N.Y. General Municipal Law § 696: Tax incentives

§ 696. Tax incentives. Upon the consent of the governing body of any

municipality in which an urban development action area project is or is

to be located, the real property of a project may be exempted from local

and municipal taxes, other than assessments for local improvements and

land value, to the extent of all or part of the value of the improvement

included in such project, for a period of twenty years from the first

date on which taxes otherwise would become due in the absence of the

exemption, during the last ten years of which the exemption shall be

decreased in equal annual or biennial decrements according to a formula

established by the governing body at the time it gives its consent to

the tax exemption, pursuant to this section. If the project consists of

new construction, the land value for purposes of determining exemptions

permitted by this section shall be the lesser of the assessed valuation

immediately prior to commencement of construction or the assessed

valuation of the land appearing on the assessment roll in the first year

after completion of construction. Such exemption may only be made

available where the urban development action area project includes the

construction of a new structure or the renovation, rehabilitation or

conversion of an existing structure where the cost of such renovation,

rehabilitation or construction is at least equal to one hundred percent

of the assessed value of such structure as determined in the tax year

immediately preceding the governing body's grant of tax exemption to

such project. Any lease of real property and appurtenances thereto for a

period not exceeding twenty years shall require payments to the

municipality in lieu of taxes. Such additional payments shall be

required to be in equal annual or biennial escalating amounts over the

life of any lease for a period not exceeding twenty years so as to

ensure that payments in lieu of taxes made during the final year of such

lease shall be equal to all local and municipal taxes. All renewals of

any lease shall include provision for payment of rental and in lieu of

tax payments greater than or equal to those required during the final

year of the original lease. Any lease of real property and appurtenances

thereto for a period in excess of twenty years but not exceeding

ninety-nine years shall require payments in lieu of taxes. Such payments

shall commence in the tenth year of such lease and increase in equal

annual or biennial amounts until the twentieth year so that such

payments commencing in the twenty-first year and continuing until the

conclusion of the lease shall be equal to all local and municipal taxes.