CITY HALL — They say politics make strange bedfellows, and on Thursday, a decades-old problem brought together New York City politicians from across the political spectrum.
City Council Minority Leader Joe Borelli (R-South Shore) and City Councilman David Carr (R-Mid-Island) joined City Comptroller Brad Lander and a host of other city Democrats to push for changes to the city’s inequitable property tax system.
“I’m proud to be part of this coalition. I’m excited to see some momentum on an issue,” Borelli said. “Without them, frankly, this would not be advancing downfield at all.”
He referenced a color-coded map that shows places like Staten Island and southeast Queens paying higher effective property tax rates than some of the city’s most affluent areas like Park Slope and the Westside of Manhattan.
For example, a Richmond Valley home valued at about $1.3 million in the city Department of Finance’s 2021 report on the property pays about $2,800 in quarterly property tax, while a Cobble Hill home valued at about $3.4 million pays about $2,400 quarterly.
That inequity is caused by part of the existing property tax system in which new construction or a major change to an existing building triggers a value reassessment.
Additionally, new owners of long-standing properties in parts of the city that have been revitalized over the past 40 years reap the benefits of the outdated tax system.
Carr, who won election last year, said that while he was door knocking during last year’s campaign, one of the most consistent complaints he heard was regarding the city’s antiquated property tax system.
“Property taxes are too high,” Carr said. “It’s just plainly unfair, it has to end, and this is the best and most important way we can provide property tax relief.”
The councilman also referenced a property tax rebate that passed in this year’s city budget that will provide about $150 to most homeowners on top of the existing state rebate.
A property tax rebate hasn’t been in place since 2008 when about 600,000 property owners of one- to three-family homes, co-ops, and condos took advantage of the opportunity.
In March, Borelli, Carr and City Councilwoman Kamillah Hanks (D-North Shore) joined 18 of their colleagues in signing a letter to both Mayor and Speaker Adams seeking such a rebate as part of the budget.
Hanks did not attend Thursday’s press conference, but she said she supports Lander’s effort to have the system reformed.
“We need to establish a fair and transparent propriety tax system, especially for small residential property owners. For too long, the system has benefited wealthy homeowners,” she said. “I applaud Comptroller Lander’s efforts at real property tax reform, and I call on our State Legislature to fix the broken system for all New Yorkers.”
Lander’s coalition, which launched Thursday, also includes — non-profit organizations, like the Legal Aid Society and Al Sharpton’s National Action Network along with politicians such as State Sen. Liz Krueger (D-Manhattan), chair of the Senate Finance Committee; State Sen. Brian Kavanagh (D-Manhattan/Brooklyn), chair of the Senate Housing Committee and a former Staten Islander; City Councilman Justin Brannan (D-Brooklyn), chair of the Council’s Committee on Finance; and City Councilman Kevin Riley (D-the Bronx), whose district has the least equitable property taxes in the city.
“It is going to take a big coalition to do it, because a once-in-a-generation opportunity requires a once-in-a-generation coalition of people,” Lander said. “We must have a fair system and we’re willing to fight for it together.”
If their push is successful, people in Lander’s Park Slope neighborhood, which he represented in the City Council up until last year’s election, will likely wind up paying a higher property tax rate than he currently does.
The group was spurred on by the sunsetting of a long-standing property tax exemption that ended Wednesday. Known as 421-a, the exemption has gone through a series of iterations since the 1970s, and provided an exemption to new some new constructions meant to encourage multi-unit development.
They want the state to take action, and follow the blueprint that a New York City commission released in its final report this past December.
Former Mayor Bill de Blasio and City Council Speaker Corey Johnson convened the New York Property Tax Commission in May 2018 touting it as a way to make a “simpler, clearer and fairer” system, while ensuring no reduction in property tax revenue.
The commission’s primary recommendation is a new tax class for small residential properties — one to three family homes, condominiums, cooperatives, and 4- to 10-unit rental buildings.
Currently, condos and co-ops are taxed at a lower rate than homes despite often being more expensive. Property values in the new residential class would be based on sales-based market value instead of the current system that values co-ops and condos against comparable rental units.
To make that and the rest of their proposals a reality, lawmakers at the state and city level will need to reform a decades-old system, and challenge a variety of special interests in the process.
Lander said they hope to have a full set of recommendations done by the end of the year, and for the state Legislature to make reform a top priority during next year’s session.