NY State Senate Bill 2025-S2320

Senate Bill S2320

2025-2026 Legislative Session

Changes the amount of the exemption permitted for capital improvements to residential buildings

download bill text pdf

Current Bill Status - In Senate Committee Housing, Construction And Community Development Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 16, 2025	referred to housing, construction and community development

2025-S2320 (ACTIVE) - Details

Current Committee:: Senate Housing, Construction And Community Development
Law Section:: Real Property Tax Law
Laws Affected:: Amd §421-f, RPT L

2025-S2320 (ACTIVE) - Summary

Changes the amount of the exemption permitted for capital improvements to residential buildings to $200,000 where a local law or resolution is adopted on or after January 1, 2026.

2025-S2320 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S2320

SPONSOR: FAHY
 
TITLE OF BILL:

An act to amend the real property tax law, in relation to changing the
amount of the exemption permitted for capital improvements to residen-
tial buildings

 
PURPOSE:

To increase the amount permitted for capital improvements to residential
buildings from eighty thousand dollars to two hundred thousand dollars

 
SUMMARY OF SPECIFIC PROVISIONS:

Amends subsection 421-f of the real property tax law

 
JUSTIFICATION:

This bill addresses the critical need to update the capital improvement

exemption threshold to reflect current economic realities in New York
State's residential real estate market. The existing $80,000 cap, which
has remained unchanged for years, no longer adequately accounts for the
substantial increase in construction costs, material prices, and overall
property values across the state.

Rising inflation and supply chain challenges have significantly
increased the cost of home improvements, making the current exemption
limit insufficient for many necessary renovation projects. By increasing
the threshold to $200,000, this amendment will encourage homeowners to
invest in meaningful improvements to their properties, which will help
maintain and enhance the state's housing stock.

This update will particularly benefit middle-class homeowners who wish
to modernize aging homes, improve energy efficiency, or make necessary
structural improvements. The increased exemption will also stimulate
local economies by encouraging construction projects, supporting skilled
labor jobs, and generating economic activity in related industries.

 
LEGISLATIVE HISTORY:

A2563 of 2019-20

A3121 of 2021-22

A3889 of 2023-24

 
FISCAL IMPLICATIONS:

To be determined.

 
EFFECTIVE DATE:
This bill will take effective immediately.

2025-S2320 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2320
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             January 16, 2025
                                ___________
 
 Introduced  by  Sen.  FAHY  --  read twice and ordered printed, and when
   printed to be committed to the Committee on Housing, Construction  and
   Community Development
 
 AN  ACT  to amend the real property tax law, in relation to changing the
   amount of the exemption permitted for capital improvements to residen-
   tial buildings

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.    Subparagraph (iii) of paragraph (a) of subdivision 2 of
 section 421-f of the real property tax law, as amended by section  3  of
 part  WW  of  chapter  55  of  the  laws  of 2021, is amended to read as
 follows:
   (iii) [Except] FOR EXEMPTIONS GRANTED PURSUANT  TO  THIS  SECTION  AND
 AUTHORIZED  BY A LOCAL LAW OR RESOLUTION ADOPTED PRIOR TO JANUARY FIRST,
 TWO THOUSAND TWENTY-SIX, EXCEPT in a special assessing unit that is  not
 a  city,  such  exemption shall be limited to eighty thousand dollars in
 increased market value, or such other  sum  less  than  eighty  thousand
 dollars,  but  not less than five thousand dollars as may be provided by
 the local law or resolution, of the property attributable to such recon-
 struction, alteration or improvement and any increase  in  market  value
 greater  than such amount shall not be eligible for the exemption pursu-
 ant to this section. In a special assessing unit that  is  not  a  city,
 [the  exemption shall be limited to seven hundred fifty thousand dollars
 in increased market value]  FOR  EXEMPTIONS  GRANTED  PURSUANT  TO  THIS
 SECTION  AND AUTHORIZED BY A LOCAL LAW OR RESOLUTION ADOPTED ON OR AFTER
 JANUARY FIRST, TWO THOUSAND TWENTY-SIX, SUCH EXEMPTION SHALL BE  LIMITED
 TO TWO HUNDRED THOUSAND DOLLARS IN INCREASED MARKET VALUE, OR SUCH OTHER
 SUM LESS THAN TWO HUNDRED THOUSAND DOLLARS, BUT NOT LESS THAN FIVE THOU-
 SAND  DOLLARS  AS MAY BE PROVIDED BY THE LOCAL LAW OR RESOLUTION, OF THE
 PROPERTY ATTRIBUTABLE TO SUCH RECONSTRUCTION, ALTERATION OR  IMPROVEMENT
 AND  ANY  INCREASE IN MARKET VALUE GREATER THAN SUCH AMOUNT SHALL NOT BE
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD04819-01-5

 S. 2320                             2
 
 ELIGIBLE FOR THE EXEMPTION PURSUANT TO THIS SECTION.   For the  purposes
 of  this  section, the market value of the reconstruction, alteration or
 improvement, or new construction as authorized by subdivision  one-a  of
 this  section,  shall be equal to the increased assessed value attribut-
 able to such reconstruction, alteration, improvement or new construction
 divided by the class one ratio in a special assessing unit or  the  most
 recently  established  state  equalization  rate or special equalization
 rate in the remainder of the state, except where the state  equalization
 rate or special equalization rate equals or exceeds ninety-five percent,
 in which case the increase in assessed value attributable to such recon-
 struction,  alteration,  improvement or new construction shall be deemed
 to equal the market value of such reconstruction, alteration or improve-
 ment.
   § 2. Subparagraph (iii) of paragraph (a) of subdivision 2  of  section
 421-f  of  the  real  property tax law, as amended by chapter 590 of the
 laws of 1994, is amended to read as follows:
   (iii) [Such] FOR EXEMPTIONS  GRANTED  PURSUANT  TO  THIS  SECTION  AND
 AUTHORIZED  BY A LOCAL LAW OR RESOLUTION ADOPTED PRIOR TO JANUARY FIRST,
 TWO THOUSAND TWENTY-SIX, SUCH exemption shall be limited to eighty thou-
 sand dollars in increased market value, or  such  other  sum  less  than
 eighty  thousand dollars, but not less than five thousand dollars as may
 be provided by the local law or resolution, of the property attributable
 to such reconstruction, alteration or improvement and  any  increase  in
 market  value  greater  than  such  amount shall not be eligible for the
 exemption pursuant to this section.  FOR EXEMPTIONS GRANTED PURSUANT  TO
 THIS  SECTION  AND AUTHORIZED BY A LOCAL LAW OR RESOLUTION ADOPTED ON OR
 AFTER JANUARY FIRST, TWO THOUSAND TWENTY-SIX, SUCH  EXEMPTION  SHALL  BE
 LIMITED  TO  TWO  HUNDRED THOUSAND DOLLARS IN INCREASED MARKET VALUE, OR
 SUCH OTHER SUM LESS THAN TWO HUNDRED THOUSAND DOLLARS, BUT NOT LESS THAN
 FIVE THOUSAND DOLLARS AS MAY BE PROVIDED BY THE LOCAL LAW OR RESOLUTION,
 OF THE PROPERTY  ATTRIBUTABLE  TO  SUCH  RECONSTRUCTION,  ALTERATION  OR
 IMPROVEMENT  AND  ANY  INCREASE IN MARKET VALUE GREATER THAN SUCH AMOUNT
 SHALL NOT BE ELIGIBLE FOR THE EXEMPTION PURSUANT TO  THIS  SECTION.  For
 the  purposes  of  this section, the market value of the reconstruction,
 alteration or improvement shall be equal to the increased assessed value
 attributable to such reconstruction, alteration or  improvement  divided
 by  the  class  I ratio in a special assessing unit or the most recently
 established state equalization rate or special equalization rate in  the
 remainder  of  the  state,  except  where the state equalization rate or
 special equalization rate equals  or  exceeds  ninety-five  percent,  in
 which  case  the  increase in assessed value attributable to such recon-
 struction, alteration or improvement shall be deemed to equal the market
 value of such reconstruction, alteration or improvement.
   § 3. This act shall take effect immediately; provided,  however,  that
 the  amendments  to  subdivision 2 of section 421-f of the real property
 tax law made by section one of this act shall be subject to the  expira-
 tion  and reversion of such subdivision pursuant to section 7 of part WW
 of chapter 55 of the laws of 2021, as amended, when upon such  date  the
 provisions of section two of this act shall take effect.

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