Council of New York Cooperatives & Condominiums
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Tax Issues

Published: Winter 2000

Action Committee for Reasonable Real Estate Taxes:
History & Update

CNYC formed the Action Committee for Reasonable Real Estate Taxes in February of 1990 as an all-volunteer association devoted to achieving a fair and affordable property tax system for New York City. Supported by the Federation of New York Housing Cooperatives, the Coordinating Council of Cooperatives and the Apartment Owners Association, the Action Committee includes concerned individuals and representatives of a broad spectrum of New York City property tax payers.

For a decade, The Action Committee has worked tirelessly for a fair and affordable property tax structure for all New York city taxpayers. Its efforts were first focused upon raising awareness of the fact that homeowners in cooperatives and condominiums pay far more than their fair share of property taxes. A blue ribbon commission on property taxes convened in 1993 confirmed this fact.

In 1996, the City established a three-year program of growing tax abatements for homeowners in cooperatives and condominiums. In August 1999, the abatement program was extended for two more years, through June of 2001 at the rate of 25% for cooperatives and condominiums where the assessment averages $15,000 or less and 17.5% for those with higher assessments.

The law establishing the abatements also mandates that the city prepare a long term plan to continue the process toward tax fairness. A complex undertaking, this plan must consider the revenue needs of the city and must deal fairly with all classes of taxpayers. The Department of Finance has analyzed in depth the data that it collected from the abatement program; it has run the numbers for a variety of scenarios in search of a viable plan. Once presented and approved by the city, the plan will have to be enacted into law by the State Legislature.

During his years in the City Council, Andrew Eristoff was a strong supporter of property tax reform. In 1999 he was named Commissioner of Finance of the City of New York. Commissioner Eristoff addressed the 10th anniversary meeting of the Action Committee for Reasonable Real Estate Taxes on Thursday evening, February 10, 2000. He was accompanied by Deputy Commissioner Israel Shupper, and Fran Pearl and Jacob Glickner, the experts who have worked to find an equitable and implement-able plan for tax fairness. Commissioner Eristoff introduced his colleagues and, with their help, presented for the Action Committee an informative preview of the report on tax equity which the Department of Finance has prepared.

These experts have determined that, although the abatement program has reduced the inequity between taxes paid by homeowners in Class 2 and those in cooperatives and condominiums, it does not address inequities among cooperatives and condominiums. Using the data which has become available through the implementation of the abatement program, the Department of Finance proposes to redistribute the tax burden more equitably among cooperatives and condominiums.

The inequities between Class 1 and Class 2 have several causes--differing assessment methodologies, limitations on certain increases, and historical precedents have all contributed to this disparity, as has the annual practice of adjusting downward the limits on class share increases, which would otherwise have helped to reduce the inequity. There is currently a wide range of assessment ratios within the cooperative and condominium community.

The Department of Finance discerned that a substantial universe is assessed at much less than they should be and that these tend to be apartments of high value. At the same time, there is also a substantial universe--usually of apartments of low value--which are assessed at higher levels than they should be. The Department of Finance explored four different options for correcting the inequities. Commissioner Eristoff offered a description and a critique of each one.

These options form the draft report which the Department has transmitted to the Mayor. It is anticipated that the Mayor will comment upon the options and then approve the issuance of a final report, which should form the basis for the long term plan for property tax reform. When the City Council and the Mayor agree upon this plan, they will join to send a Home Rule Message to the State Legislature, requesting its enactment into law. With the firm support of the city behind it, passage of the plan should be easily achieved. The Action Committee for Reasonable Real Estate Taxes shall continue to monitor the progress of the Department of Finance report and of the long term plan. It is important that progress be made quickly on this issue, so that a long term plan is surely in place before the Giuliani administration goes out of office.

It is likely that a strong grass roots effort may become necessary in the next few months to push for the promulgation of the plan. In such an event the Action Committee will reach out to its member and to the members of supporting organizations for letters, telephone calls and lobbying visits. If you are not currently on the Action Committee mailing list and would like to be included in this important outreach, please contact the Action Committee by phone at 212 496-1306 or fax at 212 580-7801 or mail to 250 West 57th Street, New York, NY 10019-2142.


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250 West 57th Street, Suite 730
New York, NY 10107-0730
Tel: (212) 496-7400
Fax: (212) 580-7801
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