Editorials
Condominium Law 339-y scam continues
By Lee Chowaniec
Oct 24, 2009, 23:48

In the summer of 2008, it appeared that after several years of pressure put on Albany by municipalities, their town assessors and the public to reform NYS Real Property Law 581 and 339-y, a bill drafted by Senator William Stachowski would allow municipalities the right to opt out of 339-y consideration, and with builders and realtors seeking compromise, reform would be had. No such thing happened and Lancaster taxpayers are the worse for it.

Condominium Law 339-y’s original intent was to give tax relief to apartment complex owners who lived in buildings four or more stories in height. The Law has been perverted to allow 40% tax reductions to single-family, stand alone patio homes and two-story townhouses. A patio home owner with a $250,000 market value home gets an assessment reduction of $100,000 and pays the same taxes as a homeowner with a property market value of $150,000.

Lancaster is in a reassessment process where we are being told fairness will rule; where the playing field will be leveled. That being the case, assessments should be based on 100% property market value. If municipalities believe patio home owners deserve tax credits because of the private services they pay for that are not provided by the Town, the tax credit should be based on actual private service costs incurred; such service costs are certainly nowhere near the 40% property value tax break now me allowed.

The average patio home in Lancaster sells for approximately $250,000. A 40% reduction in assessment means the property owner is now paying on an assessed value of $150,000, a $100,000 reduction. As Lancaster residenst pay somewhere around $30 per thousand of assessed value for school and property taxes, that homeowner is getting a $3,000 tax break - $250 per month. That amount far exceeds the costs of the private services provided; oft times surpassing the entire Association fee. What is even more unfair is that like developments with like associations built before 1996 were locked out of any tax reduction consideration by the town passing a “no conversion” ordinance.

As with IDA’S, taxpayers see no benefits, yet pay for others who do; all on the taxpayer dime. The town is looking for ways to raise revenues to decrease the 2010 budget tax rate increase. Hello!

Town response

Supervisor Robert Giza declared that 339-y law is a state law that was put into effect by downstate politicians who control the State. To get any power to make change Giza said they would have to get all legislators from Albany to Buffalo to work together to change the law.

Town Assessor Dave Marrano declares there had been a number of laws that had been proposed to reform 339-y that never made it to the Assembly or Senate floor. He added that the feeling among the local governments is that as the law is the law, they would take a very hard look as to how assessors could use the law.

Says Marrano: “The 339-y law requires us to value those properties on an income approach, based on rent (what the unit would rent for),” Marrano explained. “We have been able to secure updated rental and cost information and part of our reval plan and other towns as well, is to say “the law is the law, we’re not going to change it, but we are going to do the right (property) valuation. And, we have more property in Lancaster not getting 339-y consideration than homeowner associations than do receive it. The approach we are going to take on those that don’t get 339-y consideration, as part of our reval process, is to create what is called a “functional, marketability obsolescence” on those properties. I have to value those non 339-y properties on market sales approach, not on income approach. But I can look at what impact 339-y is having on the ability to market these properties. The Amherst folks are doing the same thing.”

Marrano declared that 339-y properties that now pay only 60 percent in taxes on market value may pay up to 80 percent, while conversely those associations that don’t have 339-y will see a reduction. He added that he has had similar discussions with other non 339-y associations, as well as with Chowaniec, and all agree it is a plan that incorporates more fairness.

Comments

For town residents who have lost jobs in this time of economic crisis, have had salary increases frozen (sometimes for years), are making sacrifices to pay their bills and mortgages, or even have homes of equal value but pay much more in property taxes, giving homeowners of dwellings valued between $225,000 and $400,000 in Lancaster a 40% tax break has to be most disturbing and considered ludicrous by the great majority of Lancaster residents.

A level playing field, I think not! As the three Town Council Members are telling the town department heads, “Mr. Assessor, sharpen your pencil and get back to us with a fair 100% market value assessment plan that truly levels the playing field for all Lancaster taxpayers. Taxpayers should not be subsidizing owners of homes with market values much greater that theirs.




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