What's happening
This bill requires nonprofit property owners to annually prove tax exemption eligibility with clear and convincing evidence, with assessors using new state-issued guidance.
Why it matters
Nonprofit property owners would face stricter scrutiny. They must now prove every year, with "clear and convincing" evidence, that their property truly qualifies for tax exemption, making it harder to retain this benefit by default.
Local tax assessors will have standardized state guidance. This could lead to more consistent decisions across different jurisdictions, reducing confusion or inequity about which nonprofits qualify.
Potential for administrative burden and increased costs. Nonprofits may need to devote more resources to documentation and compliance, which could be especially challenging for smaller organizations with limited staff.
Risk of losing exemptions for some nonprofits. If unable to meet the higher evidentiary standard each year, organizations could lose their property tax exemption, impacting their budgets and potentially reducing their services.
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Who cares
Headline styles
Tighten Nonprofit Tax Exemptions
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to local government
- Referred to local government
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Tighten Nonprofit Tax Exemptions
In Assembly Committee · Real Property Taxation · Sponsor Aileen Gunther
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2606
2019-2020 Regular Sessions
IN SENATE
January 28, 2019
Introduced by Sen. AKSHAR -- read twice and ordered printed, and when printed to be committed to the Committee on Local Government
AN ACT to amend the real property tax law, in relation to the exemption from taxation for non-profit organizations
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 420-a of the real property tax law is amended by adding a new subdivision 17 to read as follows:
17. In all instances, the burden of annually establishing that the requirements of this section have been satisfied shall be upon the owner of the property and must be proven by clear and convincing evidence. The department shall develop, in consultation with not-for-profit organizations and assessors, guidance documents to be used by assessors in determining whether the standard of proof established by this subdivision has been met.
§ 2. This act shall take effect on the first of January next succeeding the date on which it shall have become a law and shall apply to assessment rolls prepared on the basis of taxable status dates occurring on or after such date.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00480-02-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the real property tax law, in relation to the exemption from taxation for non-profit organizations
Purpose
To place the responsibility of annually establishing that a not-for-pro- fit corporation or association is entitled to real property tax exemptions upon such corporation or association.
Summary of provisions
Section 1: Amends section 420-a of the Real Property Tax Law by adding a new subdivision 15 to require that the owner of a property which is tax exempt pursuant to section 420-a of the Real Property Tax Law, prove annually, by clear and convincing evidence, that the requirements of section 420-a have been satisfied. Further, this new subdivision provides that the New York State Department of Taxation and Finance shall develop, in consultation with not-for-profit organizations and assessors, guidance documents which shall be used by assessors to deter- mine whether the standard of proof has been met.
Read the full memo (682 words)
Section 2: Effective date.
Existing law
While not-for-profit corporations or associations must initially seek the granting of an exemption under Section 420-a, they are not required to do so on an annual basis, nor are they regularly compelled to provide convincing evidence that such exemption should continue to apply.
Justification
This proposed measure is one of a series of bills aimed at reconstruct- ing the framework for granting real property tax exemptions across the state. Based on year 2012 assessment rolls, there are over 5.7 million parcels of property in New York State (valued at a total of over $2.5 trillion). Of this number, some 3.5 million parcels enjoy at least 1 real property tax exemption. From a taxable status standpoint, over 32.4% of the total value of property in New York State ($826 billion) is either wholly or partially exempt from real property taxation.
The lion's share of real property tax exemptions are state mandated, and while the state has provided some reimbursement to relieve local taxing jurisdictions (i.e. through the STAR program), high levels of tax exemptions can present a serious burden to other property owners who must support the cost of school district, municipal and special district operations.
The State must help provide tools which promote greater accountability from those seeking real property exemptions in order to balance public needs and benefits. This specific legislation offers such a tool by seeking to ensure that organizations which seek tax exemption truly met those public purposes, and that lands receiving relief from real proper- ty taxation are being fully used in support of such purposes.
Legislative history
S.996 of 2018: Died in Senate Local Government
S.1372 of 2016: Died in Senate Local Government, Died in Assembly Real Property Taxation
S.1372 of 2015: Died in Senate Local Government, Died in Assembly Real Property Taxation
S.878 of 2014: Died in Senate Local Government, Died in Assembly Real Property Taxation
S.878 of 2013: Died in Senate Local Government, Died in Assembly Real Property Taxation
S.2545-A of 2012: Died in Senate Local Government, Died in Assembly Real Property Taxation
S.2545 of 2011: Died in Senate Local Government, Died in Assembly Ways and Means
S.8474 of 2010: Died in Senate Rules
S.478 of 2008: Died on Senate Floor Calendar, Died in Assembly Ways and Means
S.478 of 2007: Died in Senate Local Government, Died in Assembly Real Property Taxation
S.3926 of 2006: Died on Senate Floor Calendar, Died in Assembly Real Property Taxation
S.3926 of 2005: Died on Senate Floor Calendar, Died in Assembly Real Property Taxation
S.1123-A of 2004: Died in Senate Local Government, Died in Assembly Real Property Taxation
S.1123-A of 2003: Died on Senate Floor Calendar
Fiscal implications
None to the state.
Local fiscal implications
Undetermined, however, it is anticipated the bill will offer improved local oversight of exemptions, with a salutary effect on school, munici- pal and special district (i.e. fire protection) tax rolls.
Effective date
This act shall take effect on the first of January next succeeding the date on which it shall have become law and shall apply to assessment rolls prepared on the basis of taxable status dates occurring on or after such date.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.