Relates to environmental restoration investigation projects upon parcels in tax lien foreclosure proceedings

BILL NUMBER:S5054A

Title of bill

An act to amend the environmental conservation law, in relation to environmental restoration investigation projects upon parcels in tax lien foreclosure proceedings

Purpose or general idea of bill

To grant the City of New York authority to perform environmental restoration investigations for certain properties in foreclosure.

Summary of specific provisions

Section 1 amends section 56-0508 of the environmental conservation law to add a new subdivision 1-a to allow, in a foreclosure proceeding brought by an entity that has acquired a tax lien, the city of New York to move obtain temporary incidents of ownership to a parcel for the sole purpose of entering the parcel to conduct an environmental restoration investigation of such property.

Section 2 amends subdivision 5 of section 56-0508 of the environmental conservation law to provide that the cost of the investigation would be added to the taxes owed to the City and shall be separate from the tax lien in foreclosure.

Section 3 sets forth the effective date.

Justification

Uncertainty about contamination and contamination levels is the main challenge to reinvestment in contaminated or potentially contaminated tax delinquent properties. To address this problem, section 56-0508 of the Environmental Conservation Law authorizes a court in a proceeding to foreclose a tax lien to grant temporary incidents of ownership to a taxing district for the sole purpose of entering the property to conduct an environmental restoration investigation. When the investigation is complete, the taxing district files the final report of the investigation with the court within thirty days and adds the cost of the investigation to the tax lien, thereby allowing a local government to recoup its investigation costs. For a technical reason, New York City cannot use section 56-0508 to conduct site investigations of tax lien properties. As currently written, section 56-0508 applies only to taxing districts that foreclose on tax liens. Rather than foreclose directly on tax liens, the City sells tax liens to a trust that forecloses on the liens.

The amendment proposed in this bill would put the City in a position comparable to that of all other local governments across the State of New York. The information from a site investigation would reveal the extent of property contamination and approximate remediation costs, substantially reducing the uncertainty over the cost to redevelop a tax lien property. With this information, the City and the entity that holds the tax lien will have confidence that the property can be auctioned to a new owner who will be able to remediate environmental damage and proceed with appropriate redevelopment of the property, bringing it back into productive use and minimizing any long-term hazard.

Prior legislative history

New bill.

Fiscal implications

None to New York State.

Effective date

This act shall take effect immediately and shall apply to any tax lien purchased on or after such date.