§ 125 — Tax exemptions

New York § 125

• Jurisdiction: New York
• Law PVH: Private Housing Finance
• Art. 5: Redevelopment Companies

Text

§ 125. Tax exemptions. 1. (a) The local legislative body of any\nmunicipality in which a project of such company is or is to be located\nmay by contract agree with any redevelopment company to exempt from\nlocal and municipal taxes, other than assessments for local\nimprovements, all or part of the value of the property included in such\nproject which represents an increase over the assessed valuation of the\nreal property, both land and improvements, acquired for the project at\nthe time of its acquisition by the redevelopment company which\noriginally undertook the project and for such definite period of years\nas such contract may provide, except that where the real property in a\nproject was acquired for purposes of rehabilitation, the local\nlegislative body either may utilize the foregoing formula or may agree\nto exempt from such taxes all or part of the value of the property\nincluded in such project on condition that the amount of such taxes to\nbe paid shall not be less than ten per centum of the annual shelter rent\nor carrying charges of such rehabilitation project. The tax exemption\nshall not operate for a period of more than twenty-five years,\ncommencing in each instance from the date on which the benefits of such\nexemption first become available and effective; provided, however, that\nwith respect to a project either acquired by a mutual redevelopment\ncompany pursuant to section one hundred twenty-six or owned and\ncontinuing to be owned by a mutual redevelopment company which would\nrequire substantial increases in carrying charges after the period of\ntax exemption is ended unless relief is provided, the local legislative\nbody may contract with such mutual redevelopment company to extend such\ntax exemption for not more than twenty-five additional years at a rate\nof tax exemption not to exceed an average of fifty per centum during\nsuch additional period, provided that the tax exemption during the first\ntwo years of such additional period shall continue at the rate of the\ntax exemption of such project immediately preceding the termination of\nthe initial twenty-five year period and that the tax exemption\nthereafter shall be decreased in equal biennial decrements, the first of\nwhich shall occur immediately following such two year period, and\nprovided that such contract shall contain provisions as to income\nlimitations relating to admission and continued occupancy of the project\nand provisions as to rental surcharges to the same effect as are\ncontained in subdivisions two, three, four and five of section\nthirty-one, except that in the case of projects owned and continuing to\nbe owned by mutual redevelopment companies, persons or families whose\nprobable aggregate annual income does not exceed the median income for\nfamilies of the same size in the same metropolitan area shall also be\neligible for admission to the project on the understanding that any\nperson or family becoming eligible by reason hereof whose probable\naggregate annual income at the time of admission or during the period of\noccupancy exceeds, the greater of (i) the median income for such persons\nor families for the metropolitan statistical area in which the project\nis located, or if a project is located outside a metropolitan\nstatistical area, the median income for such persons or families for the\ncounty in which the project is located, as most recently determined by\nthe United States department of housing and urban development, in which\ncase any person or family becoming eligible for admission pursuant to\nthis subparagraph shall pay, from the time of admission, a rental\nsurcharge as provided for in subdivision three of section thirty-one of\nthis chapter, computed on the basis of the income limitations applicable\nto such persons or families in the absence of this subparagraph, or (ii)\nsix times the rental shall be liable for payment of rental surcharges\nhereunder computed on the basis of such ratio, except that in the case\nof families with three or more dependents such ratio shall be seven to\none; and provided further that with respect to a project which is or is\nto be permanently financed by a federally-aided mortgage, the tax\nexemption shall operate for so long as such mortgage is outstanding, but\nin no event for a period of more than forty years, commencing in each\ninstance from the date on which the benefits of such exemption first\nbecome available and effective; and provided further that with respect\nto a project which is or is to be permanently financed by a loan from\nthe New York city housing development corporation, the tax exemption\nshall operate for so long as such loan is outstanding.\n (a-1) Where the redevelopment contract between a mutual redevelopment\ncompany and the local legislative body under which the initial tax\nexemption was granted contains provisions different from those in\nsubdivisions two, three, four and five of section thirty-one of this\nchapter, then a contract to extend the tax exemption for an additional\nperiod under paragraph (a) of this subdivision may provide that those\nprovisions of the redevelopment contract shall continue to apply (with\nsuch modifications as the supervising agency of such mutual\nredevelopment company shall approve) during the additional period as if\nsuch additional period were the initial period of tax exemption for such\nmutual redevelopment company, notwithstanding the provisions of\nparagraph (a) of this subdivision to the contrary.\n (a-2) Any inconsistent provision of law notwithstanding, in a city\nhaving a population of one million or more, where a local legislative\nbody has acted to extend the tax exemption of a mutual redevelopment\ncompany for an additional twenty-five years after the initial tax\nexemption period has expired, the local legislative body may authorize\ntax exemption during the final eleven years of such additional\ntwenty-five year exemption period under this subdivision, provided that\nthe amount of taxes to be paid by the mutual redevelopment company\nduring the final eleven years of such additional twenty-five year\nexemption period shall not be less than an amount equal to the greater\nof (i) ten per centum of the annual rent or carrying charges of the\nproject minus utilities for the residential portion of the project, or\n(ii) the taxes payable by such company for the residential portion of\nthe project in the fourteenth year of such additional twenty-five year\nexemption period, and may further extend the period of such additional\ntwenty-five year exemption for up to a total period of thirty-five years\nfrom the date of expiration of the initial tax exemption, provided that\nthe amount of taxes to be paid by the mutual redevelopment company\nduring any such extension beyond such additional twenty-five year\nexemption period shall not be less than an amount equal to the greater\nof (i) ten per centum of the annual rent or carrying charges of the\nproject minus utilities for the residential portion of the project, or\n(ii) the taxes payable by such company for the residential portion of\nthe project in the fourteenth year of such additional twenty-five year\nexemption period.\n (a-3) Any inconsistent provision of law notwithstanding, the local\nlegislative body of any municipality may grant an additional tax\nexemption period for any project, other than a project by a mutual\nredevelopment company, that received a tax exemption under paragraph (a)\nof this subdivision, upon the expiration of the tax exemption period.\nThe additional tax exemption period may be for a term of forty years, or\nuntil such time as the project is no longer operated under the\nrestrictions and for the purposes set forth in this article, whichever\nis sooner. Unless otherwise approved by the local legislative body, the\namount of taxes paid by the redevelopment company during such additional\ntax exemption period shall not be less than (i) the taxes payable by\nsuch company in accordance with the resolution for such redevelopment\ncompany that was approved by the local legislative body and that was in\neffect immediately prior to the expiration of the initial tax exemption\nperiod, or (ii) if there is no such resolution, the taxes payable by\nsuch company in accordance with the exemption authorized pursuant to\nthis article immediately prior to the expiration of the initial tax\nexemption period.\n (a-4) Any inconsistent provision of law notwithstanding, in a city\nhaving a population of one million or more, where a local legislative\nbody has acted to extend the tax exemption of a mutual redevelopment\ncompany for the maximum period provided for in paragraph (a-2) of this\nsubdivision, the local legislative body may grant an additional tax\nexemption for a period of up to fifty years, provided that the amount of\ntaxes to be paid during any such period of tax exemption shall be not\nless than an amount equal to the lesser of (i) five per centum of the\nannual rent or carrying charges of the project minus utilities for the\nresidential portion of the project, or (ii) the taxes payable by such\ncompany for the residential portion of the project during the tax year\ncommencing July first, two thousand and ending on June thirtieth, two\nthousand one. Such grant of an additional tax exemption period shall\ntake effect upon the expiration of the maximum period provided for in\nparagraph (a-2) of this subdivision.\n (a-5) Any inconsistent provision of law notwithstanding, including but\nnot limited to any limitation in paragraph (a) of this subdivision, the\nlocal legislative body of any municipality within the County of Nassau,\nwith respect to a project either: (i) acquired by a mutual redevelopment\ncompany pursuant to section one hundred twenty-six of this article; or\n(ii) owned and continuing to be owned by a mutual redevelopment company\nwhere there is a restriction that said housing must be occupied by\nseniors with a minimum age of fifty-five as a condition to any\nrestrictive covenants of said mutual redevelopment company, which would\nrequire substantial increases in carrying or maintenance charges after\nthe initial period of tax exemption is ended or is going to require\nincreases in the carrying or maintenance charges during any such\nextended tax exemption pursuant to a present extension agreement due to\nthe reduction or elimination of the tax exemption provided to the\nproject immediately preceding the termination of the initial twenty-five\nyear period, unless relief is provided, may contract with such mutual\nredevelopment company to: (i) extend such tax exemption for not more\nthan twenty-five additional years at the rate of the tax exemption of\nsuch project immediately preceding the termination of the initial\ntwenty-five year period for all of the additional twenty-five year\nperiod; or (ii) modify an existing extended tax exemption to provide for\nsuch an extension.\n (b) A redevelopment company which has been granted and has received\ntax exemption pursuant to this section may at any time elect to pay to\nthe municipality or other appropriate taxing jurisdiction the total of\nall accrued taxes for which exemption was granted and received, together\nwith interest at the rate of five per centum per annum. Upon such\npayment the tax exemption of the project shall thereupon cease and\nterminate.\n (c) Where a municipality acts on behalf of another taxing jurisdiction\nin assessing real property for the purpose of taxation, or in levying\ntaxes therefor, the said agreement by the local legislative body of such\nmunicipality shall have the effect of exempting the real property in a\nproject from local and municipal taxes, other than assessments for local\nimprovements, levied by or in behalf of both such taxing jurisdictions.\n (d) As used in this subdivision the term "taxing jurisdiction" means\nany municipal corporation or district corporation, including any school\ndistrict or any special district, having the power to levy or collect\ntaxes and benefit assessments upon real property, or in whose behalf\nsuch taxes or benefit assessments may be levied or collected.\n 2. Any inconsistent provision of law notwithstanding, mortgages of any\nsuch company issued to the federal government or any instrumentality\nthereof, or to any municipal housing authority or other public housing\nagency or instrumentality thereof whose obligations are determined to be\nexempt from federal taxation by the federal government, or issued to a\nfinancial institution and insured or guaranteed by the federal housing\nadministrator or any other instrumentality of the federal government\nshall be exempt from the mortgage recording taxes imposed by article\neleven of the tax law.\n