BILL NUMBER: S3311

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the real property tax law, in relation to nonprofit
organizations mandatory class

 
PURPOSE:

The bill will prohibit properties that are in violation of a local
government's zoning laws from receiving a property tax exemption.

 
SUMMARY OF PROVISIONS:

Section one of the bill amends § 420-a of the real property tax law to
prohibit properties that are in violation of a local government's zoning
laws from receiving a property tax exemption.

Section two of the bill relates to the effective date.

 
              

JUSTIFICATION:

There have been several court cases related to the issue of whether
zoning violations should prohibit a property owner from receiving a
property tax exemption.

State courts have held that § 420-a of the real property tax law does
not provide for a property to lose its tax-exempt status simply because
it is in violation of a local zoning law. Under the current interpreta-
tion of § 420-a, a zoning violation can lead to the denial or loss of a
property's tax-exempt status only if the violation relates to the
intended use of the property.

In order to receive a tax exemption benefit, a property should be
required to be in compliance with local zoning laws. Several court deci-
sions have narrowly focused on a property's use in determining eligibil-
ity for tax-exempt status. In so doing, the courts have also ignored the
fact that the properties-at-issue in these cases were in clear violation
of local zoning laws. This bill would amend the law to explicitly state
that any violation of applicable local zoning laws will be grounds to
deny a property of tax-exempt status.

 
LEGISLATIVE HISTORY:

Senate

2017-18: S8133, referred to Local Government

2019-20: S4115, referred to Local Government

2021-22: S39651, referred to Local Government

Assembly

2017-18: A3927-A, referred to ways and means

2019-20: A1976, referred to real property taxation

2021-22: A2011, referred to real property taxation

 
FISCAL IMPLICATIONS:

None

 
EFFECTIVE DATE:
This act shall take effect immediately.