Provides alternative real property tax exemptions for active duty members of the armed forces

The current law

Currently, only veterans who meet certain requirements and who have been discharged or released from active military, naval, or air service under honorable conditions qualify for exemptions under the Real Property Tax Law. In order to prove eligibility, an applicant must provide a Certificate of Release or Discharge from Active Duty, a DD-214, to the Assessor along with a copy of the deed to his/her home and the application. Thus, active duty members of the armed forces, having never been discharged or released, generally do not qualify for the real property tax exemption.

Summary of specific provisions

Section one adds a new section that defines "Active duty member of the armed forces." Section two author- izes localities to adopt a local law providing that the real property tax exemption be granted to active duty members of the armed forces.

Section three provides the effective date.

Justification

This legislation will allow the real property tax exemption currently available to veterans to be extended to active duty members of the armed forces thereby correcting an inequity in the current treatment of career military personnel.

Section 458-a of, the Real Property Tax Law provides a partial exemption on residential real property taxes to veterans who served during wartime or received an expeditionary medal, or their spouses, known as the "alternative veterans' exemption." A "veteran" is defined for purposes of the alternative veterans' exemption as a person who served in the active military, naval, or air service during a time of war, or, if service was during peacetime only, who received an expeditionary medal, and who was discharged or released under honorable conditions.

Because of the statutory requirement of discharge or release, active duty personnel are generally not eligible for the exemption with two exceptions. Reservists and National Guardsmen who engage in significant, full-time active duty during a time of war and have been discharged or released are veterans for purposes of section 458-a and keep their veteran status forever even if they are re-activated for an additional tour of duty. After their initial tour of duty is completed, they receive a DD-214, the Certificate of Release or Discharge from Active Duty. They are therefore eligible for the alternative veterans' exemption henceforth.

However, because career members of the armed forces, including both officers and enlisted personnel, are not discharged between tours of duty, they are not eligible for the veterans' exemption until they resign or retire. Thus, there is a dichotomy in the treatment of career military personnel and Reservists or National Guardsmen. (see, 11 Op. Counsel SBRPS No. 58)

Previously, career enlisted personnel received momentary discharges when they reenlisted after their initial contracts expired. These enlisted members would receive a DD-214 covering their prior service whenever they reenlisted or extended their active duty service. Thus, they were eligible for the alternative veterans' exemption even if they immediate- ly reenlisted and extended their active duty service. Several years ago, the State Division of Veterans Affairs changed this procedure to align with the long-followed procedure for career officers which is that officers simply remain on active duty and are not discharged when they extend their, active duty service.

Therefore, no matter how many times an officer or enlisted member of the armed forces completes a tour of duty either in the homeland or in a combat zone such as Iraq or Afghanistan and reenlists during a period of war, they are not eligible for the alternative veterans' exemption because they have never been discharged. (see, 11 Op. Counsel SBRPS No. 58) This is unfair.

This legislation rightfully honors active duty members of the armed forces and recognizes their ongoing sacrifice in the service of their country. Under this legislation, a qualified residential parcel owned by an active duty service member will now be eligible for the regular exemption under section 458-a 2.(a) equal to 15% of its assessed value as well as the additional 1D3 combat exemption under section 458-a 2.(b) if applicable.

Legislative history

New bill.

Fiscal implications

None to the State; municipalities that grant the exemption would shift the tax burden to other property taxpayers in the locality.

Effective date

This act shall take effect on the sixtieth day after it shall become law and shall apply to assessment rolls prepared on the basis of taxable status dates occurring on or after such date.