§ 489-ffffff. Conversion of property. 1. Conversion from commercial to
industrial use. Where a property has been granted benefits for
commercial or renovation construction work, but such property is used as
industrial property before the benefits period expires, such property
shall continue to receive benefits for commercial or renovation
construction work.

2. Conversion from industrial use to commercial use. Where a property
has been granted benefits for industrial construction work, and where,
before the benefit period expires, less than seventy-five percent of the
total net square footage is used or held out for use for manufacturing
activities, no further benefits for industrial construction work shall
be provided except as provided in this subdivision. Taxes, together with
interest, shall become due and owing after such date of the use for
purposes other than industrial, except as provided in this subdivision.

(a) Any applicant whose property has been granted a tax abatement
under this title for industrial construction work in a special
commercial abatement area who would have been eligible to receive
benefits for commercial construction work at the time such applicant
applied for benefits shall continue to receive an abatement for
industrial construction work.

(b) Any applicant whose property has been granted benefits under this
title for industrial construction work other than in a special
commercial abatement area who would have been eligible to receive
benefits for commercial construction work at the time such applicant
applied for benefits shall, commencing with the date of conversion to
commercial property and continuing until the expiration of the benefit
period for commercial construction work, receive any abatement which
such applicant would have received in the corresponding tax year
pursuant to the benefits granted for commercial construction work.

(c) Any applicant whose property has been granted benefits under this
title for industrial construction work in any area of the city on whose
property at least sixty-five percent of the net square footage continues
to be used or held out for use for manufacturing activities after
conversion to commercial property, shall not be required to pay the pro
rata share of tax for which an abatement was claimed during the tax year
in which such conversion occurred.

(d) Where the property is receiving the additional industrial
abatement pursuant to paragraph (e) of subdivision three of section four
hundred eighty-nine-bbbbbb of this title, such additional industrial
abatement shall cease from the date of conversion to commercial
property.

3. Conversion to restricted use. Any applicant whose property has been
granted benefits for commercial, industrial or renovation construction
work, and who uses such property for any restricted activity prior to
the expiration of the benefit period, shall cease to be eligible for
further abatement as of the date such property was first used for any
restricted activity. Such recipient of benefits that cease under this
subdivision shall pay with interest any taxes for which an abatement was
claimed after such date, including the pro rata share of tax for which
any abatement was claimed during the tax year in which such use
occurred.

4. Conversion to residential use. (a) Any applicant whose property has
been granted benefits for commercial, industrial or renovation
construction work and who, before the benefit period expires, uses the
property or a portion of the property as residential property, shall
cease to be eligible for further abatement for commercial, industrial or
renovation construction work as of the date such property was first used
as residential property, as follows:

(i) if twenty percent or more of the rentable square footage of the
property is used as residential property, then the entire building shall
cease to be eligible for further abatement;

(ii) if less than twenty percent of the rentable square footage of the
property is used as residential property, then that portion of such
property used as residential property shall cease to be eligible for
further abatement;

(iii) notwithstanding subparagraph (ii) of this paragraph, where less
than five percent of a property's rentable square footage is used as
residential property, that use will be considered de minimus and will
not be a basis for benefits to cease under this subdivision; and

(iv) such recipient of benefits that cease under this subdivision
shall pay, with interest, any taxes for which an abatement was claimed
after the conversion of the property as described in this subdivision,
including the pro rata share of tax for which such abatement was claimed
during the tax year in which such use occurred. The abatement shall
continue for the commercial, industrial or renovation construction work
for the portion of the property that continues to be used for commercial
purposes.

(b) For purposes of paragraph (a) of this subdivision, "property"
means the real property contained by an individual tax lot.

(c) Notwithstanding paragraph (b) of this subdivision, where a
building or structure is owned in condominium form, and an application
for benefits under this title includes more than one property in the
same condominium, then for purposes of this subdivision, the five
percent and twenty percent of the rentable square footage shall be
determined based on the aggregate usage of all such properties.

5. Conversion to retail use. (a) Where a property has been granted
benefits for industrial or commercial construction work in special
commercial abatement areas on buildings where not more than ten percent
of the building or structure is used for retail purposes and where,
before the benefit period expires, the property or a portion thereof is
converted so that ten percent or more of the building or structure is
used for retail purposes, the department shall recalculate the abatement
upon conversion as provided in subdivision six of this section.

(b) Where a property has been granted benefits for renovation
construction work in renovation areas and where, before the benefit
period expires, the property or a portion of the property is converted
so that more than five percent of the building or structure is used for
retail purposes, the department shall recalculate the abatement upon
conversion as provided in subdivision six of this section.

5-a. Conversion of use by peaking units. Any applicant whose property
has been granted benefits under this title for industrial construction
work as a peaking unit and who converts such property in any tax year to
a use that no longer qualifies it as a peaking unit, or who uses such
property in a manner inconsistent with the definition of a peaking unit,
shall be ineligible for abatement benefits during any such tax year. Any
such recipient of benefits shall pay with interest taxes for which an
abatement was claimed during any portion of such tax year.

6. Recalculation of abatement upon conversion. If, during the benefit
period, a recipient converts square footage within any building or
structure, the department may recalculate the benefit granted pursuant
to this title to reflect the benefit for which the current use is
eligible under this title and rules that may be promulgated by the
department.

7. The burden shall at all times be on the recipient to demonstrate by
clear and convincing evidence that property subject to benefits under
this title is used as stated in the preliminary and final applications
for benefits filed by the recipient with the department.