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Written by Joanne Wallenstein

Category: The Goods

Published: 05 March 2014

At a special meeting of the Board of the Town of Scarsdale on Tuesday March 4, the Trustees voted unanimously (7-0) against the adoption of the Homestead Tax Option which would have tripled real estate taxes for owners of 42 condominiums at Christie Place in Scarsdale Village. The option to adopt Homestead was considered in conjunction with the Village-wide tax revaluation currently in process in Scarsdale. Homestead was originally adopted by New York State to permit the balancing of the tax burden between the residential and commercial tax classes following a revaluation. Since Scarsdale is 94% residential, Homestead would have had little impact on the allocation of the tax burden between these two classes. Instead, the option was under consideration in Scarsdale only to reclassify condominiums so that they would be assessed as single-family homes. The Village's inventory of co-ops would continue to be assessed on an income basis, giving them a substantial tax advantage over condominiums.

Trustees spoke eloquently on the issue, explaining the reasoning behind their votes. They cited fairness, the intent of the Homestead law, the inequity between condos and coops, the burden on condo owners and their inability to know that a major tax increase could be imposed. A recap of the meeting will be posted tomorrow.

The adoption of the Homestead Tax Option was supported by the Scarsdale Forum. Bob Berg and Bob Harrison both reiterated their case for the option at the meeting along with Robert Selvaggio and Martin Kaufman. However, The League of Women Voters of Scarsdale did not support the adoption of Homestead and Linda Doucette-Ashman read excerpts from the following statement at the meeting:

Here is the LWVS Consensus Statement on the Homestead Tax Option:

On Thursday, February 27, 2014 the League of Women Voters of Scarsdale (LWVS or the League) held an information meeting, open to the public, regarding the adoption by the Town Board of the Town of Scarsdale (Town Board) of the provisions of Section 1903 of the Real Property Tax Law, commonly referred to as the Homestead Tax Option. During the information meeting, Linda Doucette-Ashman, chair of the LWVS ad hoc committee on the Homestead Tax Option (the Committee), presented a brief overview of the Homestead Tax Option, including the purpose of the Tax Option and the effect of its adoption, and panelists John Wolham, Regional Director of the New York State Office of Real Property Tax Services, New York State Department of Taxation and Finances, and Nanette Albanese, Scarsdale Town/Village Assessor, responded to questions from the Committee and the audience regarding the Homestead Tax Option. A consensus meeting of the members of the League immediately followed.

Background
In municipalities that have not reassessed in many years, the assessment of residential properties is typically lower compared to their full or market value than other types of property such as commercial property. In these situations, residential properties as a class would bear a larger portion of the tax burden after a reassessment. As a result of the concern for tax-burden shifts to residential homeowners, the law in 1981 provided for the Homestead Tax Option.

The Homestead Tax Option requires every property to be classified as either homestead, which includes single-family homes, or non-homestead, which includes commercial property. In addition, condominiums built as condominiums must be included in the homestead class of property. Adoption of the Homestead Tax Option allows the assessing unit to set two different tax rates: a lower tax rate for residential property (homestead) owners and a higher rate for all other property (non-homestead) owners. The tax rate for the homestead owners 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 are used.

The purpose of the Homestead Tax Option is to help communities prevent a shift in the tax burden from commercial properties to residential properties at the time of revaluation. Adoption of the Homestead Tax Option is not mandated; it is a choice for the local governing body of the assessing unit to consider at the time of revaluation, typically to insulate residential property owners, as a group, from bearing a larger share of the tax burden after revaluation.

A town-wide revaluation has been undertaken in Scarsdale with the new tax assessments to be implemented on the June 1, 2014 assessment roll. If the Homestead Tax Option is to be adopted, the Town Board must adopt a local law adopting the Homestead Tax Option sixty days prior to the Town tentative assessment roll filing date, June 1, 2014.

We understand that the Town Board is not looking to adopt the Tax Option for the purpose of preventing a shift in the tax burden from commercial properties to residential properties by establishing two separate tax rates since the shift in tax burden would be negligible.

The Town Board is considering adopting the Homestead Tax Option only to "value and assess certain qualifying condominiums in the same manner as single-family residences," the result of classifying condominiums, built as condominiums, as part of the homestead class.

If the Homestead Tax Option is adopted, the classification of condominiums, built as condominiums, will change the method of valuation for those condominiums from the income approach (the method required by law to be used for all cooperative and condominiums) to the market value approach (the method used for single-family homes, which is essentially based on fair market value or the resale price).

Currently, there is one property that contains units that are condominiums, built as condominiums, in Scarsdale, One Christie Place. Adoption of the Homestead Tax Option requires the inclusion of the residential condominium units at Christie Place in the homestead class of property thereby requiring a change in the method of valuation of those units from the income value method to a fair market value method. Based on preliminary tax reassessment data provided by Mr. Wolham to the Town Board, this change would result in a 116% increase (versus a 35.48% increase if the Tax Option is not adopted) in share of tax levy to the condominium owners as a class. With the adoption of the Tax Option, single-family homeowners as a class would see a .49% decrease in share of tax levy (versus a .23% decrease if the Tax Option is not adopted). The League believes the potential harm this change would create for the One Christie Place residential condominium owners outweighs the potential benefit its implementation may provide at this time.

Recommendation
The League does not support the adoption of the Homestead Tax Option by the Town Board of Trustees.

The LWVS reiterates its long-standing position of advocating for an increased supply of housing that provides residential alternatives for long-term Scarsdalians.

The League appreciates the opportunity to comment on this issue.

We thank Ms. Albanese for her participation in our information meeting and members of the Village Administration, including Village Manager Al Gatta, Village Clerk Donna Conkling and Ms. Albanese, for the help they have provided the Committee in its preparation and study of the Homestead Tax Option.

Respectfully submitted,

Susie Rush Committee on Homestead Tax Option
President Linda Doucette-Ashman, Chair
Tracy Jaffe
Anne Lyons
Debbie Miller
Kitt Rosenthal
Susie Rush

Details

Written by Joanne Wallenstein

Category: The Goods

Published: 12 March 2014

Service was restored on all Metro North lines at 4:45 pm Wednesday after a major explosion at 9:15 am at 116th Street and Park Avenue in Manhattan shut down all Metro North service from Westchester to New York City for seven hours. The explosion took down two buildings that collapsed next to the train tracks. Two people are reported dead and 18 injured following the explosion and fire. One of the buildings included a piano store and the other a church. Some reported the odor of gas before the boom and a gas leak has now been determined to be the cause of the explosion. The sound of the explosion was so loud it reverberated for at least a half a mile.

Marjorie Anders of Metro North forwarded up the following information about the restoration of train service:

Metro-North structural engineers have verified the integrity of the Park Avenue elevated structure. And all four tracks have been restored to service after being cleared of debris, inspected for track and third rail integrity and approved for operations by Metro-North and the New York City Fire Department.

Trains will run at reduced speeds through the collapse zone to protect nearby employees and reduce vibrations as rescue and recovery work continues. This will result in some delays and crowding through the rush hour.

Details

Written by Joanne Wallenstein

Category: The Goods

Published: 27 February 2014

Residents came out in force on Tuesday night, February 25 to the Public Hearing at Village Hall on the adoption of the Homestead Tax Option. As the Village is now undergoing a tax revaluation, it must consider whether or not to adopt the Homestead Tax Option which was originally drafted to allow municipalities to shift the tax burden between commercial and residential properties following a revaluation. However, one provision of the law would allow the Village to change the way condominiums are assessed. Rather than assess them on their potential rental income, they would be assessed at market value, similar to single family homes. This would triple real estate taxes for 42 condo owners at Christie Place.

A Committee of the Scarsdale Forum studied the option and issued a report favoring its adoption, saying it was fair to all homeowners to be assessed on the same basis. The report was approved by the Forum membership which numbers over 400, by a vote of 11-8.

However, the Homestead Act had few fans at the Public Hearing on Tuesday. Residents, a former Mayor, realtors and the daughter of a resident came out to say why they opposed the adoption of the Homestead Act.

Former Mayor Peter Strauss came to the meeting to give some background on the original deal and to state his view on changing the tax status of the condos. He said, "Since I was involved with the establishment of Christie Place the Homestead proposal relates to my service as Mayor. I signed the deal with Ginsburg.... The application of the Homestead Bill would be out of proportion, unfair, and violate the principals agreed on with Ginsburg. ...We imposed rigid restrictions on the buyers of the properties. We brought the benefit of parking and financial income accruing to the Village treasury. It would be grossly unfair to impose a tax increase on those who purchased with one set of principals in exchange for inconsequential tax reductions to the other 5000 taxpayers in Scarsdale.... Fairness and consistency with past actions have been wise guideposts by our governing boards – I hope that the town board's rejection of the Homestead Act will continue that process."

William Sulzer, an attorney who was retained by the Christie Place tax owners, said, "Christie Place has been wonderful addition to the Village of Scarsdale...Ginsburg Development built parking with 220 spaces for village use and recaptured $350,000 per unit for the parking.... The Village received $325,000 per year for the parking spaces plus the revenue from meters. Christie Place residents pay the debt on a $2.7 million note, amounting to $137,000 per year. They pay for the cleaning of the garage."

Sulzer continued, "Homestead is not designed to generate revenue. The reval was done to correct inequities. Christie Place units was not part of the problem the Village sought to correct.... This is not the correct use of the law and it will result in diminished home values for these condo owners and create inequities between Scarsdale condo owners and those in other communities. This would be a short-sighted option for Scarsdale."

Doug Ulene, a former member of the Scarsdale Forum's Assessment Revaluation Committee, said, "I resigned from both the Forum and the Committee when I saw that the members of the Committee were hell-bent on conflating equality with fairness. They're not the same concepts, and one does not necessarily follow from the other. 7-year olds don't have the same bedtimes as 17-year olds. That would treat them in an equal manner, but it wouldn't be fair."

(Below are excerpts from his statement)

"The men and women who purchased residential condo units in Christie Place acted prudently. They were, after all, buying residences in Scarsdale. Who could have imagined that a village such as ours would be so heartless as to triple their property taxes just a few years later? Surely we, as a community, are better than that."

To paraphrase George Orwell, those who favor the adoption of the Homestead Tax Option appear to believe that without it, "All residents will be equal, but some residents will be more equal than others." However, unlike Orwell's fictional Animal Farm, the inequality to which these individuals object was created not by a handful of pigs, but rather by the majority of Scarsdale residents who favored the multipurpose redevelopment of Christie Place.

I believe that the Village got exactly what it bargained for, but today, a handful of vocal residents want you to improve that deal at the expense of 42 fellow residents who bought Christie Place condos in reliance on those units' favorable property tax assessments.

Today, in the name of "equality über alles" and $150 per year for the majority, advocates of the Homestead Tax Option are encouraging you to oppress the minority. Surely we, as a community, are better than that.

The adoption of the Homestead Tax Option violates the Golden Rule as I know it, and I encourage the Village Board to reject the calls of those who would triple property taxes on 42 residents in the name of equality and fairness. Surely we, as a community, are better than that."

Linda Dietz of Brewster Road said, "I am here because I feel it is wrong to adopt this act. Christie Place was marketed as a place for residents who had already raised their kids, to stay in town. The lower taxes were an inducement. Changing that now is not in the spirit in the deal.... I would like to see more units like that in the Village and I feel if we do this no one will ever buy in the Village again. It's a double cross."

Ed Vassalo who lives in Christie Place said, "What effect will this have on the annual taxes we pay and the resale value of our apartments? What will the value be after the taxes have doubled or tripled? How will I sell a 1,000 square foot apartment with a tax bill of $23,000 to people who can't send children to the school?"

Melvin Adler, also of Christie Place, said, "I moved to Christie Place because I didn't want to pay $30-$40,000 a year in taxes. All of us are senior citizens. On my floor there are 7 apartments – 5 occupied by widows. You are changing the rules. How many would live in Scarsdale if they tripled your taxes? I don't even understand why this is even being discussed."

Robert Berg, Chair of the Scarsdale Forum's Committee on Revaluation, was spoke in favor of Homestead. He asked, "Was there an agreement between the Village and the developer to maintain low property taxes?" When the Mayor responded, "No," Berg continued, "So the issue is with how Ginsburg represented the taxes to them ...You relied on what Ginsburg told you. This information was readily available and you should have had your lawyer look into it." He said, "57% of homeowners in Scarsdale have no children in the schools. Are you going to give them a tax break?" To which Mayor Steves replied, "Of course we won't!"

Berg said, "It's a simple issue to decide; fairness to everyone in the Village of Scarsdale. There are more than 5,000 people in the village, all taxed on the market value of their homes – why should Christie Place be assessed below market value?

We did the reval to get to fairness. A $1mm condo is worth the same as a $1 mm house in Quaker Ridge –why should the taxes be one third? The Village Board of Trustees has to pass Homestead before the Board of Education can decide. Why should you disenfranchise the Board of Education?"

Trustee Stern then said to Berg, "What about the co-ops who continue to get a pass on their taxes? Did the Forum consider this? Is that fair?" To which Berg replied, "We can only do what the law allows us to do– the Homestead Act does not permit this." Committee members Ed Morgan and Bob Harrison also spoke in favor of the option.

Laura Miller of 18 Leatherstocking Lane said, "My mother lives at Christie Place. She based her decision on the taxes and could afford to live there because the taxes were low. The increase would be prohibitive....When Ginsburg made that agreement there were no plans for the taxes to be changed....The condos have restrictions – 55 or older, 65 or older; young families are not able to buy these units and that should be reflected in the taxes. This is very surprising – and that should be taken into account."