N.Y. Real Property Tax Law § 485-h: Residential investment exemption; certain cities

§ 485-h. Residential investment exemption; certain cities. 1.

Residential real property constructed on or after the first day of July,

two thousand three in cities with a population of not less than

thirty-one thousand and not more than thirty-two thousand may be exempt

from city taxation and special ad valorem levies as provided in this

section.

2. (a) (i) Such real property shall be exempt for a period of one year

to the extent of fifty per centum of the increase in assessed value

thereof attributable to such construction and for an additional period

of nine years provided, however, that the extent of such exemption shall

be decreased by five per centum each year during such additional period

of nine years and such exemption shall be computed with respect to the

"exemption base". The exemption base shall be the increase in assessed

value as determined in the initial year of such ten year period

following the filing of an original application, except as provided in

subparagraph (ii) of this paragraph.

(ii) In any year in which a change in level of assessment of fifteen

percent or more is certified for a final assessment roll pursuant to the

rules of the commissioner, the exemption base shall be multiplied by a

fraction, the numerator of which shall be the total assessed value of

the parcel on such final assessment roll (after accounting for any

physical or quantity changes to the parcel since the immediately

preceding assessment roll), and the denominator of which shall be the

total assessed value of the parcel on the immediately preceding final

assessment roll. The result shall be the new exemption base. The

exemption shall thereupon be recomputed to take into account the new

exemption base, notwithstanding the fact that the assessor receives the

certification of the change in level of assessment after the completion,

verification and filing of the final assessment roll. In the event the

assessor does not have custody of the roll when such certification is

received, the assessor shall certify the recomputed exemption to the

local officers having custody and control of the roll, and such local

officers are hereby directed and authorized to enter the recomputed

exemption certified by the assessor on the roll. The assessor shall give

written notice of such recomputed exemption to the property owner, who

may, if he or she believes that the exemption was recomputed

incorrectly, apply for a correction in the manner provided by title

three of article five of this chapter for the correction of clerical

errors.

(iii) The following table shall illustrate the computation of the city

tax exemption:

Year of exemption Percentage of exemption

1 50

2 45

3 40

4 35

5 30

6 25

7 20

8 15

9 10

10 5

(b) No such exemption shall be granted unless:

(i) such construction was commenced on or after the first day of

January, two thousand three or such later date as may be specified by

local law;

(ii) the residential real property is situate in a city with a

population of not less than thirty-one thousand and not more than

thirty-two thousand;

(iii) the cost of such construction exceeds the sum of thirty thousand

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

(iv) such construction is completed as may be evidenced by a

certificate of occupancy or other appropriate documentation as provided

by the owner.

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

include ordinary maintenance and repairs.

3. 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 a city with a population

of not less than thirty-one thousand and not more than thirty-two

thousand on or before the appropriate taxable status date of such city

and within one year from the date of completion of such construction.

4. 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 thereafter be exempt from

taxation and special ad valorem levies by a city with a population of

not less than thirty-one thousand and not more than thirty-two thousand

as provided in this section commencing with the assessment roll prepared

after the taxable status date referred to in subdivision three of this

section. 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.

5. The provisions of this section shall apply to real property used as

the primary residence of the owner.

6. In the event that real property granted an exemption pursuant to

this section ceases to be used primarily for eligible purposes, the

exemption granted pursuant to this section shall cease.

7. A city with a population of not less than thirty-one thousand and

not more than thirty-two thousand may, by local law, reduce the per

centum of exemption otherwise allowed pursuant to this section;

provided, however, that a project in course of construction and

exemptions existing prior in time to passage of any such local law shall

not be subject to any such reduction so effected. Such city upon

reduction of the per centum of exemption pursuant to this subdivision

may thereafter, by local law, increase the per centum of exemption up to

any per centum not exceeding the maximum allowed by subdivision two or

eleven of this section, whichever is applicable, provided, however, that

any such local law shall apply only to construction commenced subsequent

to the effective date of such local law. A copy of all such local laws

shall be filed with the commissioner and the assessor of the city.

8. A city with a population of not less than thirty-one thousand and

not more than thirty-two thousand may, by local law, establish a date

for the commencement of effectiveness of exemption offered pursuant to

this section and may provide that the provisions of this section shall

apply only to construction having a greater value than that specified by

subdivision two of this section, provided, however, that such amount

shall not exceed seventy thousand dollars.

9. (a) A city with a population of not less than thirty-one thousand

and not more than thirty-two thousand may, by local law, establish a

board to be known as the residential incentive board. The membership and

composition of such board shall be set forth in the local law.

(b) The residential incentive board shall present a plan to the

legislative body of a city with a population of not less than thirty-one

thousand and not more than thirty-two thousand concerning the various

types of residential real property which should be granted eligibility

for an exemption pursuant to subdivision one of this section. Such plan

shall make a recommendation as to whether the exemption be computed as

provided in subdivision two or eleven of this section. In addition, such

plan shall identify specific geographic areas within which such

exemptions should be offered. In developing the plan required by this

paragraph, the board shall consider the planning objectives of a city

with a population of not less than thirty-one thousand and not more than

thirty-two thousand, the necessity of the exemption to the attraction or

retention of home owners and the economic benefit to the area of

providing exemptions to home owners.

(c) In addition, the board may make recommendations to the legislative

body of a city with a population of not less than thirty-one thousand

and not more than thirty-two thousand with respect to actions it deems

desirable to improve the economic climate therein.

10. If a city with a population of not less than thirty-one thousand

and not more than thirty-two thousand establishes a residential

incentive board, pursuant to subdivision nine of this section, such city

may, by local law, restrict real property eligible to receive the

exemption to real property constructed for those purposes identified in

the plan presented by the board. Such local law shall restrict the

availability of such exemption to the specific geographic areas

identified in the plan presented by the board.

11. Notwithstanding subdivision two of this section, where a city with

a population of not less than thirty-one thousand and not more than

thirty-two thousand adopts restricted exemptions pursuant to subdivision

ten of this section, the local law may provide that such exemptions

shall be computed pursuant to the following accelerated strategic

exemption schedule:

Year of exemption Percentage of exemption

1 50

2 45

3 40

4 35

5 30

6 25

7 20

8 15

9 10

10 5

Provided however, that such local law shall:

(i) contain findings that the adoption of this accelerated strategic

exemption schedule is necessary to encourage targeted residential

development, and that the value of the exemptions to be provided is

justified by the need to broaden the tax base; and

(ii) limit the applicability of such schedule to projects where the

cost of such construction exceeds the sum of seventy thousand dollars;

and

(iii) provide that such exemptions are restricted by geographic areas

as provided by subdivision ten of this section.