Provides that county assessors are to classify all property on assessment rolls into three classes and local laws may provide different rates for the classes

2) the revaluation commission is to take all necessary steps for implementation of the revaluation, but shall have no authority to review the valuation or exempt status of any individual parcel as established by an assessor or board of assessment review;

3) the revaluation commission is to cease to exist upon completion of the revaluation;

4) the revaluation is to be entered on the first final assessment roll to be completed on or after August 1st of the third calendar year following the adoption, by the county, of the local law;

5) valuation data is to be provided to each assessing unit by the county as part of the revaluation program;

6) each assessing unit within the county is to adopt an assessment roll with full value assessments thereon;

7) each assessing unit is to conduct an update of assessments every five years thereafter;

8) all real property in each assessing unit is to be valued at its full value as of the first day of January of the year preceding the year in which the initial revaluation is implemented, and on the first day of January in every fifth year thereafter;

9) assessments may be challenged on the grounds of inequality only if the county has determined that an assessing unit is not in compliance with the full value standard, and such determination, if timely challenged by the assessing unit, is upheld on appeal, or the complainant demonstrates by clear and convincing evidence that the assessing unit is not in compliance with the full value standard;

10) the State Board is to establish identical equalization rates for all of the assessing units in the county;

11) if an assessing unit files a complaint with respect to a tentative equalization rate, it must also serve a copy of the complaint upon all other assessing units in the county;

12) any assessing unit may support, object to, or express an opinion on a complaint filed by another assessing unit, by filing a written statement with the State Board on or before the date on which the complaint is scheduled to be heard;

13) any change made to the tentative equalization rate is to apply to all of the assessing units in the county;

14) if any assessing unit petitions for judicial review of a final equalization rate, it must also serve a copy of its petition upon all other assessing units in the county;

15) any change made to a final equalization rate as a result of a judicial review is to apply to all of the assessing units in the county;

16) generally, taxes will be levied based upon the assessed value of property, without apportionment or equalization;

17) the county is to review assessment rolls to determine whether the assessing unit is in compliance with the full value standard of assessment;

18) where the county determines that the assessing unit is in compliance with the full value standard of assessment, a percentage of 100% is to be used for the equalization of assessments of special franchise property, assessments of taxable state land, railroad ceilings and any other assessment, ceiling, exemption or value for which any statute requires application of a state equalization rate;

19) where the county determines that an assessing unit is not in compliance with the full value standard of assessment, the county, after consulting with the assessing unit, may request the public official having custody of the assessment roll or any tax levying body to take any actions necessary to provide for an equitable apportionment of taxes;

20) an assessing unit that does not agree with the county's determination may request further review of the matter by the municipal compliance appeals panel;

21) the municipal compliance appeals panel is comprised of five members each being a resident of a different assessing unit in the county;

22) any municipal corporation adversely affected by any action, or lack of action, by the action or any determination by the municipal compliance appeals panel, may seek review by the state board;

23) the standard of review by the state board is whether the action taken resulted in a fair and equitable apportionment of taxes;

24) the assessor of each assessing unit within the county is to classify all real property on each assessment roll into three classes: - class one is all one, two, and three family residential property, all residential condominium property and vacant property zoned residential; - class two is all other residential real property, except hotels and motels and other similar commercial property; - class three is all other real property which is not designated as class one or class two;

25) a municipal corporation may adopt a local law, without referendum, providing that the taxes of such municipal corporation are to be allocated among the real property classes using class tax rates; provided however that a school district which is wholly contained within a town or city shall adopt the class tax rates in accordance with the inter-class relationships prescribed by the city or town;

26) a municipal corporation determines class tax rates by determining the current percentage of taxable assessed value of each class on the assessment roll and adjusting those percentages subject to statutory limitations. Those limitations include the option of applying a

Homeowner Protection Factor which would prevent the shift of tax burden from the commercial class to the residential class;

27) the class tax rates allow the municipal corporation to shift a portion of the tax burden from class one and class two to class three and thereby protect against a post revaluation shift of tax burden from commercial property to residential property;

28) condominiums classified within class one are to be given a restricted assessment value (i.e., subject to the assessment restriction limitations of RPTL § 581 and Real Property Law § 339-Y) and unrestricted assessed value (market value);

29) a municipal corporation which levies taxes using the classified tax rate system is to levy taxes against the unrestricted assessed value of the condominium and a municipal corporation which does not use the classified tax rate system is to levy taxes against the restricted assessed value;

30) the local law adopted by the county to implement the provisions of Article 17 may also provide for a transitional exemption from taxation, for any parcel which receives an increase in assessment above the change in level of assessment which occurs due to the revaluation;

31) the transitional exemption is to be phased out over a four year period;

32) state assistance is to be available to Westchester County if it implements the provisions of Article 17 in the form of a one-time payment of up to ten dollars per parcel;

33) a municipal corporation which is wholly or partially in Westchester County, may increase the maximum income eligibility level for purposes of the senior citizens exemption (RPTL §467) if the median per capita income in such county exceeds the median per capita income of the State as a whole;

34) A special partial exemption of 30% up to $35,000 shall be allowed on all property, except condominiums which benefit from a restricted assessment pursuant to RPTL 339-Y; and

35) The assessment on a parcel of property may be reviewed a maximum of two times within the five year cycle.

Summary of specific provisions

Section 301 of the RPTL provides that all real property shall be valued as of the first day of January preceding taxable status date.

Section 305(2) of the RPTL provides, in pertinent part, that "all real property shall be assessed at a uniform percentage of value (fractional assessment)."

Section 467 of the RPTL provides an exemption to senior citizens of limited income. The maximum income to receive the full exemption is $17,500.

Section 581 of the RPTL and section 339-Y of the Real Property Law provide for the restricted assessments of condominium property. Essentially, they require that the sum of the assessments of the individual condominium units must not exceed the value of the entire complex if it was sold as a single entity. Equalization rates are established pursuant to Article 12 of the RPTL for each city, town and village in the state for purposes of tax apportionment, state aid to education, proof of ration in certiorari proceedings, calculation of certain exemptions and assessments, and tax and debt limits. Section 1572-a of the RPTL provides for state assistance to municipalities participating in a consolidated assessing unit created pursuant to RPTL §1602, and to each assessing unit participating in a coordinated assessment program pursuant to §579 of the RPTL. The aid is in the form of a one-time payment of up to $10 per parcel to each constituent municipality.

Article 19 of the RPTL authorizes a classified tax system for assessing units completing revaluations or updates and becoming certified as approved assessing units. The two class (homestead and non-homestead) tax rates are based upon class shares (base proportions) as they existed prior to the revaluation or update.

Justification

The Real Property Tax Law requires local tax authorities to conduct annual valuations of real property for assessment purposes. Historically, this mandate has been a virtual impossibility to fulfill. Even with the advent of electronic data processing techniques, annual valuations are considered impractical and not cost effective. As a result, revaluations in Westchester and throughout the State have been conducted in infrequent and diverse cycles, certainly not each year.

Real property tax administration should be credible, predictable and understandable. Although the periodic examination of valuations is necessary, adherence to the mandate of annual valuations is impractical at best and most often ignored. This widespread and continuing violation of State law undermines the credibility of the real property tax system.

This bill authorizes Westchester County to adopt a cooperative real property tax administration system. This local option system provides that the initial county-wide revaluation program is to be paid for by the county. Under this system all real property is to be valued on a five year cycle.

The bill sets forth numerous provisions to encourage local governments to adopt this system. These provisions include:

* a simplified equalization process due to the adoption of a full value standard of assessment throughout the county;

* limitation of most certiorari and small claims proceeding to two times during the five year evaluation cycle;

*elimination of ratio as an issue in most assessment review proceedings (administrative and judicial);

* an optional classified tax system to protect certain classes of property that would otherwise experience significant shifts in tax burden as a result of the revaluation;

* an optional transitional exemption provision to phase in the impact of the revaluation for property owners that had been under assessed prior to the revaluation;

* an optional enhanced senior citizens exemption where the median per capita income in the county, exceeds the median per capita income of the State as a whole; and

* State assistance payable in a one-time payment of up to $10 per parcel to Westchester County if it implements this system.

The bill will improve real property tax administration by providing incentives for local government to voluntarily adopt a system which requires the periodic update of assessments on a five year cycle. PRIOR LEGISLATIVE HISTORY : A.11060 (1997-98), A.6979 (1999-2000), A.1405 (2001-02), A.1576 (2003-04), A1326 (2006).

Fiscal implications

The initial cost of the revaluation program is to be a County expense. However, that can be offset to some extent by State assistance available pursuant to Section 1572 of the RPTL. Further, any county which implements the new Article 17 would also receive additional State aid in the amount of $10 per parcel. This State aid program is similar to that established in Section 1572-a of the RPTL for consolidated assessing units and assessing units participating in a coordinated assessment program. There would also be a reduction in litigation costs for local governments, since most certiorari and small claims proceedings would be limited to one time during the five year cycle.

Finally, there would be a reduced cost for State equalization due to the full value standard set forth in the new Article 17 and the establishment of identical equalization rates for all of the assessing units in the county.

Effective date

Immediately.