S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1367
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              January 8, 2021
                                ___________
 
 Introduced  by  M.  of  A.  MAGNARELLI  -- read once and referred to the
   Committee on Real Property Taxation
 
 AN ACT to amend the real property tax law, in relation  to  the  certif-
   ication  of certain property complying with the residential-commercial
   urban exemption program and the revocation of benefits of such program
   in certain circumstances; and to amend a chapter of the laws  of  2020
   amending  the  real property tax law relating to the  residential-com-
   mercial urban exemption program,  as  proposed  in  legislative  bills
   numbers  S.  5254-B  and  A.  8091-A, in relation to the effectiveness
   thereof
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 485-a of the real property tax law, as amended by a
 chapter of the laws of 2020, amending the real property tax law relating
 to  the  residential-commercial  urban exemption program, as proposed in
 legislative bills numbers S. 5254-B and A. 8091-A, is amended to read as
 follows:
   § 485-a. Residential-commercial  urban  exemption  program.  1.  Defi-
 nitions.    As  used in this section, the following terms shall have the
 following meanings:
   (a) "Municipality" means any town, city or village except for  a  city
 having more than one million inhabitants.
   (b)  "Applicant" means any person obligated to pay real property taxes
 on the property for which an exemption from real  property  taxes  under
 this section is sought.
   (c)  "Commercial construction work" means the modernization, rehabili-
 tation, expansion or other improvement of the portion of mixed-use prop-
 erty to be used for commercial purposes.
   (d) "Commercial purpose or use"  means  (I)  the  buying,  selling  or
 otherwise  providing  of  goods  or  services  directly  to the public[,
 including hotel services,  retail  stores,  office  space,  restaurants,
 bars,  gyms,  theaters, and cafes]; OR (II) A NON-RESIDENTIAL LAWFUL USE
 INCLUDING, BUT NOT LIMITED TO, AN OFFICE, HOTEL, RETAIL STORE,  BREWERY,
 DISTILLERY,  RESTAURANT,  CAFE,  BAR  OR  TAVERN, GYMNASIUM, THEATER, OR
              

 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD07191-01-1

 A. 1367                             2
 
 ENTERTAINMENT VENUE WHICH EMPLOYS OR IS ANTICIPATED TO EMPLOY A  MINIMUM
 OF  FIVE  EMPLOYEES  PRIMARILY  AT  THE  MIXED-USE PROPERTY FOR WHICH AN
 EXEMPTION UNDER THIS SECTION IS SOUGHT.
   (e)  "Mixed-use  property"  means  property on which will exist, after
 completion of residential construction work or a combination of residen-
 tial construction work and commercial construction work, a  building  or
 structure  used  for both residential and commercial purposes  of which,
 at least [fifty] FORTY percent of the  building  or  structure's  square
 footage  is  devoted to residential purposes or use and at least fifteen
 percent of the building or structure's  square  footage  is  devoted  to
 commercial  purposes  or  use.  [Only square footage existing in a story
 above grade shall  be  used  in  the  determination  of  the  building's
 percentage  of  residential  purposes  or use and commercial purposes or
 use.]
   (f) "Person"  means  an  individual,  corporation,  limited  liability
 company,  partnership,  association,  agency,  trust, estate, foreign or
 domestic government or subdivision thereof, or other entity.
   (g) "Residential construction work" means the creation, modernization,
 rehabilitation, expansion or other improvement of dwelling units,  other
 than  dwelling units in a hotel, in the portion of mixed-use property to
 be used for residential purposes.
   [(h) "Floor area" means the horizontal areas of the several floors  or
 any  portion  thereof of a mixed-use property measured from the exterior
 faces of exterior walls or from the center line of party  walls,  exclu-
 sive of any area existing below-grade.
   (i)] (H) "Story above grade" means any story having its finished floor
 surface entirely above grade.
   [(j)]  (I)  "Grade" shall mean the finished ground level adjoining the
 building at all exterior walls.
   2. Any municipality may, by local law, provide for  the  exemption  of
 real  property  from  taxation  as  provided  in  this section. Upon the
 adoption of such a local law, the county in which such  municipality  is
 located may, by local law, and any school district, all or part of which
 is located in such municipality, may, by resolution, exempt such proper-
 ty  from  its taxation in the same manner and to the same extent as such
 municipality has done.
   3. Upon the adoption of such a local law, non-residential real proper-
 ty, upon conversion to mixed-use property, shall be exempt from taxation
 and special ad valorem levies as provided for  in  subdivision  four  of
 this section. [Land which was vacant prior to the residential or commer-
 cial construction work for which a tax exemption is sought, shall not be
 eligible to receive benefits pursuant to this section.]
   4. (a) (i) For a period of twelve years from the approval of an appli-
 cation,  the increase in assessed value of such property attributable to
 such conversion shall be exempt as provided in subparagraph (ii) of this
 paragraph.  Such  exemption  shall  be  computed  with  respect  to  the
 "exemption  base".  The exemption base shall be determined for each year
 in which there is an increase in assessed  value  so  attributable  from
 that of the previous year's assessed value.
   (ii)  The  following table shall illustrate the computation of the tax
 exemption:
 
       Year of exemption                      Percentage of exemption
 
           1 through 8                        100% of exemption base
           9                                  80% of exemption base

 A. 1367                             3
 
           10                                 60% of exemption base
           11                                 40% of exemption base
           12                                 20% of exemption base
 
   (b) No such exemption shall be granted unless:
   (i)  such conversion was commenced subsequent to the date on which the
 municipality's local law took effect; AND
   (ii) the cost of such conversion  exceeds  the  sum  of  ten  thousand
 dollars or such greater amount as may be specified by local law[;
   (iii) at least seventy-five percent of the floor area of the mixed-use
 property consists of the pre-existing building or structure;
   (iv)  the  portion  of  the  building  used for commercial purposes is
 currently, as demonstrated by documentation submitted by the  applicant,
 used as such or is in good faith contemplated].
   (c) For purposes of this section the term conversion shall not include
 ordinary maintenance and repairs.
   (d)  No  such exemption shall be granted concurrent with or subsequent
 to any other real property tax exemption granted to  the  same  improve-
 ments to real property, except, where during the period of such previous
 exemption,  payments in lieu of taxes or other payments were made to the
 local government in an amount that would have been equal to  or  greater
 than the amount of real property taxes that would have been paid on such
 improvements  had  such  property  been granted an exemption pursuant to
 this section. In such case, an exemption shall be granted for  a  number
 of  years  equal  to  the twelve year exemption granted pursuant to this
 section less the number of years the property would have been previously
 exempt from real property taxes.
   5. Such exemption shall be granted only upon application by the  owner
 of  such  real  property  on a form prescribed by the commissioner. Such
 application shall be filed with the  assessor  of  the  municipality  or
 county having the power to assess property for taxation on or before the
 appropriate taxable status date of such municipality or county.
   6.  If  the assessor is satisfied that the applicant is entitled to an
 exemption pursuant to this section, he or she shall approve the applica-
 tion and such real property shall be exempt from taxation and special ad
 valorem levies as in this section provided. The assessed  value  of  any
 exemption  granted  pursuant  to  this  section  shall be entered by the
 assessor on the assessment roll with  the  taxable  property,  with  the
 amount of the exemption shown in a separate column.
   7.  (a)  During  the period of exemption pursuant to this section, the
 owner shall submit an annual certification  to  the  assessor  attesting
 that  the  property complies with the provisions or requirements of this
 section and any additional provisions or requirements as may be provided
 by local law. Failure to submit such certification shall result in revo-
 cation of benefits. Such certification shall include at  a  minimum  the
 following:
   (i)  the  types  of  residential  use and the total above-grade square
 footage AND BELOW-GRADE SQUARE FOOTAGE of such use;
   (ii) the types of commercial use  and  the  total  above-grade  square
 footage AND BELOW-GRADE SQUARE FOOTAGE of such use;
   (iii) attestation that the portion of the building used for commercial
 purposes is currently, as demonstrated by documentation submitted by the
 applicant,  used  as such or is in good faith contemplated TO BE USED AS
 SUCH; [and]
   (iv) THE SPECIFIC ADDRESS OF THE ENTRANCE  THROUGH  WHICH  THE  PUBLIC
 ENTERS THE PORTION OF THE BUILDING USED FOR COMMERCIAL PURPOSES;

 A. 1367                             4
 
   (V)  IF THE PORTION OF THE BUILDING INTENDED TO BE USED FOR COMMERCIAL
 PURPOSES IS NOT CURRENTLY IN ACTIVE USE FOR SUCH PURPOSES  AND  OPEN  TO
 THE  PUBLIC,  THE REASONS WHY IT IS NOT CURRENTLY BEING USED FOR COMMER-
 CIAL PURPOSES AND OPEN TO THE PUBLIC; AND
   (VI) all such other information required by the municipality.
   (b)  If  the  assessor is satisfied that the applicant continues to be
 entitled to the exemption pursuant to this section, the  assessor  shall
 approve the certification and the real property shall remain exempt from
 taxation  and  special ad valorem levies for another year as provided in
 this section.
   8. (a) The benefits of this section shall be revoked upon a finding by
 the assessor that:
   (i) the application for benefits hereunder or the annual certification
 required hereunder contains a false statement or false information as to
 a material matter or omits a material matter; [or]
   (ii) the eligible real property fails to comply with one  or  more  of
 the  provisions  or  requirements  of  this section or any provisions or
 requirements provided by local law; OR
   (III) THE PORTION OF THE PROPERTY DEVOTED TO COMMERCIAL  PURPOSES  HAS
 NOT  BEEN  IN  ACTIVE USE FOR COMMERCIAL PURPOSES AND OPEN TO THE PUBLIC
 FOR THREE CONSECUTIVE YEARS.
   (b) Such revocation shall require the repayment of any benefits previ-
 ously granted pursuant to this section FOR ANY  YEAR  DURING  WHICH  THE
 PROPERTY  WAS  NON-COMPLIANT  OR THE APPLICATION OR ANNUAL CERTIFICATION
 CONTAINED A FALSE STATEMENT OR FALSE INFORMATION AS TO A MATERIAL MATTER
 OR OMITTED A MATERIAL MATTER.
   (C) NO BENEFITS MAY BE REVOKED UNLESS THE  APPLICANT  HAS  BEEN  GIVEN
 THIRTY  DAYS'  NOTICE  OF  SUCH REVOCATION AND HAS BEEN GIVEN REASONABLE
 NOTICE TO CURE ANY FAILURE TO COMPLY WITH THE PROVISIONS OF REQUIREMENTS
 OF THIS SECTION.
   9. If the assessor determines that there was a  material  misstatement
 in  an  application filed by or on behalf of the owners for an exemption
 pursuant to this section and that such misstatement provided  the  basis
 for  the  granting  of such exemption, the municipality shall proceed to
 impose a penalty on the applicant of one thousand dollars in addition to
 recovering the amount of any prior exemption granted.
   § 2.  Section 2 of a chapter of the laws of 2020,  amending  the  real
 property  tax law relating to the residential-commercial urban exemption
 program as proposed in  legislative  bills  numbers  S.  5254-B  and  A.
 8091-A, is amended to read as follows:
   §  2.  This  act  shall take effect January 1, 2021 and shall apply to
 properties for which the initial application for exemption are  received
 on and after such date, PROVIDED, HOWEVER, THAT THIS ACT SHALL NOT APPLY
 TO  PROPERTIES  FOR  WHICH THE BUILDING PERMIT FOR CONSTRUCTION HAS BEEN
 ISSUED PRIOR TO SUCH EFFECTIVE DATE, OR WITHIN 180 DAYS OF  SUCH  EFFEC-
 TIVE DATE, PROVIDED THAT SUCH PROJECT RECEIVES A CERTIFICATE OF OCCUPAN-
 CY  WITHIN  24  MONTHS  OF  THE  ISSUANCE OF THE BUILDING PERMIT OR SUCH
 EFFECTIVE DATE, WHICHEVER OCCURS LATER. DAYS FOR WHICH A STOP WORK ORDER
 IS ISSUED DUE TO THE COVID-19 STATE DISASTER EMERGENCY, AS  REQUIRED  BY
 THE  LOCALITY AND/OR EXECUTIVE ORDER OR OTHER LAW, SHALL NOT BE INCLUDED
 IN THE CALCULATION OF THESE TIME PERIODS.
   § 3. This act shall take effect on the  same  date  and  in  the  same
 manner  as a chapter of the laws of 2020, amending the real property tax
 law relating to the residential-commercial urban exemption  program,  as
 proposed  in  legislative  bills  numbers S. 5254-B and A. 8091-A, takes
 effect.