The New York State Assembly’s Real Property Taxation Committee Proposes the Five Borough Fair Property Tax Act

An earlier Tax Tracker discussed the NYS Court of Appeals decision that revived a lawsuit brought by the Tax Equity Now (TENNY) coalition, which claims that New York City’s property tax system violates the federal Fair Housing Act because it disproportionately burdens low-income communities, among other things. Tax Equity Now New York (TENNY) v. City of New York – Farrell Fritz

Since then, the first legislative attempt at addressing the issues raised by TENNY has been proposed in the New York State Assembly and has been referred to the Assembly’s Real Property Taxation Committee. The proposed Five Borough Fair Property Tax Act (A10600) is purportedly designed to implement comprehensive property tax reforms in New York City, attempting to make the system more equitable and transparent to taxpayers.

The Bill is divided into six parts (A through F), each addressing different aspects of property tax reform seeking to eliminate alleged disparities, including the abolition of the class share system, establishment of homestead exemptions, introduction of a circuit breaker tax abatement, and revisions to the assessment of residential properties. Assembly Bill A10600 can be found here: https://nyassembly.gov/leg/?default_fld=&leg_video=&bn=A10600&term=2023&Summary=Y&Actions=Y&Memo=Y&Text=Y

Key Takeaways from the Bill include:

• Introduction of a Class One-A for specific residential properties in large cities.
• New homestead exemptions based on income for primary residences in New York City.
• A circuit breaker abatement for homeowners with property taxes exceeding 10% of their income.
• Enhanced reporting and mandatory annual information returns for cooperative housing corporations.
• New responsibility for determination market values assessed to the Commission of Finance.

Much of the Bill’s components are based upon the recommendations contained in the NYC Property Tax Reform Commission’s Report, which was previously the subject of another tax tracker: NYC Comptroller Effort to Reform New York City’s Property Tax System – Farrell Fritz