Since 1990, the Council of New York Cooperatives &
Condominiums and its Action Committee for Reasonable Real
Estate Taxes have worked for fair treatment of all New York
City taxpayers. The acknowledged disparity between the taxes
paid by home owners in cooperatives and condominiums and
other New York City home owners has been bridged in part
by an abatement program enacted in 1996 and extended three
times so that it is now in place through June 30, 2008.
The Summer 2004 issue of the CNYC Newsletter celebrated
the four-year extension of the abatement program and recapped
its history and the role of the Action Committee in keeping
this issue before our lawmakers. Profuse thanks were extended
to the sponsors of the legislation, Assemblyman Pete Grannis
and State Senator Frank Padavan, for ensuring that this
extender was signed into law early enough to allow the abatement
to continue seamlessly. Earlier extenders had not been passed
until much later in the year, forcing cooperatives and condo
unit owners to pay full property tax bills in July and October
of those years, without benefit of abatement.
The City administration and the City Council have been
strongly committed to this program, which provides an abatement
of 25% on the property taxes of home owners owning no more
than three apartments in a cooperative or condominium where
the assessed value averages $15,000 or less per unit, and
17.5% abatements in for home owners in cooperatives and
condominiums with higher assessed values.
The abatement program has been significant in mitigating
some of the glaring discrepancies in the tax treatment of
home owners in cooperatives and condominiums as compared
to home owners in one-, two- and three-family homes in property
tax Class 1.
The two-tiered character of the abatement program contributes
significantly toward further fairness by according a higher
rate of abatement (25%) to buildings with lower assessed
values. In 1996, when the $15,000 breakpoint was established,
it appropriately enhanced the abatements of a significant
percentages of cooperatives and condominiums that were the
homes of people of modest means. In the intervening years,
however, as assessments have increased, many of the buildings
originally receiving the 25% abatement have crossed over
the mark of $15,000 in average assessment per unit. Unfortunately,
this afflicts them with higher taxes at the same time that
their abatement lowers to 17.5%. The City Council has explored
the possibility of adjusting the abatement equation to rectify
this situation. This may be a necessary intermediate step
while work continues on a permanent plan for tax fairness.
ABATEMENTS ALONE
CANNOT RESOLVE
ALL INEQUITIES
However, by its nature, this abatement program can only
paint with broad brushstrokes. In addition to bridging the
huge gap that remains between the treatment of Class 1 homes
and home owners in cooperatives and condominiums, there
is also the task of correcting large disparities in the
assessment of similar cooperatives and condominiums in different
parts of the city. This cannot be accomplished through the
current abatement program. Rather, it will require a more
extensive modification of the property tax system.
The 2004 legislation had required the City of New York
to develop a long-term plan for tax fairness. The Department
of Finance is reported to be working on such a plan. CNYC
and the Action Committee seek to participate in reviewing
whatever proposals are put forward.
S.T.A.R. INFO IS
REBATE DATA SOURCE
For the second year in a row, the City of New York has returned
to home owner tax payers a refund of up to $400 as thanks
for the huge property tax increase that was implemented
in January 2003, necessary to the recovery of the City after
the events of September 11, 2001. The bulk of the rebate
checks were sent out early in October; with smaller groups
scheduled to be mailed in November and December. The School
Tax Relief program (STAR) provided the data that enabled
the City to identify qualifying home owners.
While cooperatives are responsible for updating the information
that the Department of Finance uses to process the property
tax abatement program for their buildings, individuals must
apply for STAR on their own. STAR is available only on one’s
primary residence in New York State. Once registered, you
will continue to receive STAR benefits each year. To register,
call 311 and ask for the STAR program. Seniors with a family
income of less than $60,000 can qualify for Enhanced STAR
benefits. Recipients of Enhanced STAR must submit their
financial information annually to confirm their qualification.