Relates to the development of joint municipal economic development areas in the city of Gloversville and the town of Johnstown and provides for the determination of property tax rates for property owners in such areas.
BILL NUMBER: S1655
TITLE OF BILL : An act to amend chapter 148 of the laws of 2001, relating to authorizing the city of Gloversville and the town of Johnstown to enter into certain cooperative agreements, in relation to joint municipal economic development areas
PURPOSE : To enable the City of Gloversville and the Town of Johnstown to create joint municipal economic development areas in which the City provides certain services to properties in the Town and the two municipalities share the resulting property tax, sales tax and other revenues.
SUMMARY OF PROVISIONS : The bill amends Chapter 148 of the Laws of 2001, which authorizes tax-sharing agreements between the City of Gloversville and the Town of Johnstown, both of which are located in Fulton County. Specifically, the amendments:
- provide that, where a property owner has agreed to participate in a joint municipal economic development area, such property shall be taxed at the rate established by the agreement between the two municipalities;
- provide that the agreement shall specify the amount of the property tax rate, or the formula for determining the rate, that will apply to properties within the joint municipal economic development area;
- allow the property tax rate to be set at a percentage of the city or town rate, or to be set by such other method as agreed to by the municipalities; and
- provide that the agreement shall establish a process for entering into binding agreements between the City, Town and the participating property owner.
EXISTING LAW : Chapter 148 of 2001 authorized the City of Gloversville and the Town of Johnstown to enter into an agreement in which the City would provide water and other services to certain properties in the Town, and the two municipalities would agree to share the resulting property tax, sales tax and other revenues. The law specified certain items that must be included in the agreement, such as establishing a process for identifying affected properties, identifying the types of taxes to be shared, specifying the percentage of revenues each municipality shall receive, and specifying the process for collecting and sharing the revenues.
JUSTIFICATION : In 2001, legislation was enacted to enable the City of Gloversville and the Town of Johnstown to develop a tax sharing agreement in exchange for the provision of certain City services to properties in the Town.
In accordance with the law, local officials developed a proposal in which City water would be provided to certain commercial properties in the Town in exchange for a 50-50 split of any resulting sales tax and property tax. However, the agreement did not receive approval from the City Council. Concerns had been raised that the deal would make locations in the Town more attractive than locations within the City, while generating only minimal revenues to the City. Because the Town tax rate was significantly lower than the City tax rate, splitting the property tax revenue would result in minimal revenues to the City.
Beginning in 2007, local officials decided to revisit the issue, especially in light of the potential for future economic development opportunities along the City-Town border. In order to address previous concerns, local officials recognized that it was appropriate to establish a higher property tax rate in the Town for properties that would be receiving certain City services, such as public water. This would provide a more equitable arrangement for the two municipalities.
This bill would specifically authorize and empower the City and the Town to set a tax rate for affected properties that is in between the current City rate and the Town rate. The bill also clarifies and specifies that the municipal agreement shall establish the process for entering into binding agreements between the two municipalities and property owners who choose to participate in a Joint Municipal Economic Development Area.
This legislation seeks to foster municipal cooperation and economic growth in these two communities. By working together, both municipalities will be in a position to benefit from future growth.
LEGISLATIVE HISTORY : S.7643/A.11469-A of 2008 (passed Senate/Assembly Cities Committee) S.8123 of 2008 (passed Senate)
FISCAL IMPLICATIONS : None to the State. It is expected that, by working together, both the City of Gloversville and the Town of Johnstown will benefit from future growth and development.
EFFECTIVE DATE : Immediately.
STATE OF NEW YORK ________________________________________________________________________ S. 1655 A. 4421 2009-2010 Regular Sessions S E N A T E - A S S E M B L Y February 4, 2009 ___________IN SENATE -- Introduced by Sen. FARLEY -- read twice and ordered print- ed, and when printed to be committed to the Committee on Local Govern- ment IN ASSEMBLY -- Introduced by M. of A. BUTLER -- read once and referred to the Committee on Cities AN ACT to amend chapter 148 of the laws of 2001, relating to authorizing the city of Gloversville and the town of Johnstown to enter into certain cooperative agreements, in relation to joint municipal econom- ic development areas THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Chapter 148 of the laws of 2001, relating to authorizing the city of Gloversville and the town of Johnstown to enter into certain cooperative agreements, is amended to read as follows: Section 1. Notwithstanding any other provision of law, the city of Gloversville and the town of Johnstown are hereby authorized and empowered to enter into agreements with each other
[whereby]TO ESTAB- LISH JOINT MUNICIPAL ECONOMIC DEVELOPMENT AREAS, IN WHICH the city may agree and commit to provide water and other services, INCLUDING SEWER, to properties in the town and, in exchange, the city and town may agree and commit to share all or a specified part of the resulting property tax, sales tax and any other specified taxes generated from such proper- ties. S 2. Any such agreement, or any amendments to the agreement, must be approved by each municipality by a majority vote of the voting strength of its governing body. At least thirty days prior to voting on any such agreement or amendments to the agreement, each municipality shall hold a public hearing on the proposal. S 3. When any service to be provided involves an independent municipal corporation, the agreement shall also require the participation andEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD07448-01-9 S. 1655 2 A. 4421
approval of such municipal corporation by a majority vote of the voting strength of its governing body. S 4. Any such agreement shall: (i) establish a process for ENTERING INTO A BINDING AGREEMENT BETWEEN THE CITY, TOWN AND A PARTICIPATING PROPERTY OWNER FOR identifying and determining the affected properties or boundaries THAT WILL BE PART OF A JOINT MUNICIPAL ECONOMIC DEVELOPMENT AREA; (ii) identify the types of taxes to be shared; (iii) specify the percentage of tax revenues that each municipality shall receive, or otherwise establish a formula or other means for determining the amount of tax revenues each municipality shall receive; (iv) SPECIFY THE AMOUNT OF THE PROPERTY TAX RATE, OR THE FORMULA FOR DETERMINING THE PROPERTY TAX RATE, THAT WILL APPLY TO PROPERTIES WITHIN THE JOINT MUNICIPAL ECONOMIC DEVELOPMENT AREA; SUCH RATE MAY BE SET AT A PERCENTAGE OF THE CITY RATE, OR A PERCENTAGE OF THE TOWN RATE, OR SUCH OTHER METHOD AS AGREED TO BY THE MUNICIPALITIES; (V) specify the process and method of collecting and sharing such tax revenues; and
[(v)](VI) address any other matters as determined to be necessary or appropriate by the city and town. S 5. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, WHERE A PROPERTY OWNER HAS AGREED TO PARTICIPATE IN A JOINT MUNICIPAL ECONOMIC DEVELOP- MENT AREA, SUCH PROPERTY SHALL BE TAXED AT THE RATE ESTABLISHED BY AN AGREEMENT ENTERED INTO PURSUANT TO THIS ACT. S 6. This act shall take effect immediately. S 2. This act shall take effect immediately.