Relates to the eligibility of J-51 tax abatements to reflect cost of living adjustments

1 Co-sponsor

• Jeffrey D. Klein

Title of bill

An act to amend the real property tax law, in relation to the eligibility for J-51 tax abatements to reflect cost of living adjustments

Purpose or general idea of bill

To adjust the J-51 tax abatement minimum assessed property value eligibility to reflect yearly changes in cost of living.

Summary of specific provisions

Section 1. Amends Subdivision 17 of section 489 of the real property tax law regarding eligibility for benefits of subdivision 17. In this subdivision, cooperatively owned buildings or condominiums whose value exceeds the assessed valuation limitation specified in subdivision 17, paragraph (c) shall only be eligible for the benefits of subdivision 17 if alterations or improvements for which the dwelling, building, or structure that applied for the benefits, were carried out with substantial government assistance.

Subdivision 17, paragraph (c) assessed value limitation: for the final assessment rolls completed prior to 2018, the assessed value limitation shall be $30,000.

For the final assessment roll to be completed in 2018, the assessed value limitation shall be the previously applicable limitation -$30,000 - increased by the cost-of-living adjustment percentage of 2017.

The cost-of-living adjustment percentage shall be equal to the "applicable increase percentage" used by the US Commissioner of Social Security to determine the monthly social security benefits paid to individuals in 2018.

For every year after 2018, the applicable assessed value limitation, cost-of-living adjustment percentage and applicable increase percentage shall all be advanced by one year, and the assessed valuation limitation shall be the previously applicable limitation, increased by the new cost-of-living adjustment percentage.

If there is no applicable increase because the general benefit has increased as defined by 42 U.S.C. 415(i), then the applicable increase percentage will be the percentage, which would have yielded that general benefit increase.

Section 2 contains the effective date.

Justification

The J-51 tax abatement is a property tax exemption and abatement received by buildings for renovating a residential apartment building. Since 1992, co-op units and condos that had an assessed value less than $40,000 were eligible to receive this abatement. However, in 2013, the eligibility cap was reduced to units that have an assessed value of less than $30,000. As a result of this change, fewer middle-income coops and condo owners are eligible for these abatements.

This bill would increase the J-51 tax abatement cap yearly to reflect adjustments in the cost of living, as set by the U.S. commissioner of social security in determining monthly benefits. Therefore, the abatement cap would be indexed for inflation and will consistently accommodate middle income co-op and condo owners.

Prior legislative history

New Bill.

Fiscal implications

To be determined.

Effective date

This act shall take effect immediately.