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SECTION 33
Tax exemptions
Private Housing Finance (PVH) CHAPTER 44-B, ARTICLE 2
§ 33. Tax exemptions. 1. (a) Upon the consent of the local legislative
body of any municipality in which a project is or is to be located, the
real property in a project shall be exempt from local and municipal
taxes, other than assessments for local improvements, to the extent of
all or part of the value of the property included in such project which
represents an increase over the assessed valuation of the real property,
both land and improvements, acquired for the project at the time of its
acquisition by the limited-profit housing company, provided, however,
that the real property in a project acquired for purposes of
rehabilitation shall be exempt to the extent of all or part of the value
of the property included in such project, and further provided that the
amount of such taxes to be paid shall not be less than ten per centum of
the annual shelter rent or carrying charges of such project except that
for projects located or to be located in a city of a population of one
million or more, upon the consent of the local legislative body of the
municipality, the amount of such taxes to be paid may be set at not less
than (i) the taxes payable with respect to the real property in such
project with respect to the year nineteen hundred seventy-three, or,
(ii) if such project was not occupied in such year, not less than ten
per centum of the annual shelter rent or carrying charges first
established pursuant to subdivision one of section thirty-one of this
article. Shelter rent shall mean the total rents received from the
occupants of a project less the cost of providing to the occupants
electricity, gas, heat and other utilities. Total rents shall include
rent supplements and subsidies received from the federal government, the
state or a municipality on behalf of such occupants, but shall not
include interest reduction payments pursuant to subdivision (a) of
section two hundred one of the Federal Housing and Urban Development Act
of nineteen hundred sixty-eight. The tax exemption shall operate and
continue so long as the mortgage loans of the company, including any
additional mortgage loan the proceeds of which are used primarily for
the residential portion of the project, which additional loan is
approved by the commissioner or the supervising agency, are outstanding.

(b) Where a municipality acts on behalf of another taxing jurisdiction
in assessing real property for the purpose of taxation, or in levying
taxes therefor, the consent of the local legislative body of such
municipality shall have the effect of exempting the real property in a
project from local and municipal taxes, other than assessments for local
improvements, levied by or in behalf of both such taxing jurisdictions.

As used in this paragraph, the term "taxing jurisdiction" means any
municipal corporation or district corporation, including any school
district or any special district, having the power to levy or collect
taxes and benefit assessments upon real property, or in whose behalf
such taxes or benefit assessments may be levied or collected.

(c) Notwithstanding the provisions of paragraphs (a) and (b) of this
subdivision, the real property of a state urban development corporation
project acquired, owned, constructed, managed or operated by a company
incorporated pursuant to the not-for-profit corporation law and this
article shall be entitled to all the benefits provided by section four
hundred twenty-two of the real property tax law. The real property of a
state urban development corporation project, other than a state urban
development corporation project acquired, owned, constructed, managed or
operated by a company incorporated pursuant to the not-for-profit
corporation law and this article, shall be exempt from all local and
municipal taxes, other than assessments for local improvements, to the
extent of the value of the property included in such project as
represents an increase over the assessed valuation of the real property,
both land and improvements, acquired for the project on the date of its
acquisition by the limited-profit housing company, provided that the
amount of such taxes to be paid shall not be less than ten per centum of
the annual shelter rent or carrying charges of such project, as defined
in paragraph (a) hereof. The tax exemption shall operate and continue so
long as the mortgage loans of such limited profit housing company,
including any additional mortgage loan the proceeds of which are used
primarily for the residential portion of the project, which additional
loan is approved by the commissioner or the supervising agency, are
outstanding and the project is continued to be operated as a
limited-profit housing project. If a state urban development corporation
project qualifying for tax exemption pursuant to this paragraph is sold,
with the approval of the commissioner, to another limited-profit housing
company, such successor company shall be entitled to all the benefits of
this paragraph. In the event that such sale is to a company incorporated
pursuant to the not-for-profit corporation law and this article, such
successor company shall be entitled to all the benefits provided by
section four hundred twenty-two of the real property tax law.

(d) Notwithstanding the provisions of paragraphs (a) and (b) of this
subdivision, when a project is financed with a mortgage loan pursuant to
this article or article three of this chapter and (i) there is a
participation, new loan or investment pursuant to section twenty-three-b
of this article or (ii) such mortgage loan is assigned, modified or
satisfied pursuant to section twenty-three-a or forty-four-b or
subdivision twenty-two-a of section six hundred fifty-four of this
chapter, the real property of the project shall be exempt from all local
and municipal taxes, other than assessments for local improvements, to
the extent of the value of the real property included in such project
which represents an increase over the assessed valuation of the real
property, both land and improvements, acquired for the project on the
date of its original acquisition for the project by the original
mortgagor under a mortgage loan pursuant to this article or article
three of this chapter, provided that the amount of taxes to be paid on
the project shall not be less than ten per centum of the annual shelter
rent or carrying charges of such project, as defined in paragraph (a) of
this subdivision. Such tax exemption shall commence in each instance
from the date when the project becomes subject to a mortgage insured by
the federal government and shall operate and continue so long as a
mortgage on such project is insured or held by the federal government or
so long as the project is thereafter owned by the federal government or
so long as any residual indebtedness is outstanding, whichever is
longer. When there is a participation, new loan or investment pursuant
to section twenty-three-b of this article, such participation, new loan
or investment shall be deemed to be the equivalent of a federally
insured mortgage for purposes of this paragraph. Nothing contained in
this paragraph shall be construed to limit or otherwise impair the
benefits available to any company eligible for exemption from taxation
pursuant to section thirty-one or section thirty-six-a of this article,
section four hundred twenty-two or section four hundred sixty-seven-c of
the real property tax law, or section fifty-eight of the public housing
law. The foregoing shall not be deemed to authorize any company to
receive the benefits of any exemption from taxation in contravention of
the provisions of section two of article eighteen of the constitution.

(e) Notwithstanding the provisions of paragraph (a) of this
subdivision, a municipality, with the approval of the local legislative
body, may contract to exclude all or part of any rent subsidies received
from the federal government pursuant to section eight of the United
States Housing Act of nineteen hundred thirty-seven as amended in the
computation of total rents received.

(f) Notwithstanding the provisions of paragraph (a) of this
subdivision, if the number of units occupied by persons receiving the
benefit of rental assistance payments from the federal government
pursuant to section eight of the United States Housing Act of nineteen
hundred thirty-seven, as amended, with respect to any project increases
by more than one hundred percent within any twelve consecutive months
prior to nineteen hundred eighty-five over the number of units for which
such subsidies were available during the preceding twelve consecutive
months or as July first, nineteen hundred eighty, whichever is later,
taxes payable for such additional subsidized units and subsequent units
subsidized in the same manner shall be based solely upon that portion of
total rents received on account of such additional subsidized units that
is not funded by such rental assistance payments, provided, however,
that no project shall receive such additional tax exemption (i) unless a
minimum of seventeen percent of the units in the project receive the
benefit of such subsidies, or (ii) if any mortgage on such project is
insured or held by the federal government or if the project is owned by
the federal government. The amount of exemption to which a project is
entitled pursuant to this paragraph shall be certified annually by the
commissioner or the supervising agency, as the case may be.

2. Notwithstanding the provisions of subdivision one hereof, whenever
a dwelling in a project is leased to the New York state housing finance
agency pursuant to the provisions of section forty-four-a of this
chapter, so much of the assessed value of such project attributable to
such dwelling (including a pro rata portion of the value of the land and
common spaces) as represents an increase over the proportionate assessed
value of the real property, both land and improvements, acquired for
such project at the time of original acquisition therefor, shall be
exempt during the period of such lease from taxation for county, city,
town, village and school district purposes and special ad valorem
levies; provided that if in any year the aggregate amount of such taxes
and levies that would have been attributable to such dwelling but for
the exemption provided by this subdivision exceeds the amount payable
out of the low rent lease account pursuant to subdivision three of
section forty-four-a of this chapter with respect to the agency's rent
obligation for such dwelling, the agency shall make proportional
payments in lieu of such taxes and levies to the appropriate county,
city, town, village, school district or special district, or any
combination thereof as the case may be, in an aggregate amount equal to
one half of the sum of (a) the amount of such excess and (b) the amount,
if any, by which the rent paid to the agency under the sublease for such
dwelling exceeds the agency's rent obligation for such dwelling. Nothing
contained in this subdivision shall preclude the increase of the taxable
assessed value attributable to such dwellings as a result of a net
increase in the assessed valuation of the taxable property in the
assessing unit as a result of assessing such property at a higher ratio
of full value.

3. Notwithstanding the provisions of subdivision one hereof, whenever
a dwelling in a project is leased to an authority, pursuant to the
provisions of sections seventeen and thirty-one of this chapter, so much
of the assessed value of such project attributable to such dwelling
(including a pro rata portion of the value of the land and common
spaces) as represents an increase over the proportionate assessed value
of the real property, both land and improvements, acquired for such
project at the time of original acquisition therefor, shall be exempt
during the period of such lease from taxation for county, city, town,
village and school district purposes and special ad valorem levies.
Nothing contained in this subdivision shall preclude the increase of the
taxable assessed value attributable to such dwelling as a result of a
net increase in the assessed valuation of the taxable property in the
assessing unit as a result of assessing such property at a higher ratio
of full value.

4. Notwithstanding the provisions of subdivision one hereof, when a
mutual company is organized under this article to facilitate the
acquisition of a building by residents thereof, the amount of local and
municipal taxes, other than assessments for local improvements, to be
paid on the real property included in such project, both land and
improvements, shall not exceed twenty per centum of the annual shelter
rent or carrying charges of such project, as defined in paragraph (a) of
subdivision one hereof; provided, however, that where such acquisition
of a building by residents thereof involves the financing of
rehabilitation or other improvement as well as acquisition, upon the
consent of the local legislative body of the municipality in which the
project is located the amount of such taxes may be further reduced
provided that such amount shall not be less than ten per centum of the
annual shelter rent or carrying charges of the project, as defined in
paragraph (a) of subdivision one hereof; or the company may in lieu of
requesting such consent apply for the benefits of the local law, if any,
enacted pursuant to section four hundred eighty-nine of the real
property tax law. Such tax exemption, if any, granted pursuant to this
article shall operate and continue so long as a loan made under this
article or any subsequent loan approved by the commissioner or the
supervising agency to enhance the residential portion of the project and
the project is continued to be operated for the purposes set forth in
this article is outstanding.

5. Bonds, mortgages, notes, income debentures and obligations of a
company are declared to be issued for a public purpose and to be public
instrumentalities and together with interest thereon shall be exempt
from tax including but not limited to the mortgage recording taxes
imposed by article eleven of the tax law.

6. Any project that received a tax exemption under paragraphs (a), (c)
and (d) of subdivision one, and subdivision four of this section may,
upon the expiration of the tax exemption period, be granted an
additional tax exemption period of up to fifty years, or until such time
as the project is no longer operated under the restrictions and for the
purposes set forth in this article, whichever is sooner.