This bill has been amended

Bill S3872-2013

Provides for the application of the veterans' real property tax exemptions in N.Y. city

Provides for the application of the veterans' real property tax exemptions in cities having a population of one million or more.

Details

Actions

  • Jan 8, 2014: REFERRED TO VETERANS, HOMELAND SECURITY AND MILITARY AFFAIRS
  • Jun 4, 2013: REPORTED AND COMMITTED TO FINANCE
  • Feb 26, 2013: REFERRED TO VETERANS, HOMELAND SECURITY AND MILITARY AFFAIRS

Meetings

Votes

VOTE: COMMITTEE VOTE: - Veterans, Homeland Security and Military Affairs - Jun 4, 2013
Ayes (10): Ball, Carlucci, Flanagan, Golden, Griffo, Grisanti, Zeldin, Addabbo, Avella, Tkaczyk
Ayes W/R (2): Larkin, Gipson
Nays (1): Sanders

Memo

BILL NUMBER:S3872

TITLE OF BILL: An act to amend the real property tax law, in relation to real property tax exemptions for property in cities having a population of one million or more and owned by certain veterans or their family members

PURPOSE: Provides for the application of the veterans' real property tax exemptions in cities having a population of one million or more

SUMMARY OF PROVISIONS:

Section one amends paragraphs 2 and 3 of subdivision 1 of section 458 of the real property tax law, paragraph 2 as amended by chapter 488 of the laws of 1998 and paragraph 3 as amended by chapter 733 of the laws of 1959.

Section two amends subdivisions 2 of section 458 of the real property tax law, as amended by chapter 53 of the laws of 1976.

Section four amends subdivision 2 of section 458-a of the real property tax law.

Section five grants an exemption pursuant to section 458 and 458-a of the real property tax law.

Section six is the effective date.

JUSTIFICATION: The Veterans Property Tax Exemption is different from other property tax breaks in the system. With most exemptions, the exempted value is fully excluded from the property tax. However, with the current Veterans exemption, the exempted value is only partially non-taxable: the property owner must still pay the School Tax Rate on the exempted value.

This School Tax Rate is the share of the Property Tax that pays for public schools (DOE). This means the more money the City pays for its schools, the closer the School Tax Rate will be to the Property Tax Rate. And so the closer the School Tax Rate is to the Property Tax Rate, the less a Veterans Property Tax Exemption will be worth. The School Rate varies from year to year, which causes the relative value of a Veterans Exemption to fluctuate year to year as well. In the last two fiscal years, as the City has increased its local share of spending on DOE in response to reductions in State and Federal education aid, the value of the Veterans Exemption has decreased.

To eliminate these fluctuations in the exemptions value, this bill would make the Veterans Exemption like the others and exempt that value from the School Tax. That means the Veterans Exemption will go from being only partially nontaxable, to fully nontaxable. This would also mean that the value of the exemption would rise consistent with increases in assessed value and/or the appropriate class property tax rate.(1)

In order to maintain the value of the exemption at approximately its recent historical level while fully eliminating taxation of the exempt

portion, the nominal value of the exemption will be set at 40 percent of their current values(2). Thus, a 15% exemption under current law would be set at 6% under the proposed amended law. Chart 1 shows an illustrative example of the value of the exemption under current law and as it would have been under the proposed amendments.

CHART 1 EXAMPLE OF EXEMPTION UNDER CURRENT LAW AND PROPOSED AMENDMENTS

CURRENT LAW PROPOSED 2008 $191 $232 2009 $237 $243 2010 $286 $256 2011 $268 $260 2012 $248 $273

Example based on $15.000 assessed value and 25% exemption (10% under proposed amendment)

FISCAL IMPLICATIONS: Undetermined.

LEGISLATIVE HISTORY: 2012: S.6523-Referred to Finance / A.9377 Referred to Veterans

EFFECTIVE DATE: This act shall take effect immediately and apply to assessment rolls based upon the taxable status date occurring on or after the fifth day of January next succeeding the date on which it shall have become a law.

FOOTNOTES:

(1) Some class tax rates have risen as a function of shifts in the share of total market value of taxable property attributable to the different classes. The individual tax class rates are determined by formula and not by legislative action of the City Councilor the State.

(2) The one exception to this is the "Eligible Funds" exemption for seriously disabled veterans. The value of that exemption will remain unchanged as it is already exempted from the School Tax and therefore needs no reform.


Text

STATE OF NEW YORK ________________________________________________________________________ 3872 2013-2014 Regular Sessions IN SENATE February 26, 2013 ___________
Introduced by Sen. LANZA -- read twice and ordered printed, and when printed to be committed to the Committee on Veterans, Homeland Securi- ty and Military Affairs AN ACT to amend the real property tax law, in relation to real property tax exemptions for property in cities having a population of one million or more and owned by certain veterans or their family members THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraphs 2 and 3 of subdivision 1 of section 458 of the real property tax law, paragraph 2 as amended by chapter 488 of the laws of 1998 and paragraph 3 as amended by chapter 733 of the laws of 1959, are amended to read as follows: (2) Except as provided in subdivision five of this section, no such exemption on account of eligible funds paid on account of military or naval services rendered by an individual shall be allowed in excess of five thousand dollars; PROVIDED, HOWEVER, IN A CITY WITH A POPULATION OF ONE MILLION OR MORE, AN EXEMPTION ON ACCOUNT OF ELIGIBLE FUNDS PAID ON ACCOUNT OF MILITARY OR NAVAL SERVICES RENDERED BY AN INDIVIDUAL SHALL EQUAL FORTY PERCENT OF ELIGIBLE FUNDS, BUT IN NO CASE SHALL SUCH EXEMPTION BE ALLOWED IN EXCESS OF TWO THOUSAND DOLLARS. For the purposes of this subdivision any established exemption, or newly claimed exemption, or an aggregate thereof, as the case may be, in excess of any multiple of fifty dollars shall be regarded as being the nearest multi- ple of fifty dollars and allowed in such amount. If the amount of such exemption has no nearest multiple of fifty dollars, it shall be regarded as being the next higher multiple of fifty dollars and allowed in such amount. The mingling of such eligible funds with other funds or their retention by the United States for insurance premiums shall not bar the granting of a claim for such exemption. (3) If the assessors are satisfied that the applicant is entitled to any exemption, they shall make appropriate entries upon the assessment-
roll opposite the description of such property and subtract the total amount of such exemption from the total amount assessed pursuant to the provisions of paragraph one of this subdivision. Such entries shall be made and continued in each assessment of the property so long as it is exempt from taxation for any purpose. Such real property, to the extent of the exemption entered by the assessors, shall be exempt from state, county and general municipal taxation, but shall be taxable for local school purposes; PROVIDED, HOWEVER, IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, SUCH REAL PROPERTY, TO THE EXTENT OF THE EXEMPTION ENTERED BY THE ASSESSORS, SHALL BE EXEMPT FROM STATE, COUNTY AND GENERAL MUNICIPAL TAXATION AND SHALL NOT BE TAXABLE FOR LOCAL SCHOOL PURPOSES. The provisions herein, relating to the assessment and exemption of prop- erty purchased with eligible funds apply and shall be enforced in each municipal corporation authorized to levy taxes. S 2. Subdivision 2 of section 458 of the real property tax law, as amended by chapter 63 of the laws of 1976, is amended to read as follows: 2. Real property purchased with moneys collected by popular subscription in partial recognition of extraordinary services rendered by any honorably discharged veteran of world war one, world war two, or of the hostilities which commenced June twenty-seventh, nineteen hundred fifty, who sustained permanent disability while on military duty, either total or partial, and owned by the person who sustained such injuries, or by his or her spouse or unremarried surviving spouse, or dependent father or mother, is subject to taxation as herein provided. Such prop- erty shall be assessed in the same manner as other real property in the tax district. At the meeting of the assessors to hear complaints concerning the assessments, a verified application for the exemption of such real property from taxation may be presented to them by or on behalf of the owner thereof, which application must show the facts on which the exemption is claimed, including the amount of moneys so raised and used in or toward the purchase of such property. No exemption on account of any such gift shall be allowed in excess of five thousand dollars; PROVIDED, HOWEVER, IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, NO EXEMPTION ON ACCOUNT OF ANY GIFT SHALL BE ALLOWED IN EXCESS OF TWO THOUSAND DOLLARS. The application for exemption shall be presented and action thereon taken in the manner provided by subdivision one of this section. If no application for exemption be granted, the property shall be subject to taxation for all purposes. The provisions herein, relating to the assessment and exemption of property purchased with moneys raised by popular subscription, apply and shall be enforced in each municipal corporation authorized to levy taxes. S 3. Paragraph (a) of subdivision 1 of section 458-a of the real property tax law, as amended by chapter 179 of the laws of 2006, is amended to read as follows: (a) "Period of war" means the Spanish-American war; the Mexican border period; World War I; World War II; the hostilities, known as the Korean war, which commenced June twenty-seventh, nineteen hundred fifty and terminated on January thirty-first, nineteen hundred fifty-five; the hostilities, known as the Vietnam war, which commenced February twenty- eighth, nineteen hundred sixty-one and terminated on May seventh, nine- teen hundred seventy-five; [and] the hostilities, known as the Persian Gulf conflict, which commenced August second, nineteen hundred ninety; IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, THE HOSTILITIES, KNOWN AS THE IRAQ WAR, WHICH COMMENCED MARCH, TWO THOUSAND THREE; AND IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, THE HOSTILITIES,
KNOWN AS THE AFGHANISTAN WAR, WHICH COMMENCED OCTOBER SEVENTH, TWO THOU- SAND ONE. S 4. Subdivision 2 of section 458-a of the real property tax law, as added by chapter 525 of the laws of 1984, paragraph (a) as amended by chapter 899 of the laws of 1985, paragraph (b) as amended by chapter 473 of the laws of 2004, paragraph (c) as amended by chapter 100 of the laws of 1988, subparagraph (ii) of paragraph (d) as amended by chapter 256 of the laws of 2005 and as further amended by subdivision (b) of section 1 of part W of chapter 56 of the laws of 2010, is amended to read as follows: 2. (a) Qualifying residential real property shall be exempt from taxa- tion to the extent of fifteen percent of the assessed value of such property; provided, however, that such exemption shall not exceed twelve thousand dollars or the product of twelve thousand dollars multiplied by the latest state equalization rate for the assessing unit, or in the case of a special assessing unit, the latest class ratio, whichever is less; PROVIDED, HOWEVER, IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, QUALIFYING RESIDENTIAL REAL PROPERTY SHALL BE EXEMPT FROM TAXATION TO THE EXTENT OF SIX PERCENT OF THE ASSESSED VALUE OF SUCH PROPERTY; PROVIDED, FURTHER, THAT SUCH EXEMPTION SHALL NOT EXCEED FOUR THOUSAND EIGHT HUNDRED DOLLARS OR THE PRODUCT OF FOUR THOUSAND EIGHT HUNDRED DOLLARS MULTIPLIED BY THE LATEST CLASS RATIO, WHICHEVER IS LESS. (b) In addition to the exemption provided by paragraph (a) of this subdivision, where the veteran served in a combat theatre or combat zone of operations, as documented by the award of a United States campaign ribbon or service medal, or the armed forces expeditionary medal, navy expeditionary medal, marine corps expeditionary medal, or global war on terrorism expeditionary medal, qualifying residential real property also shall be exempt from taxation to the extent of ten percent of the assessed value of such property; provided, however, that such exemption shall not exceed eight thousand dollars or the product of eight thousand dollars multiplied by the latest state equalization rate for the assess- ing unit, or in the case of a special assessing unit, the class ratio, whichever is less; PROVIDED FURTHER, THAT, IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, WHERE THE VETERAN SERVED IN A COMBAT THEATRE OR COMBAT ZONE OF OPERATIONS, AS DOCUMENTED BY THE AWARD OF A UNITED STATES CAMPAIGN RIBBON OR SERVICE MEDAL, OR THE ARMED FORCES EXPEDITIONARY MEDAL, NAVY EXPEDITIONARY MEDAL, MARINE CORPS EXPEDITIONARY MEDAL, OR GLOBAL WAR ON TERRORISM EXPEDITIONARY MEDAL, QUALIFYING RESIDENTIAL REAL PROPERTY ALSO SHALL BE EXEMPT FROM TAXATION TO THE EXTENT OF FOUR PERCENT OF THE ASSESSED VALUE OF SUCH PROPERTY; PROVIDED FURTHER, THAT SUCH EXEMPTION SHALL NOT EXCEED THREE THOUSAND TWO HUNDRED DOLLARS OR THE PRODUCT OF THREE THOUSAND TWO HUNDRED DOLLARS MULTIPLIED BY THE CLASS RATIO, WHICHEVER IS LESS. (c) In addition to the exemptions provided by paragraphs (a) and (b) of this subdivision, where the veteran received a compensation rating from the United States veteran's administration or from the United States department of defense because of a service connected disability, qualifying residential real property shall be exempt from taxation to the extent of the product of the assessed value of such property multi- plied by fifty percent of the veteran's disability rating; provided, however, that such exemption shall not exceed forty thousand dollars or the product of forty thousand dollars multiplied by the latest state equalization rate for the assessing unit, or in the case of a special assessing unit, the latest class ratio, whichever is less. For purposes of this paragraph, where a person who served in the active military,
naval or air service during a period of war died in service of a service connected disability, such person shall be deemed to have been assigned a compensation rating of one hundred percent; PROVIDED, HOWEVER, IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, IN ADDITION TO THE EXEMPTIONS PROVIDED BY PARAGRAPHS (A) AND (B) OF THIS SUBDIVISION, WHERE THE VETERAN RECEIVED A COMPENSATION RATING FROM THE UNITED STATES VETER- AN'S ADMINISTRATION OR FROM THE UNITED STATES DEPARTMENT OF DEFENSE BECAUSE OF A SERVICE CONNECTED DISABILITY, QUALIFYING RESIDENTIAL REAL PROPERTY SHALL BE EXEMPT FROM TAXATION TO THE EXTENT OF THE PRODUCT OF THE ASSESSED VALUE OF SUCH PROPERTY MULTIPLIED BY TWENTY PERCENT OF THE VETERAN'S DISABILITY RATING; PROVIDED FURTHER, THAT SUCH EXEMPTION SHALL NOT EXCEED SIXTEEN THOUSAND DOLLARS OR THE PRODUCT OF SIXTEEN THOUSAND DOLLARS MULTIPLIED BY THE LATEST CLASS RATIO, WHICHEVER IS LESS. (d) Limitations. (i) The exemption from taxation provided by this subdivision shall be applicable to county, city, town and village taxa- tion, but shall not be applicable to taxes levied for school purposes; PROVIDED, HOWEVER, IN ANY CITY WITH A POPULATION OF ONE MILLION OR MORE, THE EXEMPTION FROM TAXATION PROVIDED BY THIS SUBDIVISION SHALL BE APPLI- CABLE TO CITY TAXES AND TAXES LEVIED FOR LOCAL SCHOOL PURPOSES. (ii) Each county, city, town or village may adopt a local law to reduce the maximum exemption allowable in paragraphs (a), (b) and (c) of this subdivision to nine thousand dollars, six thousand dollars and thirty thousand dollars, respectively, or six thousand dollars, four thousand dollars and twenty thousand dollars, respectively. Each county, city, town, or village is also authorized to adopt a local law to increase the maximum exemption allowable in paragraphs (a), (b) and (c) of this subdivision to fifteen thousand dollars, ten thousand dollars and fifty thousand dollars, respectively; eighteen thousand dollars, twelve thousand dollars and sixty thousand dollars, respectively; twen- ty-one thousand dollars, fourteen thousand dollars, and seventy thousand dollars, respectively; twenty-four thousand dollars, sixteen thousand dollars, and eighty thousand dollars, respectively; twenty-seven thou- sand dollars, eighteen thousand dollars, and ninety thousand dollars, respectively; thirty thousand dollars, twenty thousand dollars, and one hundred thousand dollars, respectively; thirty-three thousand dollars, twenty-two thousand dollars, and one hundred ten thousand dollars, respectively; thirty-six thousand dollars, twenty-four thousand dollars, and one hundred twenty thousand dollars, respectively. In addition, a county, city, town or village which is a "high-appreciation munici- pality" as defined in this subparagraph is authorized to adopt a local law to increase the maximum exemption allowable in paragraphs (a), (b) and (c) of this subdivision to thirty-nine thousand dollars, twenty-six thousand dollars, and one hundred thirty thousand dollars, respectively; forty-two thousand dollars, twenty-eight thousand dollars, and one hundred forty thousand dollars, respectively; forty-five thousand dollars, thirty thousand dollars and one hundred fifty thousand dollars, respectively; forty-eight thousand dollars, thirty-two thousand dollars and one hundred sixty thousand dollars, respectively; fifty-one thousand dollars, thirty-four thousand dollars and one hundred seventy thousand dollars, respectively; fifty-four thousand dollars, thirty-six thousand dollars and one hundred eighty thousand dollars, respectively; PROVIDED, HOWEVER, A HIGH APPRECIATION MUNICIPALITY THAT IS A SPECIAL ASSESSING UNIT THAT IS A CITY WITH A POPULATION OF ONE MILLION OR MORE, IS AUTHOR- IZED TO ADOPT A LOCAL LAW TO INCREASE THE MAXIMUM EXEMPTION ALLOWABLE IN PARAGRAPHS (A), (B) AND (C) OF THIS SUBDIVISION TO FIFTEEN THOUSAND SIX HUNDRED DOLLARS, TEN THOUSAND FOUR HUNDRED DOLLARS, AND FIFTY-TWO THOU-
SAND DOLLARS, RESPECTIVELY; SIXTEEN THOUSAND EIGHT HUNDRED DOLLARS, ELEVEN THOUSAND TWO HUNDRED DOLLARS, AND FIFTY-SIX THOUSAND DOLLARS, RESPECTIVELY; EIGHTEEN THOUSAND DOLLARS, TWELVE THOUSAND DOLLARS, AND SIXTY THOUSAND DOLLARS, RESPECTIVELY; NINETEEN THOUSAND TWO HUNDRED DOLLARS, TWELVE THOUSAND EIGHT HUNDRED DOLLARS, AND SIXTY-FOUR THOUSAND DOLLARS, RESPECTIVELY; TWENTY THOUSAND FOUR HUNDRED DOLLARS, THIRTEEN THOUSAND SIX HUNDRED DOLLARS, AND SIXTY-EIGHT THOUSAND DOLLARS, RESPEC- TIVELY; TWENTY-ONE THOUSAND SIX HUNDRED DOLLARS, FOURTEEN THOUSAND FOUR HUNDRED DOLLARS, AND SEVENTY-TWO THOUSAND DOLLARS, RESPECTIVELY. For purposes of this subparagraph, a "high-appreciation municipality" means: (A) a special assessing unit that is a city, (B) a county for which the commissioner has established a sales price differential factor for purposes of the STAR exemption authorized by section four hundred twen- ty-five of this title in three consecutive years, and (C) a city, town or village which is wholly or partly located within such a county. S 5. An exemption granted pursuant to section 458 or 458-a of the real property tax law that precedes the effective date of this act shall be calculated on subsequent assessment rolls as if the original exemption had been granted pursuant to the provisions of such section, as amended by this act. S 6. This act shall take effect immediately and apply to assessment rolls based upon the taxable status date occurring on or after the fifth day of January next succeeding the date on which it shall have become a law.

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