BILL NUMBER:S2544                REVISED 01/12/12

TITLE OF BILL:
An act
to amend the real property tax law, in relation to the exemption from
taxation for non-profit organizations and to repeal certain provisions
of such law relating thereto

PURPOSE:
To ensure that exempt properties are being used in the manner which
supports the specific exemption granted.

SUMMARY OF PROVISIONS:
Repeals subdivision 3 of section 420-a of the real property tax law to
add a new subdivision 3 to provide that vacant or otherwise
unimproved land shall only be deemed tax exempt if there are definite
plans for utilizing and adapting the property for exempt purposes
within five years and the full execution of such plans within seven
years.

EXISTING LAW:
Existing law does not provide a date certain by which real property
not in actual use for its exempt purpose(s) must be developed or
otherwise improved to facilitate such activity.

JUSTIFICATION:
              

Land-banking Occurs when tax exempt organizations purchase land for
contemplated use. The problem is that often times contemplated use
does not occur or takes years to occur. While that land is tied up,
taxes are not being paid, and the land is not being put to productive
use. This diminishes the overall tax base of a locality.
When the tax base of a locality is diminished, the remaining taxpayers
burden increases. This makes home ownership less affordable as
property taxes grow.

This proposed measure is one of a series of bills aimed at
restructuring the framework for granting real property tax exemptions
across the state. Based on year 2000 assessment rolls, there are over
five million parcels of property in New York State (valued at a total
of 1.3 trillion dollars). Of this number, some three million parcels
enjoy at least 1 real property tax exemption. From a taxable status
standpoint, about 1/3 of the total value of property in New York
State (441 billion dollars) is either wholly or partially exempt from
real property taxation.

The lion's share of real property tax exemptions (around 68%) 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.

It is imperative that the State address and limit exemptions to those
organizations and purposes which most broadly benefit the public.
This specific legislation promotes this thrust by ensuring that
organizations seeking tax exemptions truly meet those public
purposes, and that lands receiving relief from real property taxation
are being fully used in support of such purposes.

LEGISLATIVE HISTORY:
S.6838  of 2010: Referred to Local Government
S.1126A of 2003: Referred to Local Government

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,
municipal and special district (i.e., fire protection) tax rolls.

EFFECTIVE DATE:
This act would take effect on the first of January next succeeding the
date on which it shall have become a law and would apply to
assessment rolls prepared on the basis of taxable status dates
occurring on or after such date.