Provides for the assessment of real property in cities having a population of one million or more, which was damaged by a severe storm on October 29 - 30, 2012

Summary of provisions

Section one of this bill adds a new section 1805-a to the Real Property Tax Law to authorize New York City to limit increases in the assessed value of certain class one, class two and class four properties. The properties that will be subject to the limitations in this section must satisfy the following conditions:

1. The Department of Finance reduced the assessed value of the building on the property on the assessment roll completed in 2013 from the assessed value on the assessment roll completed in 2012 as a result of damage caused by Hurricane Sandy.

2. The Department of Finance increased or will increase the assessed value of the building on the property as a result of the repair or reconstruction of damage caused by Hurricane Sandy on any assessment roll completed from 2014 through 2020.

For properties that satisfy these conditions and have not performed repairs or reconstruction as of the assessment roll completed in 2015, the physical increase to their assessed value as a result of repairs or reconstruction that will be performed will be limited to the amount of the physical decrease reflected on the assessment roll completed in 2013. Any increase in excess of the amount of the physical decrease reflected on the assessment roll completed in 2013 will be treated as an equalization (non-physical) increase and subject to the limitations for equalization increases prescribed in sections 1805(1) and 1805(2) of the Real Property Tax Law. The assessed values of the properties that satisfy the requisite conditions will not be higher than they would have been but for Hurricane Sandy. For class four and larger class two properties subject to transitional assessments, the limitation on physical increases will apply to the lower of the actual assessed value or the transitional assessed value.

For properties that satisfy these conditions and have already performed repairs or reconstruction that constitute a physical increase reflected on an assessment roll completed as of 2015, the assessed value as it appeared on the assessment roll completed in 2015 will be recalculated as if section 1805-a had been in effect. The Department of Finance is authorized to correct the 2015/2016 assessed value in accordance with section 1805-a within ninety days of the effective date of a local law adopting these provisions. Subsequent physical increases reflected on an assessment roll completed from 2016 through 2020 will also be subject to the limitations described in the

preceding paragraph. To the extent that the square footage used to determine the assessed value of the building on the property on a given assessment roll exceeds that reflected on the assessment roll completed in 2012, the bill provides that the Department of Finance will recalculate the limitation on physical increases by multiplying it by the percentage of the excess square footage of the building.

Section two provides that the bill shall take effect immediately.

Justification

In its report, "One City, Rebuilding Together: A Report on the City of New York's Response to Hurricane Sandy and the Path Forward," the City set forth a number of policies to streamline the recovery process and prioritize rebuilding. The policies outlined in the report included, but were not limited to, improving the experience of homeowners navigating the preconstruction process, enhancing coordination amongst city, state and federal partners, and engaging local communities in the rebuilding process. Notably, the report also recommended providing additional financial relief to homeowners. This legislation continues the City's commitment to do that. This bill would provide real property tax relief to New York City residents who have already repaired or rebuilt properties that were damaged by Hurricane Sandy or who will repair or rebuild properties through fiscal year 2020. Even if the repair or rebuilding merely restores a building to its condition prior to the storm, the assessed value, and therefore the real property taxes, of some of these properties will be higher after the rebuilding than it was prior to the storm. Last year the City provided an abatement to owners who had rebuilt their properties and whose property taxes were higher in fiscal year 2015 than in fiscal year 2013. The abatement, however, provided only temporary relief and did not address the long-term negative impact on assessed values of properties that are rebuilt. In order to further assist these property owners, this bill authorizes New York City to enact a local law limiting the amount that assessed values can increase as a result of the repair or rebuilding of properties severely damaged by Hurricane Sandy.

The amount of increase in assessed value will be limited to the amount that it would have increased if Hurricane Sandy had not occurred for affected property which, for purposes of this legislation, includes certain class one, class two and class four properties. In the event that the repair or rebuilding resulted in an increase in the square footage of the affected property, the bill provides that the Department of Finance will adjust the limitation on increases in assessed value by the percentage that is attributable to the excess square footage of the property.

As the worst natural disaster ever to hit the City of New York, Hurricane Sandy cost forty-four New Yorkers their lives. Many more residents lost homes or businesses, and entire communities were sent reeling by the storm's devastating impact. There is a great deal more work to do to help the hardest-hit communities get back on their feet and we must continue to be vigilant in marshaling City resources to provide relief to those who need it most.

Unfortunately, the statutory real property tax assessment structure does not contemplate the unique circumstance that many property owners find themselves in as a result of Hurricane Sandy: that these property owners would, in effect, suffer a tax penalty for rebuilding their storm-torn properties.

This legislation provides an absolutely necessary measure of relief to owners of class one, class two and class four properties who begin the rebuilding process to return to normalcy.

Effective date

Immediately.