§ 33 — Tax exemptions

New York § 33

• Jurisdiction: New York
• Law PVH: Private Housing Finance
• Art. 2: Limited-profit Housing Companies

Text

§ 33. Tax exemptions. 1. (a) Upon the consent of the local legislative\nbody of any municipality in which a project is or is to be located, the\nreal property in a project shall be exempt from local and municipal\ntaxes, other than assessments for local improvements, to the extent of\nall or part of the value of the property included in such project which\nrepresents an increase over the assessed valuation of the real property,\nboth land and improvements, acquired for the project at the time of its\nacquisition by the limited-profit housing company, provided, however,\nthat the real property in a project acquired for purposes of\nrehabilitation shall be exempt to the extent of all or part of the value\nof the property included in such project, and further provided that the\namount of such taxes to be paid shall not be less than ten per centum of\nthe annual shelter rent or carrying charges of such project except that\nfor projects located or to be located in a city of a population of one\nmillion or more, the amount of such taxes shall be no more than five per\ncentum of the annual shelter rent or carrying charges of the project.\nUpon the consent of the local legislative body of a municipality, other\nthan a city with a population of one million or more, in which the\nproject is located, the amount of such taxes may be further reduced to\nfive per centum or less of the annual shelter rent or carrying charges\nof the project. Any such granted consent to reduce the amount of such\ntaxes shall expire every ten years. If such authorization is not\nrenewed, the rate of taxation shall revert to the level established\nbefore the consent was granted. Shelter rent shall mean the total rents\nreceived from the occupants of a project less the cost of providing to\nthe occupants electricity, gas, heat and other utilities. Total rents\nshall include rent supplements and subsidies received from the federal\ngovernment, the state or a municipality on behalf of such occupants but\nshall not include interest reduction payments pursuant to subdivision\n(a) of section two hundred one of the Federal Housing and Urban\nDevelopment Act of nineteen hundred sixty-eight. The tax exemption shall\noperate and continue so long as the mortgage loans of the company,\nincluding any additional mortgage loan the proceeds of which are used\nprimarily for the residential portion of the project, which additional\nloan is approved by the commissioner or the supervising agency, are\noutstanding.\n (b) 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 consent of 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 As used in this paragraph, the term "taxing jurisdiction" means any\nmunicipal 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 (c) Notwithstanding the provisions of paragraphs (a) and (b) of this\nsubdivision, the real property of a state urban development corporation\nproject acquired, owned, constructed, managed or operated by a company\nincorporated pursuant to the not-for-profit corporation law and this\narticle shall be entitled to all the benefits provided by section four\nhundred twenty-two of the real property tax law. The real property of a\nstate urban development corporation project, other than a state urban\ndevelopment corporation project acquired, owned, constructed, managed or\noperated by a company incorporated pursuant to the not-for-profit\ncorporation law and this article, shall be exempt from all local and\nmunicipal taxes, other than assessments for local improvements, to the\nextent of the value of the property included in such project as\nrepresents an increase over the assessed valuation of the real property,\nboth land and improvements, acquired for the project on the date of its\nacquisition by the limited-profit housing company, provided that the\namount of such taxes to be paid shall not be less than ten per centum of\nthe annual shelter rent or carrying charges of such project, as defined\nin paragraph (a) hereof, except that in a city with a population of one\nmillion or more, the amount of such taxes shall be no more than five per\ncentum of the annual shelter rent or carrying charges of the project.\nUpon the consent of the local legislative body of the municipality,\nother than a city with a population of one million or more, in which the\nproject is located, the amount of such taxes may be further reduced to\nfive per centum or less of the annual shelter rent or carrying charges\nof the project. Any such granted consent to reduce the amount of such\ntaxes shall expire every ten years. If such authorization is not\nrenewed, the rate of taxation shall revert to the level established\nbefore the consent was granted. The tax exemption shall operate and\ncontinue so long as the mortgage loans of such limited profit housing\ncompany, including any additional mortgage loan the proceeds of which\nare used primarily for the residential portion of the project, which\nadditional loan is approved by the commissioner or the supervising\nagency, are outstanding and the project is continued to be operated as a\nlimited-profit housing project. If a state urban development corporation\nproject qualifying for tax exemption pursuant to this paragraph is sold,\nwith the approval of the commissioner, to another limited-profit housing\ncompany, such successor company shall be entitled to all the benefits of\nthis paragraph. In the event that such sale is to a company incorporated\npursuant to the not-for-profit corporation law and this article, such\nsuccessor company shall be entitled to all the benefits provided by\nsection four hundred twenty-two of the real property tax law.\n (d) Notwithstanding the provisions of paragraphs (a) and (b) of this\nsubdivision, when a project is financed with a mortgage loan pursuant to\nthis article or article three of this chapter and (i) there is a\nparticipation, new loan or investment pursuant to section twenty-three-b\nof this article or (ii) such mortgage loan is assigned, modified or\nsatisfied pursuant to section twenty-three-a or forty-four-b or\nsubdivision twenty-two-a of section six hundred fifty-four of this\nchapter, the real property of the project shall be exempt from all local\nand municipal taxes, other than assessments for local improvements, to\nthe extent of the value of the real property included in such project\nwhich represents an increase over the assessed valuation of the real\nproperty, both land and improvements, acquired for the project on the\ndate of its original acquisition for the project by the original\nmortgagor under a mortgage loan pursuant to this article or article\nthree of this chapter, provided that the amount of taxes to be paid on\nthe project shall not be less than ten per centum of the annual shelter\nrent or carrying charges of such project, as defined in paragraph (a) of\nthis subdivision, except that in a city with a population of one million\nor more, the amount of such taxes shall be no more than five per centum\nof the annual shelter rent or carrying charges of the project. Upon the\nconsent of the local legislative body of the municipality, other than a\ncity with a population of one million or more, in which the project is\nlocated, the amount of such taxes may be further reduced to five per\ncentum or less of the annual shelter rent or carrying charges of the\nproject. Any such granted consent to reduce the amount of such taxes\nshall expire every ten years. If such authorization is not renewed, the\nrate of taxation shall revert to the level established before the\nconsent was granted. Such tax exemption shall commence in each instance\nfrom the date when the project becomes subject to a mortgage insured by\nthe federal government and shall operate and continue so long as a\nmortgage on such project is insured or held by the federal government or\nso long as the project is thereafter owned by the federal government or\nso long as any residual indebtedness is outstanding, whichever is\nlonger. When there is a participation, new loan or investment pursuant\nto section twenty-three-b of this article, such participation, new loan\nor investment shall be deemed to be the equivalent of a federally\ninsured mortgage for purposes of this paragraph. Nothing contained in\nthis paragraph shall be construed to limit or otherwise impair the\nbenefits available to any company eligible for exemption from taxation\npursuant to section thirty-one or section thirty-six-a of this article,\nsection four hundred twenty-two or section four hundred sixty-seven-c of\nthe real property tax law, or section fifty-eight of the public housing\nlaw. The foregoing shall not be deemed to authorize any company to\nreceive the benefits of any exemption from taxation in contravention of\nthe provisions of section two of article eighteen of the constitution.\n (e) Notwithstanding the provisions of paragraph (a) of this\nsubdivision, a municipality, with the approval of the local legislative\nbody, may contract to exclude all or part of any rent subsidies received\nfrom the federal government pursuant to section eight of the United\nStates Housing Act of nineteen hundred thirty-seven as amended in the\ncomputation of total rents received.\n (f) Notwithstanding the provisions of paragraph (a) of this\nsubdivision, if the number of units occupied by persons receiving the\nbenefit of rental assistance payments from the federal government\npursuant to section eight of the United States Housing Act of nineteen\nhundred thirty-seven, as amended, with respect to any project increases\nby more than one hundred percent within any twelve consecutive months\nprior to nineteen hundred eighty-five over the number of units for which\nsuch subsidies were available during the preceding twelve consecutive\nmonths or as July first, nineteen hundred eighty, whichever is later,\ntaxes payable for such additional subsidized units and subsequent units\nsubsidized in the same manner shall be based solely upon that portion of\ntotal rents received on account of such additional subsidized units that\nis not funded by such rental assistance payments, provided, however,\nthat no project shall receive such additional tax exemption (i) unless a\nminimum of seventeen percent of the units in the project receive the\nbenefit of such subsidies, or (ii) if any mortgage on such project is\ninsured or held by the federal government or if the project is owned by\nthe federal government. The amount of exemption to which a project is\nentitled pursuant to this paragraph shall be certified annually by the\ncommissioner or the supervising agency, as the case may be.\n 2. Notwithstanding the provisions of subdivision one hereof, whenever\na dwelling in a project is leased to the New York state housing finance\nagency pursuant to the provisions of section forty-four-a of this\nchapter, so much of the assessed value of such project attributable to\nsuch dwelling (including a pro rata portion of the value of the land and\ncommon spaces) as represents an increase over the proportionate assessed\nvalue of the real property, both land and improvements, acquired for\nsuch project at the time of original acquisition therefor, shall be\nexempt during the period of such lease from taxation for county, city,\ntown, village and school district purposes and special ad valorem\nlevies; provided that if in any year the aggregate amount of such taxes\nand levies that would have been attributable to such dwelling but for\nthe exemption provided by this subdivision exceeds the amount payable\nout of the low rent lease account pursuant to subdivision three of\nsection forty-four-a of this chapter with respect to the agency's rent\nobligation for such dwelling, the agency shall make proportional\npayments in lieu of such taxes and levies to the appropriate county,\ncity, town, village, school district or special district, or any\ncombination thereof as the case may be, in an aggregate amount equal to\none half of the sum of (a) the amount of such excess and (b) the amount,\nif any, by which the rent paid to the agency under the sublease for such\ndwelling exceeds the agency's rent obligation for such dwelling. Nothing\ncontained in this subdivision shall preclude the increase of the taxable\nassessed value attributable to such dwellings as a result of a net\nincrease in the assessed valuation of the taxable property in the\nassessing unit as a result of assessing such property at a higher ratio\nof full value.\n 3. Notwithstanding the provisions of subdivision one hereof, whenever\na dwelling in a project is leased to an authority, pursuant to the\nprovisions of sections seventeen and thirty-one of this chapter, so much\nof the assessed value of such project attributable to such dwelling\n(including a pro rata portion of the value of the land and common\nspaces) as represents an increase over the proportionate assessed value\nof the real property, both land and improvements, acquired for such\nproject at the time of original acquisition therefor, shall be exempt\nduring the period of such lease from taxation for county, city, town,\nvillage and school district purposes and special ad valorem levies.\nNothing contained in this subdivision shall preclude the increase of the\ntaxable assessed value attributable to such dwelling as a result of a\nnet increase in the assessed valuation of the taxable property in the\nassessing unit as a result of assessing such property at a higher ratio\nof full value.\n 4. Notwithstanding the provisions of subdivision one hereof, when a\nmutual company is organized under this article to facilitate the\nacquisition of a building by residents thereof, the amount of local and\nmunicipal taxes, other than assessments for local improvements, to be\npaid on the real property included in such project, both land and\nimprovements, shall not exceed twenty per centum of the annual shelter\nrent or carrying charges of such project, as defined in paragraph (a) of\nsubdivision one hereof; provided, however, that where such acquisition\nof a building by residents thereof involves the financing of\nrehabilitation or other improvement as well as acquisition, upon the\nconsent of the local legislative body of the municipality in which the\nproject is located the amount of such taxes may be further reduced\nprovided that such amount shall not be less than ten per centum of the\nannual shelter rent or carrying charges of the project, as defined in\nparagraph (a) of subdivision one hereof; or the company may in lieu of\nrequesting such consent apply for the benefits of the local law, if any,\nenacted pursuant to section four hundred eighty-nine of the real\nproperty tax law. Notwithstanding any other provision of this\nsubdivision, in a city with a population of one million or more, the\namount of such taxes shall be no more than five per centum of the annual\nshelter rent or carrying charges of the project. Upon the consent of the\nlocal legislative body of the municipality, other than a city with a\npopulation of one million or more, in which the project is located, the\namount of such taxes may be further reduced to five per centum or less\nof the annual shelter rent or carrying charges of the project. Any such\ngranted consent to reduce the amount of such taxes shall expire every\nten years. If such authorization is not renewed, the rate of taxation\nshall revert to the level established before the consent was granted.\nSuch tax exemption, if any, granted pursuant to this article shall\noperate and continue so long as a loan made under this article or any\nsubsequent loan approved by the commissioner or the supervising agency\nto enhance the residential portion of the project and the project is\ncontinued to be operated for the purposes set forth in this article is\noutstanding.\n 5. Bonds, mortgages, notes, income debentures and obligations of a\ncompany are declared to be issued for a public purpose and to be public\ninstrumentalities and together with interest thereon shall be exempt\nfrom tax including but not limited to the mortgage recording taxes\nimposed by article eleven of the tax law.\n 6. Any project that received a tax exemption under paragraphs (a), (c)\nand (d) of subdivision one, and subdivision four of this section may,\nupon the expiration of the tax exemption period, be granted an\nadditional tax exemption period of up to fifty years, or until such time\nas the project is no longer operated under the restrictions and for the\npurposes set forth in this article, whichever is sooner.\n