Editorials
Resident again petitions Town memorialize Albany to reform Condo Law 339-y
By Lee Chowaniec
Apr 16, 2008, 14:39

The writer petitioned the Lancaster Town Board to once again memorialize Albany to reform Condominium Law 339-y and return its language to its original intent, namely, to grant property tax reductions only to buildings, four or more stories in height.

The town had memorialized Albany several years on the same matter, a time when developers were not applying for such consideration on patio home construction in Lancaster. Things have since changed.

The writer visited a patio home model built by Marrano/Marc Equity in the Pleasant Meadows subdivision. A prospective homeowner asked a sales representative what the taxes would be on the $260,000 model being viewed.

He was told they would be somewhere around $4,200. The sales person explained they should be around $6,000, but because of having 339-y condo consideration, the tax reduction would lower it to that amount.

I later asked the same sales representative how he came up with the $6,000 number because the overall tax rate for homes in the town of Lancaster is $30 per thousand dollars of assessed valuation. That would make the property taxes $7,800. He just walked away without saying a word.

Fairness

Getting a 40 percent reduction in taxes because of 339-y, the purchaser of the $260,000 patio home would get a $3,120 reduction in taxes and pay only $4,680 in taxes. How unfair is that to another Pleasant Meadows homeowner having the exact same house in the same development, but across the street in the single-family R-1 district paying full taxes of $7,800.

But it’s not unfair you say because the patio home association is a private entity and pays for its own snow removal, street / sewer / lighting services and maintenance, etc. “They deserve a tax break,” so you say.

Well, it is unfair to the numerous homeowners who live in like associations, paying for like services and maintenance and receive no tax breaks.

It is unfair competition regarding other builders and homeowners trying to sell like homes and not having applied for 339-y consideration and receiving such tax reduction.

Pleasant Meadows patio homeowners will receive a $3,120 tax break. That amounts to $260 per month, an amount that will far exceed his or her association fee. That means other taxpayers will be paying for their landscaping, maintenance reserves (roof, painting, driveway, etc.) and more.

Cost to taxpayers

Town Assessor Dave Marrano recently appeared before the Town Board speaking on the inequity of 339-y and it’s adverse impact on his promoting and delivering a fair and credible assessment program.

He informed the board that based on assessment estimates the tax revenue lost with the Pleasant Meadows 110 patio home development would be $11 million.

Marrano/Marc Equity has put in a prospectus to the Attorney General’s office for 339-y consideration for the proposed 100-unit townhouse development he proposes building in Pleasant Meadows. That would result in another $6 million- revenue loss that other taxpayers would have to make up.

When asking town assessors how developers get 339-y approval for patio home development when land is involved, albeit only the footprint of the building, they are unable to answer.

Supervisor Robert Giza replied that the town had memorialized Albany several years on reforming Condominium Law 339-y. “What needs to be done is for every one from Buffalo to Albany has to get together to fight off the voting power in New York City.”

“If it benefits them (New York City), the people that elects them (politicians), they will not budge. And, your not going to get everyone to agree.”

“True, said Chowaniec. “But unless the municipalities do the same as the State Association of Assessors did by pressuring Albany on the matter, this getting together will never happen. For that reason, the Town of Lancaster should memorialize Albany once again to stop the Condo Law perversion.”

Senator Elisabeth O’C. Little’s bill (A-1058) and Assemblyman Sandy Galef’s bill (1574) languish in committee with little chance of making the floor for vote.

Hopefully, the Town of Lancaster will once again memorialize Albany on the perversion of Condominium Law 339-y, and that other municipalities will follow suit.

A work in progress draft

State Senator, 58th District, William Stachowski is working on a draft of a bill that would provide municipalities an opportunity to opt out of certain provisions relating to newly constructed condominiums.

As it now reads:

Summary of Provisions:

Section 1 amends subdivision 1 of section 339-y of the real property law by adding a new paragraph (g) to extend a local opt out for newly constructed condominiums in municipalities outside of New York City.

Existing Law:

Under current law, condominiums are assessed at lower rates than freestanding homes/structures and municipalities are unable to properly assess properties that apply for lower rates.

Justification:

Under New York State’s real property tax law, assessors must maintain an equitable assessment roll. Current laws undermine the concept of equitable assessments by dictating the use of the income approach when assessing condominiums, precluding the use of other appropriate appraisal methods.

The modern condominium was created to allow the sale and financing of dwelling units in multiple story structures. The condominium addressed issues of ownership rights, governance, operation, maintenance and common areas unique to this type of development.

Contrary to the past construction and development of condominiums, today’s developments of single-family homes are being called condominiums with the sole purpose of getting a tax break.

These developments are indistinguishable from a traditional single-family subdivision. Unlike the traditional subdivision, full ownership rights extend beyond the unit’s exterior to the entire single-family home and lot.

Common area is minimal and in some cases limited to the street. The necessity for condominium ownership due to building style is lost. In its current form, the law legislates inequity, and ignores the concept of home rule.

This fair and simple solution, to extend the local opt out provisions in real property law for condominium conversions in municipalities outside of New York City to any new build condominium will allow a municipality to choose what type of assessment should correctly apply to a newly built structure.

There would be no fiscal implications to New York State, but would be favorable to local municipal governments.

Other towns, another method

Other Western New municipalities have stipulated that rezone approval to build MFR-3 and MFR-4 homes will be predicated on the builder not applying for 339-y consideration.

Would that the rezones that were approved for Lancaster’s Pleasant Meadows patio and townhouse development had such stipulation.


















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