Finally tear down this tax system – New York Daily News
Five years ago, Tax Fairness Now in New York (TENNY), a coalition of landlords, tenants, rental property owners, and civil rights and social justice organizations, has filed a lawsuit challenging the city’s property tax system of New York because it unfairly burdens low-income and minority neighborhoods. The group has encountered several obstacles – mostly in the form of aggressive litigation, delaying tactics and a passionate defense of the current system by New York City and the state, even though former Mayor Bill de Blasio has appointed a committee to resolve the very legal issues raised. in the trial.
Thankfully, in late April, the state’s highest court granted TENNY’s motion for leave to appeal, which means New York’s property tax inequities will finally have their day in court.
This is a big deal. Few cases are heard by the Court of Appeal, especially after the intermediate court has dismissed an action. By allowing the review, the committee will have the opportunity to determine whether a system that everyone has long recognized produces arbitrary and inequitable results is not only bad policy, but against the law.
It would be a long time coming. Almost 30 years ago, in 1993, I chaired the New York City Property Tax Reform Commission for then-Mayor David Dinkins. The objective of the “Grayson Commission” was to remedy the inequalities of the system and to propose reforms. We found and then what we know now: the system was unfair, not taxing property in each property class evenly and treating New Yorkers in the same city differently based on where they lived, leading to people with the same land value to pay very different taxes.
The real-world consequences for New Yorkers are dramatic. As TENNY’s complaint explained, the city overvalues homes in majority-minority neighborhoods by nearly $2 billion a year, resulting in residents of those neighborhoods paying nearly $400 million more in taxes. than they would pay if they were taxed at the same rate used. in predominantly white neighborhoods. Additionally, the city taxes rental properties at approximately five to six times the tax rates of high-value condominiums and co-ops, irrationally forcing tenants in working-class and middle-income areas of the city to subsidize wealthier New Yorkers living in multimillion-dollar homes on Fifth Avenue and Central Park West.
Recommendations from our 1993 report included moving to a more uniform system, revising the class system, and providing greater relief to low-income residents. Nearly three decades later, and after spending three years working on it, another city commission released a report also recommending structural changes to the system. If these changes sound like what we were advocating in 1993, that’s because they are.
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The new report called for everything from creating a new tax class for small property owners, to ending the practice of assessing different properties within and between classes at varying value percentages, to replacing the complicated way we allocate taxes with a simple and more transparent system. . But none of these recommendations can be implemented without changing the laws of several states and cities that govern the property tax system. The Legislature did not enact the necessary legislative changes in 1993 and is unlikely to do so now without court advice.
It might be a comic malfunction if the landlords and renters who can least afford it weren’t hurt in the process.
New York City’s property tax system not only violates state law, but fair housing lawperpetuating segregation by making it harder for people to save enough money to leave certain neighborhoods and devaluing homes in those neighborhoods with excessive tax burdens.
Legal action is needed to reform the system.
Now, more than ever, with gasoline prices at record highs and the cost of inflation driving up the prices of everyday essential purchases, and with apartment building rents soaring partly because of rising property taxes, I hope the Court of Appeals will do what it can to ensure that residents of low- and middle-income neighborhoods in New York receive a fair property tax , transparent, predictable, understandable, legal and constitutional.
Thirty years after my commission published its report, it is exciting that change can finally happen. We should know by this fall whether the court decides to send the case back to the lower court or let the Legislature and property tax administrators know once and for all what the law requires. This will be an important decision for justice and fairness in New York. It will reverberate for decades and impact everyone – from landlords to tenants in every borough. Let’s hope the time for the property tax has finally come.
Grayson served as Deputy Mayor for Finance and Economic Development, Commissioner of the New York City Department of Finance, and Commissioner and Chairman of the Financial Services Corp. under the administration of Mayor Koch.