§ 421-f. * Exemption of capital improvements to residential buildings
and certain new construction.

* NB Effective until January 1, 2026

* Exemption of capital improvements to residential buildings.

* NB Effective January 1, 2026
1. Residential buildings reconstructed, altered or improved subsequent
to the effective date of a local law or resolution pursuant to this
section shall be exempt from taxation and special ad valorem levies to
the extent provided hereinafter. After a public hearing, the governing
board of a county, city, town or village may adopt a local law and a
school district, other than a school district subject to article
fifty-two of the education law, may adopt a resolution to grant the
exemption authorized pursuant to this section. A copy of such local law
or resolution shall be filed with the commissioner and the assessor of
such county, city, town or village who prepares the assessment roll on
which the taxes of such county, city, town, village or school district
are levied.

* 1-a. Buildings classified as class one property in section eighteen
hundred two of this chapter reconstructed, altered, improved, or newly
constructed in a special assessing unit that is not a city shall be
exempt from taxation and special ad valorem levies to the extent
provided hereinafter in the same manner and to the same extent to
county, town, special district and school district taxes levied on the
assessment roll prepared by such special assessing unit. Additional
buildings and yard improvements shall be excluded from receiving this
exemption. An application shall not be required to receive the
exemption.

* NB Repealed January 1, 2026

* 2. (a) Such buildings shall be exempt for a period of one year to
the extent of one hundred per centum of the increase in assessed value
thereof attributable to such reconstruction, alteration or improvement,
and new construction pursuant to subdivision one-a of this section, and
for an additional period of seven years subject to the following:

(i) The extent of such exemption shall be decreased by twelve and
one-half per centum of the "exemption base" each year during such
additional period. The "exemption base" shall be the increase in
assessed value as determined in the initial year of the term of the
exemption, except as provided in subparagraph (ii) of this paragraph.

(ii) In any year in which a change in level of assessment of fifteen
percent or more is certified for a final assessment roll pursuant to the
rules of the commissioner, the exemption base shall be multiplied by a
fraction, the numerator of which shall be the total assessed value of
the parcel on such final assessment roll (after accounting for any
physical or quantity changes to the parcel since the immediately
preceding assessment roll), and the denominator of which shall be the
total assessed value of the parcel on the immediately preceding final
assessment roll. The result shall be the new exemption base. The
exemption shall thereupon be recomputed to take into account the new
exemption base, notwithstanding the fact that the assessor receives
certification of the change in level of assessment after the completion,
verification and filing of the final assessment roll. In the event the
assessor does not have custody of the roll when such certification is
received, the assessor shall certify the recomputed exemption to the
local officers having custody and control of the roll, and such local
officers are hereby directed and authorized to enter the recomputed
exemption certified by the assessor on the roll. The assessor shall give
written notice of such recomputed exemption to the property owner, who
may, if he or she believes that the exemption was recomputed
incorrectly, apply for a correction in the manner provided by title
three of article five of this chapter for the correction of clerical
errors.

(iii) 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 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. 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 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 attributable 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 reconstruction, alteration,
improvement or new construction shall be deemed to equal the market
value of such reconstruction, alteration or improvement.

(b) Except in a special assessing unit that is not a city, no such
exemption shall be granted for reconstruction, alterations or
improvements unless:

(i) such reconstruction, alteration or improvement was commenced
subsequent to the effective date of the local law or resolution adopted
pursuant to subdivision one of this section; and

(ii) the value of such reconstruction, alteration or improvement
exceeds three thousand dollars; and

(iii) the greater portion, as so determined by square footage, of the
building reconstructed, altered or improved is at least five years old.

(c) For purposes of this section the terms reconstruction, alteration
and improvement shall not include ordinary maintenance and repairs.

* NB Effective until January 1, 2026

* 2. (a) Such buildings shall be exempt for a period of one year to
the extent of one hundred per centum of the increase in assessed value
thereof attributable to such reconstruction, alteration or improvement
and for an additional period of seven years subject to the following:

(i) The extent of such exemption shall be decreased by twelve and
one-half per centum of the "exemption base" each year during such
additional period. The "exemption base" shall be the increase in
assessed value as determined in the initial year of the term of the
exemption, except as provided in subparagraph (ii) of this paragraph.

(ii) In any year in which a change in level of assessment of fifteen
percent or more is certified for a final assessment roll pursuant to the
rules of the commissioner, the exemption base shall be multiplied by a
fraction, the numerator of which shall be the total assessed value of
the parcel on such final assessment roll (after accounting for any
physical or quantity changes to the parcel since the immediately
preceding assessment roll), and the denominator of which shall be the
total assessed value of the parcel on the immediately preceding final
assessment roll. The result shall be the new exemption base. The
exemption shall thereupon be recomputed to take into account the new
exemption base, notwithstanding the fact that the assessor receives
certification of the change in level of assessment after the completion,
verification and filing of the final assessment roll. In the event the
assessor does not have custody of the roll when such certification is
received, the assessor shall certify the recomputed exemption to the
local officers having custody and control of the roll, and such local
officers are hereby directed and authorized to enter the recomputed
exemption certified by the assessor on the roll. The assessor shall give
written notice of such recomputed exemption to the property owner, who
may, if he or she believes that the exemption was recomputed
incorrectly, apply for a correction in the manner provided by title
three of article five of this chapter for the correction of clerical
errors.

(iii) 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
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 reconstruction, alteration or improvement
shall be deemed to equal the market value of such reconstruction,
alteration or improvement.

(b) No such exemption shall be granted for reconstruction, alterations
or improvements unless:

(i) such reconstruction, alteration or improvement was commenced
subsequent to the effective date of the local law or resolution adopted
pursuant to subdivision one of this section; and

(ii) the value of such reconstruction, alteration or improvement
exceeds three thousand dollars; and

(iii) the greater portion, as so determined by square footage, of the
building reconstructed, altered or improved is at least five years old.

(c) For purposes of this section the terms reconstruction, alteration
and improvement shall not include ordinary maintenance and repairs.

* NB Effective January 1, 2026

* 3. Except in a special assessing unit that is not a city, such
exemption shall be granted only upon application by the owner of such
building on a form prescribed by the commissioner. The application shall
be filed with the assessor of the city, town, village or county having
the power to assess property for taxation on or before the appropriate
taxable status date of such city, town, village or county. In a special
assessing unit that is not a city, the exemption shall be applied based
upon that completion of reconstruction, alteration, improvement or new
construction on or before the applicable taxable status date of the
special assessing unit; provided, however that the exemption for such
reconstruction, alteration, improvement or new construction that
occurred after the taxable status date of such special assessing unit
for the two thousand nineteen -- two thousand twenty assessment roll and
on or before the taxable status date of such special assessing unit for
the two thousand twenty -- two thousand twenty-one assessment roll shall
be applied beginning with the two thousand twenty-one -- two thousand
twenty-two assessment roll.

* NB Effective until January 1, 2026

* 3. Such exemption shall be granted only upon application by the
owner of such building on a form prescribed by the commissioner. The
application shall be filed with the assessor of the city, town, village
or county having the power to assess property for taxation on or before
the appropriate taxable status date of such city, town, village or
county.

* NB Effective January 1, 2026

4. If satisfied that the applicant is entitled to an exemption
pursuant to this section, the assessor shall approve the application and
such building shall thereafter be exempt from taxation and special ad
valorem levies as herein provided commencing with the assessment roll
prepared on the basis of the taxable status date referred to in
subdivision three of this section. 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.

* 5. For the purposes of this section, except in a special assessing
unit that is not a city, a residential building shall mean any building
or structure designed and occupied exclusively for residential purposes
by not more than two families.

* NB Effective until January 1, 2026

* 5. For the purposes of this section, a residential building shall
mean any building or structure designed and occupied exclusively for
residential purposes by not more than two families.

* NB Effective January 1, 2026

* 6. In the event that a building granted an exemption pursuant to
this section ceases to be used primarily for residential purposes, is no
longer classified as class one property in a special assessing unit that
is not a city, or title thereto is transferred to other than the heirs
or distributees of the owner in other than a special assessing unit that
is not a city, the exemption granted pursuant to this section shall
cease.

* NB Effective until January 1, 2026

* 6. In the event that a building granted an exemption pursuant to
this section ceases to be used primarily for residential purposes or
title thereto is transferred to other than the heirs or distributees of
the owner, the exemption granted pursuant to this section shall cease.

* NB Effective January 1, 2026

* 7. (a) Except for a special assessing unit that is not a city, a
county, city, town or village may, by its local law, or school district,
by its resolution:

(i) reduce the per centum of exemption otherwise allowed pursuant to
this section;

(ii) limit eligibility for the exemption to those forms of
reconstruction, alterations or improvements as are prescribed in such
local law or resolution;

(iii) provide that the exemption shall be applicable only to those
improvements which would otherwise result in an increase in the assessed
valuation of the real property but which consist of an addition,
remodeling or modernization to an existing residential structure to
prevent physical deterioration of the structure or to comply with
applicable building, sanitary, health and/or fire codes.

(b) No such local law or resolution shall reduce or repeal an
exemption granted pursuant to this section until the expiration of the
period for which such exemption was granted.

* NB Effective until January 1, 2026

* 7. (a) A county, city, town or village may, by its local law, or
school district, by its resolution:

(i) reduce the per centum of exemption otherwise allowed pursuant to
this section;

(ii) limit eligibility for the exemption to those forms of
reconstruction, alterations or improvements as are prescribed in such
local law or resolution;

(iii) provide that the exemption shall be applicable only to those
improvements which would otherwise result in an increase in the assessed
valuation of the real property but which consist of an addition,
remodeling or modernization to an existing residential structure to
prevent physical deterioration of the structure or to comply with
applicable building, sanitary, health and/or fire codes.

(b) No such local law or resolution shall reduce or repeal an
exemption granted pursuant to this section until the expiration of the
period for which such exemption was granted.

* NB Effective January 1, 2026

8. The provisions of this section shall not apply to a city with a
population of more than one million.