In a number of places in New York State, assessments of residential property frequently have been at a lower percentage of market (full) value than other types of property, such as commercial and industrial property. This is true of the Town of Greenburgh due to the lack of reassessments performed during Mr Feiner's tenure. It's why every tax certiorari challenge submitted had to be paid. More recently, however, condominiums have not been included into this. When a town or city with this situation decided to conduct a property revaluation to achieve correct and fair assessments, the residential properties, as a class, would bear a much larger share of the tax burden. Any additional tax monies collected should be used for paying down Town debt, such as the $5.5 million judgement we incurred after his being found guilty in Federal Court.
This shift in tax burden has discouraged other municipalities with similar situations from conducting their own property revaluations. By the way, Greenburgh hasn't had a revaluation done since the 1950's. Nor has Mr Feiner addressed it during his 24-years as Supervisor. As a result of this concern for tax-burden shifts to homeowners, a State law was passed in 1981 establishing the Homestead Tax Option.
This local option prevents any large shift of the property tax burden to the residential class of property owners after a revaluation. In a revaluation, changes are made to individual property assessments so that they are correct and uniform -- as the law requires. These changes result in increases to some individual residential property owners whose properties were under-assessed before the revaluation. However, the homestead tax option prevents any large shift to the residential class of properties.
Then there is the Homestead Tax Option to establish two separate property tax rates: a lower rate for residential property owners (Homestead tax) and a higher rate for all other property owners (non-Homestead tax). This is strictly elective by each taxing community's leaders. Not surprisingly, Mr Feiner and his Board opted to not do adopt the Homestead Act during their work session when the public is not allowed to comment, criticize or question their decisions. This is a serious issue as to why they would not bring this up at a Town Board meeting and allow the public to weigh-in on this! After Mr Feiner schemed and plotted ways to stall the revaluation, we're not that surprised.
The primary benefactor of Mr Feiner and his Board's decision is that condominium owners will not see a tax increase based on this decision. Concurrently, that means that half of the taxpayers will assume their tax burden. Half, you ask? Yes. Only half of the Unincorporated portion of the Town, actually 48%, is taxed. The rest are tax exempt. The homestead tax is based on the share of property taxes paid by the residential class of property owners in the year before the new assessments from the revaluation project are used.
For example, assume that residential properties paid 40 percent of all town taxes in the Town. Now, as a result of the revaluation, the residential class represents 50 percent of the town’s total taxes. As an “approved assessing unit” that has opted to use the “homestead tax option,” the Town can “freeze” the residential class share of town taxes at the previous 40 percent. Thus, the town will have two tax rates: one for the residential class and another for all other property classes, such as commercial property and industrial property. The difference is that the tax rate for the residential class will be lower than the tax rate for all other property classes. For example, the town tax rate for the residential class might be something like $25 for each $1,000 of assessed valuation, while the tax rate for the nonresidential class might be $30 for each $1,000 of assessed valuation. By passing a local law, approved assessing units can phase in the new revaluation assessments over a five-year period.
To opt out of the Homestead Property Tax system, localities have three options in relation to changing the homestead property tax system. They can make the incremental changes in each class’ share based on their market appreciation subject to the five percent cap as allowed under the law. Or, they can ask the State Legislature to limit the increase in a class’s share. This is generally done to minimize the increase in homestead properties’ class share. Finally, they can opt out of the system by adopting a local law or resolution before the next levy of taxes. Technically, Mr Feiner and his Board followed the letter of the law. We believe, however that he didn't follow the intent. Had he opened this issue up to the public for discussion, the results may have turned out to be the same. Unfortunately, since this is about political expediency, control and re-election, we will never know. These types of subterfuge must end. Only then will we get A Better Greenburgh.