benefits may be revoked unless the  applicant  has  been  given
    24  thirty  days'  notice  of  such revocation and has been given reasonable
    25  notice to cure any failure to comply with the provisions of requirements
    26  of this section].
    27    9. If the assessor determines that there was a  material  misstatement
    28  in  an  application filed by or on behalf of the owners for an exemption
    29  pursuant to this section and that such misstatement provided  the  basis
    30  for  the  granting  of such exemption, the municipality shall proceed to
    31  impose a penalty on the applicant of one thousand dollars in addition to
    32  recovering the amount of any prior exemption granted.
    33    § 2. This act shall take effect January 1, 2024  and  shall  apply  to
    34  properties  for which the initial application for exemption are received
    35  on and after such date.