Establishes a residential-commercial exemption program in certain counties

1 Co-sponsor

• Patrick M. Gallivan

BILL NUMBER:S863B

Title of bill

An act to amend the real property tax law, in relation to establishing a residential-commercial exemption program in certain counties; and providing for the repeal of such provisions upon the expiration thereof

Purpose

This bill establishes a residential-commercial exemption program in Livingston County, New York.

Summary of provisions

Section 1. The real property tax law is amended by adding a new section 485-n to define Residential-commercial exemption programs, applicants, benefit areas, commercial construction work, commercial purpose or use, commercial property, mixed-use property, municipality and residential construction work.

Section 2. Allows any municipality within such county to opt in, through adoption of a local law, to a real property tax abatement program. This abatement program would be offered in a designated benefit area, as identified by the municipality, for properties that are converted, created, modernized, rehabilitated, expanded or otherwise improved.

The properties would be exempt from increase in real property taxes and special ad valorem levies for twelve years.

The tax exemption on the change to assessed value of buildings that have commercial or residential construction work done shall be computed with respect to the exemption base and according to the following schedule:

YEAR OF EXEMPTION PERCENTAGE OF EXEMPTION 1 through 8 100% of exemption base 9 80% of exemption base 10 60% of exemption base 11 40% of exemption base 12 20% of exemption base

Justification

The County of Livingston has requested to have legislation enacted that will benefit the County of Livingston and all Towns, Villages and School Districts within the county, by allowing them to grant real property tax abatement in defined redevelopment areas.

This initiative came out of a meeting involving all local taxing entities in the county in 2009. They all agreed to support legislation that authorized the adoption of this tax abatement program by each taxing body at local option in recognizance of the need to effect real investment in revitalization.

The municipalities in Livingston County recognize the need for targeted revitalization and seek authorization at the state level for this.

Tax abatements are a proven technique for local governments to attract investors for revitalization. A tax abatement, which this bill does, is different than a strict tax exemption. A tax exemption takes away existing revenue generated by a property, while a tax abatement does not change existing tax payments. With tax abatements, governments agree to take less than 100% of new revenue generated through property investment, repair and renovation.

This legislation will provide a tool for local governments to use to improve their communities. The proposed tax abatement program will not impose a cost upon the state, and therefore should be considered by the Legislature as a no-cost, mandate-free way to allow local governments in Livingston County to invest in and attract outside investment to their communities.

Legislative history

2010: S.7904/A.11356 Referred to Local Government

Fiscal implications

None.

Effective date

Effective immediately, and shall expire and be deemed repealed twelve years after such date.