New Law Allows Property Tax Refunds On Properties Destroyed Or Damaged By Last Summer's Mohawk Valley Flooding

Hugh T. Farley

April 10, 2007

The Governor has signed a new law -- the Flood Assessment Relief Act of 2007 -- allowing Mohawk Valley and Southern Tier municipalities and school districts to refund property taxes paid on homes and businesses destroyed or severely damaged by last June's catastrophic flooding.


"It just doesn't make sense that someone whose house was totally destroyed in the flood still has to pay property taxes on the value of the property before it was destroyed," Senator Farley said. "This new law will permit local governments to recalculate taxes on impacted properties, and to refund excess taxes already paid."

Under terms of the new law, counties may decide to "opt in" by passing a resolution before May 1, 2007, after obtaining concurrence from localities with at least ten affected properties. If a county decides to participate, taxpayers whose properties lost at least fifty percent of their value as a result of the flooding may, until May 22, 2007, apply to their local assessors for a special recalculation. If approved, the reduced value would be applied retroactively to August 1, 2006, and excess school and town/county taxes paid since then would be refunded.

The recently-passed State Budget includes $5 million in special State aid for local governments which participate in the program. This additional State aid will help the municipalities offset losses to their local tax base. School districts will be "held harmless," continuing to receive State aid regardless of the reduction in property values.

"I am hopeful that our local Mohawk Valley counties will decide to participate," Senator Farley said. "Although the tax recalculations will be an administrative hassle, failing to participate would really be unfair to the affected taxpayers."

The text of the new law and its explanatory memorandum follow:


AN ACT to establish the "Flood Assessment Relief Act of 2007"

Became a law March 31, 2007, with the approval of the Governor. Passed by a majority vote, three-fifths being present.

The People of the State of New York, represented in Senate and Assembly, do enact as follows:

Section 1. Short title. This act shall be known and may be cited as the "flood assessment relief act of 2007".

§ 2. Definitions. For the purposes of this act, the following terms shall have the following meanings:

1. "County" shall mean the counties of Fulton, Greene, Hamilton, Madison, Rensselaer, Schenectady, Tompkins, Broome, Chenango, Cortland, Delaware, Herkimer, Montgomery, Oneida, Orange, Otsego, Schoharie, Sullivan, Tioga and Ulster.

2. "Taxable status date" shall mean the date established pursuant to section 302 of the real property tax law.

3. "Catastrophically impacted" shall mean a property there is cause to believe the value of which was diminished by 50 percent or more as a result of the weather.

4. "Taxpayer" shall mean the owner of real property which was catastrophically impacted in a county.

5. "Assessor" shall mean a town, city, or village assessor or board of assessors in a county.

6. "Property owner" shall mean the owner of real property who is responsible for payment of real property taxes on such property.

7. "Weather" shall mean the storms, rains, or floods which occurred in a county during the period beginning June 15, 2006 and ending July 15, 2006.

8. "Correction" shall mean the process for the correction of a "clerical error" as defined in section 550 of the real property tax law and as provided for in title 3 of article 5 of the real property tax law.

§ 3. Local option. A county may exercise the provisions of this act if such county's governing body shall, by May 1, 2007, pass a resolution resolving to implement the provisions of this act. Prior to the passage of such resolution, the chief executive officer of a county (or the representative thereof) shall consult with those municipal corporations as defined in subdivision 10 of section 102 of the real property tax law which such chief executive officer has reason to believe had at least 10 properties whose value was diminished as a result of the weather and shall secure the written consent of such corporation to be included in scope and coverage of such resolution.

§ 4. Assessment relief for flood victims. Notwithstanding any other provision of law to the contrary, a taxpayer whose real property is in a county and whose property has been catastrophically impacted as a result of weather occurring in the state of New York may seek administrative review or correction of the valuation assigned to such real property or the improvements thereon pursuant to the provisions of article 5 of the real property tax law. An assessor shall also seek administrative review or correction of valuations on any property he or she believes was catastrophically impacted as a result of such weather. In the event such review or correction is sought, the board of assessment review or other authorized body or officer, in making such determinations as it is otherwise authorized to make pursuant to the provisions of the real property tax law, shall consider the taxable status date as provided for in section 302 of the real property tax law, to be August 1, 2006 instead of the taxable status date otherwise provided for in such section or any other provision of law. Any complaint by a taxpayer who is also the property owner and who is seeking a lower valuation, shall not be required to suggest such valuation to the board of assessment review, but such suggestion may be made by an assessor or board of assessors, even if such assessor or board of assessors is not the party who has made the application for assessment review. In the event the assessor seeks an administrative determination before a board of assessment review of any property he or she is not an owner of or otherwise entitled by law to seek an administrative determination from such board, such assessor shall also seek an administrative determination and a lower valuation of all such properties he or she believes were catastrophically impacted by weather within such jurisdiction. Such determination may be sought in a class application by the assessor to the board of assessment review filed pursuant to either section 524 or 553 of the real property tax law. The failure of such assessor to seek such a determination for all such catastrophically impacted proper- ties shall not impair the effectiveness of any review sought by such an assessor and a cause of action against such assessor for failing to include any specific property or class of properties shall not exist under the laws of this state. The board of assessment review may accept applications for administrative review of the assessment of any catastrophically impacted property up until and including May 22, 2007; provided that where such an application has not been submitted by that date, the assessor or taxpayer may nonetheless seek correction of the assessment in the manner provided by section 553, 554 or 556 of the real property tax law, whichever is appropriate. The rights contained in this act shall not otherwise diminish any other legally available right of any property owner or party who may otherwise lawfully challenge the valuation or assessment of any real property or improvements thereon. All remaining rights, including, but not limited to, the right to seek correction of the assessment as provided for in sections 554 and 556 of the real property tax law and to judicially challenge such assessment or valuation hereby remain and shall be available to the party to whom such rights would otherwise be available notwithstanding this act.

§ 5. School districts held harmless. Each school district located in a county, as defined in subdivision one of section two of this act, shall be held harmless by the state for any reduction in state aid that would have been paid as tax savings pursuant to section 1306-a of the real property tax law incurred due to the provisions of this act.

§ 6. This act shall take effect immediately and shall be deemed to have been in full force and effect on and after June 1, 2006.




TITLE OF BILL: An act to establish the "Flood Assessment Relief Act of 2007"

PURPOSE OR GENERAL IDEA OF BILL: This bill is designed to offer tax assessment relief to those who were victims of this year's flooding.

SUMMARY OF SPECIFIC PROVISIONS: Section one titles the bill the "flood assessment relief act of 2007."

Section two lists definitions.

Section three allows for a local option in order to participate in this program.

Section four allows for municipalities to reassess property that has been damaged by a flood in specific counties.

Section five holds school districts harmless for loss of STAR reimbursement by the state as a result of lowered assessments.

Section six establishes the effective date.

JUSTIFICATION: This legislation allows localities the option to participate in the flood assessment relief act of 2007 and therefore make adjustments to the 2006 real property tax rolls and issue refunds. After the June flooding of 2006, many counties throughout New York State were designated as both Federal and State disaster areas. Thousands of New Yorkers were victims of record flooding and damage. Consequently, many found themselves homeless or with extensive property damage. As a result of the damage, these properties are valued at much less than the tax records would reflect. This legislation would allow property owners to be taxed at the value of their home after the flooding.

PRIOR LEGISLATIVE HISTORY: Similar to S.8513 of 2006: Passed Senate.

FISCAL IMPLICATIONS: To be determined - 2007-08 budget includes $5 million.

EFFECTIVE DATE: This act shall take effect immediately, and be deemed effective as of June 1, 2006.