Relates to payments in lieu of taxes

BILL NUMBER:S7738

Title of bill

An act to amend the general municipal law and the education law, in relation to payments in lieu of taxes.

Purpose or general idea of bill

This bill amends the general municipal law and education law to provide that the tax base growth factor (or quantity change factor) include the value of new assessment exempted under a Payment In Lieu of Taxes agreement being added to a community.

Summary of specific provisions

Section 1 amends section 3-c of the general municipal law to include the change in assessed value for each property on the exempt side of the tax rolls under PILOT agreements when the commissioner of taxation and finance calculates the quantity change factor for each local government.

Section 2 amends section 2023-a of the education law to provide that the change in assessed value for each property on the exempt side of the tax rolls under PILOT agreements is included when the commissioner of taxation and finance calculates the quantity change factor for each local government.

Section 3 provides an effective date one hundred twenty days after enactment.

Justification

The new tax cap law ignores increases to the tax base of a community if that increase in tax base occurs under a PILOT agreement. The mechanics of the law take into account the payment of PILOTs in a comprehensive manner, whereby each dollar of "new" PILOT payments made reduces the amount of tax an entity can levy by a dollar. In other words, the law sets the Property Tax and PILOT payments cap b y fixing a maximum levy amount after netting out the effects of any PILOT payments received. The issue is that the real property improvements made under a PILOT are not counted under the law in the Tax Base Growth Factor - the intent of which is to ensure that as a community grows, so too should its revenues because that community is providing services to more residents and businesses. By ignoring PILOT-exempted projects, the law does not properly capture this phenomenon and a community cannot expand its resources in proportion to service demand increases. These issues can be resolved by amending the law to have the quantity change factor include the value of new assessment exempted under a PILOT agreement being added to a community.

Prior legislative history

New Legislation

Fiscal implications

None

Effective date

This act shall take effect on the hundred twentieth day after it shall have become law provided that the amendments to section 3-c of the general municipal law and section 2023-a of the education law made by

sections one and two of this act, respectively, shall not affect the repeal of such sections and shall be deemed repealed therewith.