N.Y. Real Property Tax Law § 485-a: Residential-commercial urban exemption program

§ 485-a. Residential-commercial urban exemption program. 1.

Definitions. As used in this section, the following terms shall have

the following meanings:

(a) "Municipality" means any town, city or village except for a city

having more than one million inhabitants.

(b) "Applicant" means any person obligated to pay real property taxes

on the property for which an exemption from real property taxes under

this section is sought.

(c) "Commercial construction work" means the modernization,

rehabilitation, expansion or other improvement of the portion of

mixed-use property to be used for commercial purposes.

(d) "Commercial purpose or use" means (i) the buying, selling or

otherwise providing of goods or services directly to the public; or (ii)

a non-residential lawful use including, but not limited to, an office,

hotel, retail store, brewery, distillery, restaurant, cafe, bar or

tavern, gymnasium, theater, or entertainment venue which employs or is

anticipated to employ a minimum of five employees primarily at the

mixed-use property for which an exemption under this section is sought.

(e) "Mixed-use property" means property on which will exist, after

completion of residential construction work or a combination of

residential construction work and commercial construction work, a

building or structure used for both residential and commercial purposes

of which, at least forty percent of the building or structure's square

footage is devoted to residential purposes or use and at least fifteen

percent of the building or structure's square footage is devoted to

commercial purposes or use.

(f) "Person" means an individual, corporation, limited liability

company, partnership, association, agency, trust, estate, foreign or

domestic government or subdivision thereof, or other entity.

(g) "Residential construction work" means the creation, modernization,

rehabilitation, expansion or other improvement of dwelling units, other

than dwelling units in a hotel, in the portion of mixed-use property to

be used for residential purposes.

(h) "Story above grade" means any story having its finished floor

surface entirely above grade.

(i) "Grade" shall mean the finished ground level adjoining the

building at all exterior walls.

2. Any municipality may, by local law, provide for the exemption of

real property from taxation as provided in this section. Upon the

adoption of such a local law, the county in which such municipality is

located may, by local law, and any school district, all or part of which

is located in such municipality, may, by resolution, exempt such

property from its taxation in the same manner and to the same extent as

such municipality has done.

3. Upon the adoption of such a local law, non-residential real

property, upon conversion to mixed-use property, shall be exempt from

taxation and special ad valorem levies as provided for in subdivision

four of this section.

4. (a) (i) For a period of twelve years from the approval of an

application, the increase in assessed value of such property

attributable to such conversion shall be exempt as provided in

subparagraph (ii) of this paragraph. Such exemption shall be computed

with respect to the "exemption base". The exemption base 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.

(ii) The following table shall illustrate the computation of the tax

exemption:

Year of exemption Percentage of exemption

1 through 8 100% of exemption base

9 80% of exemption base

10 60% of exemption base

11 40% of exemption base

12 20% of exemption base

(b) No such exemption shall be granted unless:

(i) such conversion was commenced subsequent to the date on which the

municipality's local law took effect; and

(ii) the cost of such conversion exceeds the sum of ten thousand

dollars or such greater amount as may be specified by local law.

(c) For purposes of this section the term conversion shall not include

ordinary maintenance and repairs.

(d) No such exemption shall be granted concurrent with or subsequent

to any other real property tax exemption granted to the same

improvements to real property, except, where during the period of such

previous exemption, payments in lieu of taxes or other payments were

made to the local government in an amount that would have been equal to

or greater than the amount of real property taxes that would have been

paid on such improvements had such property been granted an exemption

pursuant to this section. In such case, an exemption shall be granted

for a number of years equal to the twelve year exemption granted

pursuant to this section less the number of years the property would

have been previously exempt from real property taxes.

5. Such exemption shall be granted only upon application by the owner

of such real property on a form prescribed by the commissioner. Such

application shall be filed with the assessor of the municipality or

county having the power to assess property for taxation on or before the

appropriate taxable status date of such municipality or county.

6. If the assessor is satisfied that the applicant is entitled to an

exemption pursuant to this section, he or she shall approve the

application and such real property shall be exempt from taxation and

special ad valorem levies as in this section provided. The assessed

value of any exemption granted pursuant to this section shall be entered

by the assessor on the assessment roll with the taxable property, with

the amount of the exemption shown in a separate column.

7. (a) During the period of exemption pursuant to this section, the

owner shall submit an annual certification to the assessor attesting

that the property complies with the provisions or requirements of this

section and any additional provisions or requirements as may be provided

by local law. Failure to submit such certification shall result in

revocation of benefits. Such certification shall include at a minimum

the following:

(i) the types of residential use and the total above-grade square

footage and below-grade square footage of such use;

(ii) the types of commercial use and the total above-grade square

footage and below-grade square footage of such use;

(iii) attestation that the portion of the building used for commercial

purposes is currently, as demonstrated by documentation submitted by the

applicant, used as such or is in good faith contemplated to be used as

such;

(iv) the specific address of the entrance through which the public

enters the portion of the building used for commercial purposes;

(v) if the portion of the building intended to be used for commercial

purposes is not currently in active use for such purposes and open to

the public, the reasons why it is not currently being used for

commercial purposes and open to the public; and

(vi) all such other information required by the municipality.

(b) If the assessor is satisfied that the applicant continues to be

entitled to the exemption pursuant to this section, the assessor shall

approve the certification and the real property shall remain exempt from

taxation and special ad valorem levies for another year as provided in

this section.

8. (a) The benefits of this section shall be revoked upon a finding by

the assessor that:

(i) the application for benefits hereunder or the annual certification

required hereunder contains a false statement or false information as to

a material matter or omits a material matter;

(ii) the eligible real property fails to comply with one or more of

the provisions or requirements of this section or any provisions or

requirements provided by local law; or

(iii) the portion of the property devoted to commercial purposes has

not been in active use for commercial purposes and open to the public

for three consecutive years.

(b) Such revocation shall require the repayment of any benefits

previously granted pursuant to this section for any year during which

the property was non-compliant or the application or annual

certification contained a false statement or false information as to a

material matter or omitted a material matter.

(c) No benefits may be revoked unless the applicant has been given

thirty days' notice of such revocation and has been given reasonable

notice to cure any failure to comply with the provisions of requirements

of this section.

9. If the assessor determines that there was a material misstatement

in an application filed by or on behalf of the owners for an exemption

pursuant to this section and that such misstatement provided the basis

for the granting of such exemption, the municipality shall proceed to

impose a penalty on the applicant of one thousand dollars in addition to

recovering the amount of any prior exemption granted.