WHY IT IS SO EXPENSIVE TO PAINT A WATER TANK…BOARD RESOLUTION SUPPORTING 3 YEAR PHASE IN FOR REASSESSMENT…ASKING NYS TO INCREASE INCOME ELIGIBILITY FOR SENIOR EXEMPTIONS…REASONS WE REJECTED 1904…COPIES OF LETTERS FROM ATTORNEY FROM NEW YORK STATE OFFICE OF REAL PROPERTY TAX SERVICES INDICATING THAT 1904 IS INEFFECTIVE AND TOWN WOULD LOSE FINANCIAL ASSISTANCE FROM STATE IF WE HAD ENACTED 1904
Earlier this week I sent out an e mail blast which highlighted some of our water district infrastructure needs. I received a bunch of e mails and calls from residents asking why it’s so expensive to paint a water tank. This is the explanation: The district has 6 tanks. They all need rehabilitation to keep them serviceable. Painting a water tank (inside and out) is a very big task, involving blasting clean to remove all the old paint, capturing all the paint and blast media, performing welding repairs, adding some equipment in the tanks, and doing all in a timely fashion as the window of opportunity is tight. On average, about 2 million per tank.
Two years ago we went to bid. I was shocked at how expensive the paint job bid submission was. The Town Board rejected the bid. We re-bid the water tank paint job. The results: Still disappointed at how expensive it is to paint a tank!
The Town Board approved the following resolution last night detailing the reassessment 3 year phase in that the Board hopes that the New York State Legislature will authorize for the town of Greenburgh to enact. We have been in contact with state officials discussing this proposal.
TB-1 – 04/27/16
RESOLUTION OF THE TOWN BOARD OF THE TOWN OF GREENBURGH
REQUESTING THAT THE NEW YORK STATE LEGISLATURE AUTHORIZE
THE TOWN BOARD TO PHASE IN POST-REASSESSMENT PROPERTY
TAXES SO QUALIFIED OWNERS OF CERTAIN RESIDENTIAL REAL
PROPERTY WHO HAVE HAD A PROPERTY TAX INCREASE AS A DIRECT
RESULT OF THE TOWN-WIDE REASSESSMENT MAY HAVE THE
INCREASES PHASED IN OVER A THREE YEAR PERIOD
WHEREAS, on February 26, 2014, the Town Board authorized Tyler Technologies to conduct a
town-wide reassessment of the approximately 28,000 properties in the Town; and
WHEREAS, a town-wide reassessment was deemed necessary since reassessment had not
previously been conducted in the town since the mid 1950’s, resulting in assessment inconsistencies,
widespread lack of public confidence in the system and an inordinate number of assessment appeals; and
WHEREAS, the recently completed town-wide reassessment has resulted in substantial property
tax increases and decreases for a large number of property owners in the town; and
WHEREAS, the Town Board finds it necessary to phase in property tax increases over a short
period of time, instead of immediately, to assist qualified property owners whose 2016 property tax
assessments have increased substantially as a result of the reassessment; and
WHEREAS, the Town Board, based on the unambiguous opinions received from the NYS Office
of Real Property Tax Services stating that Section 1904 of the New York State Real Property Tax Law is
ineffective as a remedy to assist property owners whose 2016 property assessments have increased
substantially as a result of reassessment;
NOW, THEREFORE, BE IT RESOLVED, that the Town Board of the Town of Greenburgh
hereby requests that the New York State Legislature authorize the Town Board to phase in over a three
year period property tax changes resulting from the Town’s town-wide reassessment, and to limit property
tax increases over the transition period for qualified owners of certain residential real property provided
the following conditions are met:
Σ A timely filed complete application must be filed with the Town Assessor (no fee)
Σ Applies solely to 1, 2 or 3 family residences (not applicable to condominiums/cooperatives/apartments)
Σ Residence must have a Certificate (or Temporary) Certificate of Occupancy
Σ Residence must be primary residence of owner
Σ Owner must be receiving STAR (basic or enhanced)
Σ The property is not transferred during the phase-in. If transferred, total increase is fully implemented.
Σ Interior inspection is conducted
Σ Property use or classification does not change during the transition period
Σ Property tax increase is not due to site or building improvements done without required permits
Σ Property tax increase is not due to lost exemptions
Σ Owner(s) is current in all property tax payments
Σ Any other NYS legislature recommended conditions are met
AND, BE IT FURTHER RESOLVED, during the three year phase in period property taxes shall
be adjusted to ensure the phase-in is revenue neutral to school, fire, town, county, and any other
applicable taxing district in the Town of Greenburgh.
The Town Board approved the following resolution last night urging the state to increase the income level for seniors to qualify for partial property tax exemptions. It’s difficult for anyone to live in Westchester if you make only $37,000 a year!
TB-2 – 04/27/16
RESOLUTION URGING THE NEW YORK STATE LEGISLATURE TO
INCREASE THE INCOME LEVEL FOR SENIOR CITIZENS TO QUALITY FOR
PARTIAL PROPERTY TAX EXEMPTION FROM $37,399.99 TO $49,999.99
PURSUANT TO REAL PROPERTY TAX LAW SECTION 467
BE IT RESOLVED, the Town Board of the Town of Greenburgh hereby urges the New York
State Legislature to increase the income level for senior citizens to quality for partial property tax
exemption from $37,999.99 to $49,999.99 pursuant to RPTL Section 467.
The Town Board voted to reject 1904. We received two letters from an attorney for the state highlighting why 1904 is ineffective and has never been enacted into law by any community in NYS. In addition- if the town had enacted 1904 we would have been penalized and would not have received NYS financial assistance –helping us pay for some of the reassessment costs (would have lost six figures!)
TB-3 – 04/27/16
RESOLUTION REJECTING A PROPOSED LOCAL LAW WHICH SOUGHT TO
AMEND ARTICLE XII OF CHAPTER 440 OF THE CODE OF THE TOWN OF
GREENBURGH ENTITLED "PROPERTY REASSESSMENT" BY CREATING A
NEW SUBSECTION 440-67.1 ENTITLED "TRANSITIONAL ASSESSMENTS"
TO ALLOW THE TOWN ASSESSOR TO PHASE IN THE NEW 2016
ASSESSMENTS OVER A FIVE YEAR PERIOD, INSTEAD OF IMMEDIATELY,
PURSUANT TO SECTION 1904 OF THE NEW YORK STATE REAL PROPERTY
TAX LAW, A SECTION WHICH THE NYS OFFICE OF REAL PROPERTY TAX
SERVICES HAS RECENTLY DEEMED “LARGELY INEFFECTIVE”
BE IT RESOLVED, having adopted Resolutions TB-1 – 04/27/16 (requesting NYS approval of a
three year phase-in of post-reassessment property tax changes) and TB-2 – 04/27/16 (requesting a senior
partial tax exemption increase from $37,399.99 to $49,999.99), and having received unambiguous
opinions received from the NYS Office of Real Property Tax Services (ORPTS) stating that Section 1904
of the New York State Real Property Tax Law is “largely ineffective” as a remedy to assist property
owners whose 2016 property assessments have increased substantially as a result of reassessment, the
Town Board of the Town of Greenburgh hereby rejects a proposed Local Law that sought to amend
Article XII of Chapter 440 of the Code of the Town of Greenburgh entitled "Property Reassessment" by
creating a new Subsection 440-67.1 entitled "Transitional Assessments" to allow the Town Assessor to
phase in the new 2016 assessments over a five year period, instead of immediately, pursuant to Section
1904 of the New York State Real Property Tax Law, a section which the NYS ORPTS recently deemed as
“largely ineffective, because it phases in assessment changes, not tax impact changes.”
AND, BE IT FURTHER RESOLVED, Resolution TB-1 – 04/27/16, adopted by the Town
Board on April 27, 2016, proposes to phase in “tax impact changes” in a manner with actually provides a
meaningful phase in of property tax increases resulting from the recent Town-wide reassessment
COPY OF LETTER FROM ATTORNEY FOR NEW YORK STATE OFFICE OF REAL PROPERTY TAX SERVICES STATING THAT 1904 IS INEFFECTIVE AND THAT WE WOULD LOSE FINANCIAL ASSISTANCE
From: tax.sm.ORPTS.Legal [mailto:firstname.lastname@example.org]
Sent: Wednesday, April 13, 2016 9:49 AM
To: Paul Feiner
Cc: Timothy Lewis; Town Board; Edye McCarthy; Wolham, John (TAX)
Subject: RPTL 1904 Transition Assessments
Mr. Feiner – In response to the e-mails you sent me Monday evening concerning the transition assessment option authorized by RPTL § 1904, I stand behind what I said in my letter to Mr. Lewis. All I can add is that the reason that RPTL § 1904 is not effective is that it is based on a faulty premise. The statute assumes that upon implementation of a revaluation, the assessments of underassessed properties will go up, and the assessments of overassessed properties will go down. In fact, only the first half of that assumption is valid; the second half is not.
While it may seem counterintuitive, the fact is that all assessments will increase when this revaluation is implemented, even those of overassessed properties. The reason is that real property in Greenburgh is currently being assessed at a very low percentage of market value, just over 3% according to the latest State equalization rate. Overassessed property is being assessed at a somewhat higher ratio, and underassessed property is assessed at a somewhat lower ratio, but all are far below market value now. Therefore, once they are brought up to market value, they will all experience assessment increases of a very substantial order of magnitude, more than thirtyfold. If transition assessments are in place, they will only serve to phase in the small differences of magnitude that are experienced by different parcels. I will attempt to illustrate this phenomenon with the following example.
Consider three parcels. Assume each parcel is worth $100 and the level of assessment is 3%. Assume one parcel is equitably assessed, one is underassessed by 10% and the other is overassessed by 10%. If the town implements a full value reassessment with transition assessments, the assessment of the underassessed property will immediately go from 90% to 99% of what would be equitable, while the assessment of the overassessed property will immediately go from 110% to 101% of what would be equitable. The remaining 1% is what will be phased in over the next four years. By contrast, if the town were to implement the full value reassessment without transition assessments, all three assessments would immediately go to 100% of what would be equitable. Thus, in this example, the adoption of § 1904 would only serve to phase in 1% of the revaluation’s impact over the five year period, far less than one would expect.
Impact of 1904 on 3 properties each worth $100 Row
A B C D E F G H 2
Pre-reval AV MV Reval AV % Increase Y1 Incrmnt Y1 AV % Eq'ble Asst 3
(D ÷ B) x 100 (D-B) ÷ 5 B+F G ÷ G5 4
Equitably assd 3.0 100 100 3333% 19.40 22.40 100% 5
Underass'd by 10% 2.7 100 100 3704% 19.46 22.16 99% 6
Overass'd by 10% 3.3 100 100 3030% 19.34 22.64 101% 7
is only for
and is not
used in the
I am attaching my spreadsheet for your convenience. You are welcome to attempt simulating the impacts with your own numbers if you like.
-- Joseph K. Gerberg, Associate Attorney
COPY OF A LETTER TO GREENBURGH TOWN ATTORNEY STATING THAT 1904 IS INEFFECTIVE
From: tax.sm.ORPTS.Legal [mailto:email@example.com]
Sent: Wednesday, March 30, 2016 4:27 PM
To: Timothy Lewis
Cc: Edye McCarthy; Town Board
Subject: RE: Section 1904 of the New York State Real Property Tax Law
Mr. Lewis -- I appreciate the challenges the Town is facing as it explores the transition assessment option provided by RPTL section 1904. However, there is little I can offer you by way of specific advice. Transition assessments are not only a local option, but are also entirely administered at the local level. If an assessing unit chooses to avail itself of the provisions of this complex statute, it is also implicitly choosing to accept responsibility for interpreting the law it is choosing to administer. There is nothing in the statute that empowers us to assume that responsibility. To the extent our agency has a formal role under this statute, it is limited to prescribing the form of the assessment roll so that it accommodates transition assessments (which we have done; see 20 NYCRR 8190-1.2(b)(12)(ii) and 8190-1.5(d)), and taking transition assessments into account when determining State equalization rates.
That said, I would be normally happy to share with you what we have learned from working with other assessing units that have dealt with similar issues. Unfortunately, I cannot do so here because to the best of our knowledge, no assessing unit in the State has ever adopted transition assessments upon completing a revaluation. While I cannot say definitively why that is so, I presume that to the extent they were not deterred by the complexity of the statute, their decision was largely the result of two considerations:
1. Section 1904 is largely ineffective, because it phases in assessment changes, not tax impact changes. As a result, the lion’s share of the tax shifts occur in the first year. It might not be obvious why this is so, but it is basically a result of the fact that all parcels are seeing large assessment increases implemented at the same pace. A mathematical simulation should make this phenomenon more apparent.
2. The adoption of section 1904 will render the assessing unit ineligible for reassessment aid, since it necessarily means that the municipality will not be assessing property at full value, which is a prerequisite for receiving that aid. Likewise, the State equalization rate will be well below 100 throughout the transition period, since it must be determined using the (fractional) transition assessments.
In any event, to the best of our knowledge there are no court decisions construing section 1904. That of course is consistent with our understanding that it has never been adopted.
We have no further general observations to offer, and as I indicated earlier, we are not in a position to formally advise you on the specific implementation questions you raised.
One final, very minor comment: I noticed that your letter was addressed to “Office of Real Property Services, State Board of Equalization and Assessment, 16 Sheridan Ave, Albany, New York 12210”. Please be advised that those agency names, and that mailing address, are obsolete. Any future postal mail of a legal nature should be sent to the State Department of Taxation and Finance, Office of Counsel, State Office Campus, Albany, NY 12227. Non-legal postal mail should be addressed to the Department’s Office of Real Property Tax Services (not the Office of Counsel) at either our White Plains or Albany address. Thank you.
-- Joseph K. Gerberg, Associate Attorney
Greenburgh Town Supervisor