Senate Bill S664

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                    664
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                                (PREFILED)
 
                              January 8, 2025
                                ___________
 
 Introduced  by  Sens.  SKOUFIS,  GOUNARDES,  KRUEGER  --  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 assessment and
   taxation of lessees and users of certain tax exempt property

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivision 12 of section 102 of the real property tax  law
 is amended by adding a new paragraph (k) to read as follows:
   (K)  THE  POSSESSORY  INTEREST OF A PRIVATE LESSEE OR CONTRACTOR WHICH
 USES REAL PROPERTY OWNED BY THE UNITED STATES OR THE STATE OF NEW  YORK,
 EXCEPT  REAL  PROPERTY  OWNED  BY PUBLIC AUTHORITIES, WHERE THE PROPERTY
 WOULD BE SUBJECT TO REAL PROPERTY TAXATION IF OWNED BY  SUCH  LESSEE  OR
 CONTRACTOR,  EXCEPT  WHERE  THE  USE  IS BY WAY OF A CONCESSION WHICH IS
 AVAILABLE FOR THE USE OF THE GENERAL PUBLIC AND IS LOCATED IN  OR  ADJA-
 CENT  TO A PUBLIC AIRPORT, PARK, MARKET, FAIRGROUND, ROAD, PIER, MARINA,
 RAILROAD, BUSLINE, SUBWAY OR SIMILAR PROPERTY WHICH IS AVAILABLE FOR THE
 USE OF THE GENERAL PUBLIC.
   § 2. The section heading and subdivision 1 of section 402 of the  real
 property tax law are amended to read as follows:
   United  States  or  state  property  held  under LEASE OR contract [of
 sale].  1.  Whenever the legal title of real property is in  the  United
 States,  or  in  the  state  of  New  York,  but  the use, occupation or
 possession thereof is in a person, partnership,  association  or  corpo-
 ration,  OR  THEIR OR ITS SUCCESSOR IN INTEREST, under a LEASE, contract
 [of sale], OPTION or other agreement [whereby a  right  to  acquire  the
 premises  through  an  option,  a  first privilege or a first refusal is
 granted, or whereby upon one or more payments the legal title thereto is
 to be or may be acquired by such  person,  partnership,  association  or
 corporation],  [his]  SUCH  THAT  THE  INTEREST IS A POSSESSORY INTEREST
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD02203-01-5
 S. 664                              2
 
 DESCRIBED IN PARAGRAPH (K) OF SUBDIVISION TWELVE OF SECTION ONE  HUNDRED
 TWO  OF  THIS CHAPTER, THEIR or its interest in such real property shall
 be assessed and taxed [as] FOR THE SAME AMOUNT AND TO THE SAME EXTENT AS
 THOUGH  THE LESSEE, CONTRACTOR OR USER WERE THE OWNER OF SUCH real prop-
 erty and shall be entered in the assessment roll in the same  manner  as
 if  such  person, partnership, association or corporation held the legal
 title to such property, except for the addition to  the  description  OF
 THE  PROPERTY  OF THE NAME OF THE OWNER AND of the words "INTEREST UNDER
 LEASE", "interest under contract", "interest  under  option",  or  other
 appropriate  words  descriptive  of  the  interest  in  the  property so
 assessed.  [Such assessment shall be at the full value  of  such  inter-
 est.]
   §  3.  Subdivision  2  of  section 402 of the real property tax law is
 amended to read as follows:
   2. [The assessors shall  add  to  the  assessment  roll  opposite  the
 description  of any such interest a notation stating that the real prop-
 erty itself so owned by the United States, or by the state, is not to be
 taxed.  Every notice of sale or other process and  every  conveyance  or
 other  instrument  affecting  the title to any such property, consequent
 upon the non-payment of any such tax, shall  contain  a  statement  that
 such  legal  title is not sold or to be sold or affected] TAXES SHALL BE
 ASSESSED TO THE LESSEES, CONTRACTORS OR USERS OF SUCH REAL PROPERTY  AND
 COLLECTED IN THE SAME MANNER AS TAXES ASSESSED TO OWNERS OF REAL PROPER-
 TY,  EXCEPT  THAT  SUCH  TAXES  SHALL NOT BECOME A LIEN AGAINST THE REAL
 PROPERTY OF THE UNITED STATES OR OF THE STATE OF  NEW  YORK.  WHEN  DUE,
 SUCH  TAXES  SHALL  CONSTITUTE  A  DEBT  DUE  AND OWING FROM THE LESSEE,
 CONTRACTOR OR USER TO THE MUNICIPAL CORPORATION OR SPECIAL DISTRICT  FOR
 WHICH  THE  TAXES  WERE  LEVIED  AND  SHALL  BE RECOVERABLE BY ACTION IN
 SUPREME COURT.
   § 4. Section 402 of the real property tax law is amended by adding two
 new subdivisions 4 and 5 to read as follows:
   4. POSSESSORY INTERESTS, AS DESCRIBED IN PARAGRAPH (K) OF  SUBDIVISION
 TWELVE OF SECTION ONE HUNDRED TWO OF THIS CHAPTER, SHALL ONLY BE TAXABLE
 AS  PROVIDED  IN  THIS  SECTION  IF  THE GOVERNING BODY OF THE MUNICIPAL
 CORPORATION IN WHICH THE POSSESSORY INTERESTS ARE LOCATED, AFTER  PUBLIC
 HEARING,  ADOPTS  A  LOCAL  LAW,  ORDINANCE  OR RESOLUTION SO PROVIDING,
 PROVIDED, HOWEVER, THE PROVISIONS OF THIS SECTION SHALL NOT BE  APPLICA-
 BLE  WHERE  A  POSSESSORY  INTEREST  IS MAKING PAYMENTS IN LIEU OF TAXES
 WHICH PAYMENT IS EQUAL TO THE TAXES THAT WOULD BE PAID HAD THE  PROPERTY
 BEEN  TAXABLE.  ANY  SUCH LOCAL LAW, ORDINANCE OR RESOLUTION SHALL APPLY
 ALIKE TO ALL POSSESSORY INTERESTS WHICH ARE LOCATED WITHIN THE MUNICIPAL
 CORPORATION. POSSESSORY INTERESTS IN EXISTENCE ON THE EFFECTIVE DATE  OF
 THE  LOCAL  LAW,  ORDINANCE OR RESOLUTION SHALL BE PARTIALLY EXEMPT FROM
 TAXATION FOR THE NEXT SUCCEEDING FOUR  YEARS  IN  ACCORDANCE  WITH  THIS
 SECTION;  PROVIDED,  HOWEVER, THAT (A) IF THE LEASE, CONTRACT, OPTION OR
 OTHER AGREEMENT IS RENEGOTIATED OR RENEWED  AND  SUCH  RENEGOTIATION  OR
 RENEWAL BECOMES EFFECTIVE DURING THOSE FOUR YEARS, THE PARTIAL EXEMPTION
 SHALL  NOT  BE  AVAILABLE  SUBSEQUENT  TO  THE EFFECTIVE DATE OF THE NEW
 AGREEMENT, AND (B) IF THE LEASE, CONTRACT,  OPTION  OR  OTHER  AGREEMENT
 CONTAINS  ANY  PROVISION  ASSIGNING LIABILITY BETWEEN THE PARTIES IN THE
 EVENT THAT REAL PROPERTY TAXES ARE IMPOSED, THE PARTIAL EXEMPTION  SHALL
 NOT  BE  AVAILABLE TO POSSESSORY INTERESTS CREATED THEREUNDER. EXCEPT IN
 THE INSTANCES SET FORTH IN  THIS  SUBDIVISION,  FOR  THE  FIRST  TAXABLE
 STATUS DATE OCCURRING SUBSEQUENT TO THE EFFECTIVE DATE OF THE LOCAL LAW,
 ORDINANCE  OR  RESOLUTION,  TAXABLE POSSESSORY INTERESTS SHALL BE EXEMPT
 FROM TAXATION BY ANY MUNICIPAL  CORPORATION  IN  WHICH  LOCATED  TO  THE
 S. 664                              3
 
 EXTENT  OF  EIGHTY PERCENT OF THE ASSESSED VALUE; FOR THE SECOND TAXABLE
 STATUS DATE, TO THE EXTENT OF  SIXTY  PERCENT;  FOR  THE  THIRD  TAXABLE
 STATUS  DATE, TO THE EXTENT OF FORTY PERCENT; AND FOR THE FOURTH TAXABLE
 STATUS  DATE, TO THE EXTENT OF TWENTY PERCENT. NOTWITHSTANDING ANY OTHER
 PROVISION OF LAW IN THIS CHAPTER, POSSESSORY INTERESTS ON PARCELS  WHICH
 HAVE  BEEN DESIGNATED AS MILITARY LAND SHALL BE FULLY EXEMPT FROM SCHOOL
 PROPERTY TAX IF THE SCHOOL DISTRICT WHEREUPON SUCH MILITARY LAND PARCELS
 ARE SITUATED RECEIVES IMPACT  AID  FUNDS  FROM  THE  FEDERAL  GOVERNMENT
 PURSUANT TO 30 CFR PART 222.
   5.  THIS  SECTION SHALL NOT APPLY TO BUSINESSES WITH LESS THAN TWENTY-
 FIVE EMPLOYEES.
   § 5. This act shall take effect on the first of January next  succeed-
 ing the date on which it shall have become a law.