Local Taxation

The Mandate: Towns encompass all territory within New York State except for cities and Indian reservations.  As a result, every individual (except for those living in a city or on an Indian reservation) lives in a town. A village is a municipal corporation within a town, and its residents are residents and taxpayers of both the town and the village is which the town is located.  Of the 932 towns in New York State, 421 of them contain at least one village.  

Read more: Local Taxation for Services Not Provided to Sub-Units of Local Government

The Mandate: Pursuant to the Real Property Tax Law § 406, municipally-owned property that is used for municipal purposes but is located outside municipal boundaries, is generally subject to property taxation by any taxing entity in which the property is located. While there are a few exceptions to this provision based upon how the property is used, these exceptions require the approval of the municipality in which the property is located.

Read more: Taxation of Municipal Property Used for Public Purposes

The Mandate: Pursuant to Real Property Tax Law § 404, property owned by the State of New York, or any of its departments or agencies, is generally wholly exempt from taxation. Current law includes an inconsistent and inequitable patchwork of provisions that, for certain state property, requires a PILOT payment. Due to the ad hoc nature in which policies and programs concerning state-owned land have been developed, similar properties may generate significantly different payments, or in some cases, no payments at all.   In addition, community residences for the developmentally disabled are a responsibility of the whole State.  However, these facilities are not always evenly distributed among municipalities, and as a result, certain municipalities bear a disproportionate burden of these tax-exempt properties.

Read more: Absence of PILOTs on State-Owned Land and Community Residences

The Mandate: All real property in New York is subject to taxation unless the law grants it exempt status. Real property tax exemptions are permitted on the basis of many different criteria, including the use to which the property is put, the owner’s ability to pay taxes, the desire of the State and local governments to encourage certain economic or social activities, and other such rationale. Many tax-exempt properties require the same, and in some cases, more municipal services than non-exempt properties require, yet they are not obligated to pay for such services due to their tax-exempt status. While municipalities currently have the ability to impose user fees and benefit assessments to cover some of these expenses, they are prohibited from doing so for the most costly services, including police and fire protection (see Opinions of the Office of the State Comptroller 81-366 & 90-39).

Read more: Inability to Recoup Costs for Municipal Services Provided to Tax-Exempt Properties

  • 1
  • 2