Home » 2011 Issues » March 09, 2011 » TAF-02-11-00011-E Assistance Program to Encourage Local Governments to Reassess on a Cyclical Basis
TAF-02-11-00011-E Assistance Program to Encourage Local Governments to Reassess on a Cyclical Basis
3/9/11 N.Y. St. Reg. TAF-02-11-00011-E
NEW YORK STATE REGISTER
VOLUME XXXIII, ISSUE 10
March 09, 2011
RULE MAKING ACTIVITIES
DEPARTMENT OF TAXATION AND FINANCE
EMERGENCY RULE MAKING
I.D No. TAF-02-11-00011-E
Filing No. 181
Filing Date. Feb. 16, 2011
Effective Date. Feb. 16, 2011
Assistance Program to Encourage Local Governments to Reassess on a Cyclical Basis
PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following action:
Action taken:
Addition of Subpart 201-3 to Title 9 NYCRR.
Statutory authority:
Real Property Tax Law, sections 201(1), 202(1)(k) and 1573(1)(a); and L. 2010, ch 56, parts W and Y
Finding of necessity for emergency rule:
Preservation of general welfare.
Specific reasons underlying the finding of necessity:
The amendments to Real Property Tax Law section 1573 enacted by Chapter 56 took effect immediately and apply to the 2010 assessment rolls for municipalities with a taxable status date on or after March 1, 2010. These rolls are final and the assistance payments for the 2010 rolls must be made before the end of the current fiscal year. An emergency rule was needed to implement the program and insure that the payments could be made. An emergency rule was adopted on October 6, 2010 and readopted and proposed as a permanent rule on December 28, 2010. A second readoption of the emergency rule is needed in connection with the continued administration of the program until the rule can be adopted as a permanent rule.
Subject:
Assistance Program to encourage local governments to reassess on a cyclical basis.
Purpose:
To provide rules to implement the statutary authorized assistance to local governments to encourage a cycle of reassessments.
Text of emergency rule:
Section 1. A new subpart 201-3 is added to such regulations to read as follows:
Subpart 201-3 ASSESSMENT ROLLS WITH TAXABLE STATUS DATES OCCURRING ON OR AFTER MARCH 1, 2010
Section 201-3.1 Applicability. The provisions of this Subpart shall pertain to applicants for state assistance for purposes of assessment rolls with taxable status dates occurring on or after March 1, 2010, pursuant to section 1573(1) and (2) of the Real Property Tax Law, as amended by Chapter 56 of the Laws of 2010, Part Y.
Section 201-3.2 Plan to be filed for state assistance.
(a) A written plan containing the reappraisal schedule and the reinspection schedule for the applicant must be received no later than 120 days prior to the filing date of the tentative assessment roll implementing the first reappraisal in that plan. The plan must be signed by the chief executive officer of the assessing unit and the assessor. For plans involving a coordinated assessment program, the assessor may file a single plan providing that it contains the signatures of the chief executive officer of each member municipality.
(b) In accordance with an approved plan, state assistance shall be payable in an amount not to exceed five dollars per parcel for an assessment roll upon which a reassessment is implemented, and not to exceed two dollars per parcel for an assessment roll upon which a reassessment is not implemented. The amount payable on a per parcel basis shall exclude parcels which are wholly exempt or assessed by the state.
Section 201-3.3 State standards for quality assessment administration.
The standards for quality assessment administration are:
(a) In reassessment years.
(1) The reassessment must:
(i) be conducted pursuant to a plan for cyclical reassessment of not less than four years,
(ii) provide for the reappraisal of all parcels in the first and last year of the plan,
(iii) provide for a reappraisal of all parcels at least once every four years; and
(iv) collect inventory data at least once every six years.
(2) Reappraisal means developing and reviewing a new determination of market value for each parcel, based upon current data, by the appropriate use of one or more of the three accepted approaches to value (cost, market, or income).
(3) Review of the appraisal values consists of a visit to each property, and includes a review of the recorded inventory, examination and analysis of the appraisal estimates, and determination and documentation of a final appraised value. An office review may be substituted if appraisers have collected data or reinspected the property characteristics data as part of the reappraisal, or if the review utilizes oblique aerial, orthophoto, or street-level photography that was taken within three years of the reappraisal. In special assessing units an office review may be substituted if the property characteristics data has been systematically collected from other governmental sources.
(b) Annually. The assessor or the chairman of the board of assessors has filed a signed statement verifying that the following actions were taken in accordance with the statute or rule:
(1) Parcels on the data file have complete and accurate inventories as of taxable status date,
(2) Pertinent sales data on the data file is complete and accurate,
(3) Parcels on the assessment roll filed pursuant to Article 15-C of the Real Property Tax Law have valid property tax exemption codes,
(4) The final assessment roll meets the requirements of Part 190 of this Title,
(5) The assessor's report meets the requirements of Part 193 of this Title and is reconciled by the Office of Real Property Tax Services,
(6) Data files required pursuant to Article 15-C of the Real Property Tax Law and Part 190 of this Title are filed in accordance with Section 1590 of the Real Property Tax Law,
(7) Sales corrections required by Part 191 of this Title are received in an Office of Real Property Tax Services approved computerized format. Transactions are received on a timely basis,
(8) Notice of assessment inventory was published as required by section 501 of the Real Property Tax Law,
(9) Notice of tentative assessment roll was published as required by section 506 of the Real Property Tax Law,
(10) Assessment change notices were sent as required by section 510 of the Real Property Tax Law,
(11) Assessment disclosure notices as required by section 511 of the Real Property Tax Law are sent and required meetings have been held,
(12) The tentative assessment roll was posted on the Internet as required by section 1590 of the Real Property Tax Law,
(13) Notice of final assessment roll was published as required by section 516 of the Real Property Tax Law,
(14) Renewal forms for the senior citizens' exemptions were sent as required by section 467 of the Real Property Tax Law,
(15) Notices of denial for the STAR exemptions were sent as required by section 425 of the Real Property Tax Law,
(16) The uniform percentage appears on the tentative assessment roll or in instances where a tentative assessment roll is not printed, a sign that contains the uniform percentage is posted in a conspicuous location,
(17) In a reassessment year, all parcels were reappraised and reviewed in accordance with the Assessing Unit's plan, and
(18) The Assessing Unit has a method to collect or reinspect all parcels at least once every six years in accordance with section 201-3.3(a) of this Subchapter.
Section 201-3.4 Application for state assistance.
(a) A written application for state assistance must be filed with the Office of Real Property Tax Services annually. Applications must be filed no later than 90 days after the filing of the final assessment roll for which state assistance is applied.
(b) A written application for state assistance must be signed by the chief executive officer of the assessing unit and the assessor. For purposes of this section assessor means the assessor or the chairman of the board of assessors or the county director where the county is assessing on behalf of a city or town assessing unit or the assessor of a consolidated assessing unit or coordinated assessment program or the Chairman of the Board of Directors of a consolidated assessing unit.
(c) For applications involving a coordinated assessment program, the assessor may file a single application, providing that it contains the signatures of the Chief Executive Officer of each member municipality.
Section 201-3.5 Review of Application.
(a) The Office of Real Property Tax Services shall adopt procedures that contain acceptable performance indicators of substantial compliance with standards contained in section 201-3.2 of this Subpart, including ranges of acceptable performance determined in accordance with nationally recognized standards. Office of Real Property Tax Services staff will review applications in accordance with such procedures.
(b) The determination made pursuant to the procedures for the applicable full value measurement as provided in 9 NYCRR 186-2.15 shall be conclusive as to whether a reassessment occurred and a uniform percentage of value was attained.
(c) An applicant must provide assessment roll, inventory, sales files and the corresponding libraries in an Office of Real Property Tax Services approved computerized format. The files must be supplied with the data files submitted pursuant to Article 15-C of the Real Property Tax Law.
(d) In determining compliance, facts and conditions are assumed as of the final roll date for the assessment roll for which state assistance is requested, unless otherwise stated.
(e) Upon approval, Office of Real Property Tax Services staff shall certify the amount of state assistance payable pursuant to this Part.
(f) For computing the amount of state assistance payable pursuant to this Part, the number of parcels are obtained from the data files submitted pursuant to Article 15-C of the Real Property Tax Law.
(g) Upon disapproval, Office of Real Property Tax Services staff will notify the applicant of the disapproval and the reason for the disapproval. The assessing unit shall have 30 days from the date of the mailing of the notification to appeal this denial to the Deputy Commissioner.
(h) Applications for state assistance made pursuant to section 1573 of the Real Property Tax Law are subject to audit. A state-wide verification process with detailed audits of randomly selected individual assessing units will be conducted annually before payments are certified.
(i) Where an applicant receives payment as a result of a false or erroneous statement on the application, or any other act of omission or commission on the part of the applicant, such that the recipient would otherwise have been considered ineligible to receive such payment, the recipient shall be required to refund the improper payment to the state.
Section 201-3.6. Transition provisions for 2010 assessment rolls.
(a) For purposes of assessment rolls completed in 2010, the applicant will be deemed to meet the reappraisal requirement of section 201-3.2 of this Subpart if a reassessment was implemented pursuant to a six-year plan filed in compliance with Subpart 201-2 of this Part.
(b) Notwithstanding the provisions of section 201-3.2(a) and 201-3.4(a) of this Subpart, for purposes of assessment rolls completed in 2010, a plan and an application may be filed no later than 60 days after the effective date of these rules.
(c) For applications involving a coordinated assessment program, a participant municipality shall be eligible for state assistance if it meets the state standards for quality assessment administration as outlined in 201-2.2 of this subpart, notwithstanding the failure of another participant municipality to qualify.
This notice is intended
to serve only as a notice of emergency adoption. This agency intends to adopt the provisions of this emergency rule as a permanent rule, having previously submitted to the Department of State a notice of proposed rule making, I.D. No. TAF-02-11-00011-EP, Issue of January 12, 2011. The emergency rule will expire April 16, 2011.
Text of rule and any required statements and analyses may be obtained from:
John W. Bartlett, Tax Regulations Specialist 4, Department of Taxation and Finance, Taxpayer Guidance Division, Building 9, W. A. Harriman Campus, Albany, NY 12227, (518) 457-2254, email: tax_regulations@tax.state.ny.us
Regulatory Impact Statement
1. Statutory Authority: Real Property Tax Law, sections 201(1), 202(1)(k), and 1573(1)(a). Section 201(1) of Real Property Tax Law, assumption of responsibilities by the Department of Taxation and Finance, provides that certain functions, powers and duties of the State Board of Real Property Services are considered functions, powers and duties of the Commissioner of Taxation and Finance. Section 202(1)(k) of the Real Property Tax Law authorizes the Commissioner of Taxation and Finance in relation to real property tax administration to adopt such rules not inconsistent with law, as may be necessary for the exercise of his or her powers and the performance of his or her duties. Section 1573 of the Real Property Tax Law provides that the assessing units must satisfy standards of quality assessment administration to qualify for assistance, as established pursuant to regulations promulgated by the commissioner. Part W of Chapter 56 of the Laws of 2010 added section 201(1) and amended section 202(1) and Part Y of Chapter 56 of the Laws of 2010 amended section 1573.
2. Legislative Objectives: The rule is being proposed pursuant to such authority to administer statutory amendments made by Part Y of Chapter 56 of the Laws of 2010 to restructure the State's reassessment assistance program to better encourage local governments to maintain updated property assessments on a regular cycle within available funding levels.
3. Needs and Benefits: Under the previous reassessment assistance program, a local assessing unit could receive assistance for conducting a full value reassessment without making any commitment to reassess again. Assessment equity can quickly deteriorate if not actively maintained. Recent amendments to section 1573 of the Real Property Tax Law have changed the reassessment assistance program so that to receive assistance, an assessing unit would have to adopt a multi-year plan of at least four years that calls for a full value reassessment to be completed in the first and last years of the plan, thereby establishing a reassessment cycle of the local government's own choosing. The amount payable on a per parcel basis shall exclude parcels which are wholly exempt or assessed by the state. If an assessing unit withdraws from an approved plan, it will only be responsible for remission of per parcel payments for non-revaluation years.
Anticipated benefits include a reduced effort to maintain equity if reassessments are conducted on a cyclical basis rather than having a long gap ensue, improved clarity for taxpayers if their assessment closely mirrors the actual value of their property, and less drastic shifts in assessed values if reassessments are conducted once every four years rather than at longer intervals. The public can better understand and withstand small changes in value every few years rather than annual changes or huge changes that would likely occur if assessed values are left unchanged for long intervals.
The purpose of these amendments is to make necessary regulatory changes related to the implementation of these provisions and to assure that the funds for the assistance program are effectively managed. This rule provides: plan requirements, the state standards for quality assessment administration that must be satisfied by the assessing unit to qualify for state assistance, requirements for applications for state assistance, and transitional rules for 2010 assessment rolls.
4. Costs:
(a) Costs to regulated persons: None - there are no regulated persons; the regulated parties are the local governments.
(b) Costs to the State and its local governments including this agency: Section 1573 of the Real Property Tax Law was amended by Chapter 56 of the Laws of 2010 to provide a new assistance program to local governments to encourage reassessments. Participation in the assistance program is purely voluntary; no local government is required to conduct a reassessment or to apply for the assistance.
Chapter 55 of the Laws of 2010 contained an appropriation of $6,900,000. This level of funding reflects a $1,350,000 reduction from the 2009-10 budget. The effect will be limited in 2010 as there are provisions in the rules to provide assistance for revaluations conducted in 2010 according to the provisions of the previous program. In future years some local governments which had received assistance of $5 per parcel for annual reassessments will only receive assistance of $2 per parcel for the years between reassessments.
(c) Information and methodology: The appropriation figures were determined by the Division of Budget and Chapter 55 of the Laws of 2010.
5. Local Government Mandates: None. Participation in this assistance program is purely voluntary; no local government is required to conduct a reassessment or to apply for the assistance.
6. Paperwork: If the local government elects to participate in this assistance program, a written plan and application are prescribed by the rule along with statutorily required documentation.
7. Duplication: There are no conflicting state or federal requirements.
8. Alternatives: There were no significant alternatives to consider. The special transitional provisions of the rule were needed to implement this new program because this law became effective after most municipalities filed their tentative assessment rolls and would have otherwise failed to qualify for the program.
This newly established program of Aid for Cyclical Reassessments replaces both the Annual and Triennial Aid programs. Outreach was conducted with the Real Property Tax Administration Committee (RPTAC) and their feedback was considered. In addition to ORPTS executive staff, RPTAC is comprised of Assessors and County Directors of Real Property Tax Services who represent a cross section of large and small assessing units from both the upstate and downstate areas. Most of the comments that were received were technical questions about how the program would work. More comments may be forthcoming as the program is implemented and as local governments prepare their annual assessment rolls. As such, it is too soon to fully evaluate the effectiveness of the program.
9. Federal Standards: There are no federal regulations concerning this subject.
10. Compliance Schedule: The compliance schedule for a local government that elects to participate in the assistance program is specifically set forth in the rule. A written plan must be received no later than 120 days prior to the filing date of the tentative assessment roll implementing the first reappraisal in that plan.
Regulatory Flexibility Analysis
A Regulatory Flexibility Analysis for Small Business and Local Governments is not being submitted with the rule because the rule will not impose any adverse economic impact or any reporting, recordkeeping, or other compliance requirements on small business or local governments. Section 1573 of the Real Property Tax Law was amended by Chapter 56 of the Laws of 2010 to provide a new assistance program to local governments to encourage reassessments. Participation in the assistance program is purely voluntary; no local government is required to conduct a reassessment or to apply for the assistance. The rules are the administrative structure to implement the statutorily authorized assistance program.
Rural Area Flexibility Analysis
A Rural Area Flexibility Analysis is not being submitted with this rule because it will not impose any adverse impact on rural areas or any reporting, recordkeeping, or other compliance requirements on public or private entities in rural areas. Section 1573 of the Real Property Tax Law was amended by Chapter 56 of the Laws of 2010 to provide a new assistance program to local governments to encourage reassessments. Participation in the assistance program is purely voluntary; no local government is required to conduct a reassessment or to apply for the assistance. The rules are the administrative structure to implement the statutorily authorized assistance program.
Job Impact Statement
A Job Impact Statement is not being submitted with this rule because it is evident from the subject matter of the rule that it would have no impact on jobs and employment opportunities. Section 1573 of the Real Property Tax Law was amended by Chapter 56 of the Laws of 2010 to provide a new assistance program to local governments to encourage reassessments. Participation in the assistance program is purely voluntary; no local government is required to conduct a reassessment or to apply for the assistance. The rules are the administrative structure to implement the statutorily authorized assistance program.
Assessment of Public Comment
Section 1573 of the Real Property Tax Law was amended by Chapter 56 of the Laws of 2010 to provide a new assistance program to local governments to encourage reassessments. Participation in the assistance program is purely voluntary; no local government is required to conduct a reassessment or to apply for the assistance. The rule is the administrative structure to implement the statutorily authorized assistance program.
Written comments were received regarding proposal TAF-02-11-00011-EP from Jim Tyger, the Assessor for the Town of Washington in Dutchess County, on behalf of the Dutchess County Assessor's Association. The association consists of assessors from the municipalities within the County.
Additional comments were received from Brad Brennan, CRA, SCAA, assessor for the towns of Salina and Cicero in Onondaga County.
Mr. Tyger submitted three main comments and four suggestions for changes.
Comments:
1. The work needs to be done on an annual basis so that we can incrementally improve the assessment with a level workload.
2. Managing a budget where the budget changes from two to five dollars per parcel does not make sense.
3. The process implemented by the assessors in the annual program seems to make much more sense.
Suggestions:
1. Annualize the aid so that it is consistent each year (example: 5, 4, 3 dollars/parcel each year).
2. Allow physical inventory to be performed over the current 6-year plan (sales, new construction and outliers annually).
3. Continue to allow the use of RPS or similar product as the tool for appraising properties.
4. Allow appraisals to be done over the entire cycle – 5years – maybe 6 years.
All three comments and all but the third suggestion are directed at amendments to section 1573 of the Real Property Tax Law and not the rule. Section 1573(1)(c) establishes the intervals for revaluation and establishes a 6-year interval for inventory collection which already matches the second suggestion. Section 1573(2)(a) outlines the amount of assistance payable that is dependent on whether a revaluation is implemented in a specific year. The suggestion for a fixed annual dollar amount is therefore in conflict with statute. Section 1573(1)(c) conditions the assistance upon a determination by the Commissioner that, among other things, "the revaluation was implemented pursuant to a plan, approved pursuant to the rules of the commissioner, of not less than four years that provides, at a minimum, for a revaluation in the first and last year of such plan, but in no case less than once every four years, and for inventory data to be collected at least once every six years."
Section 1573(2)(a) provides:
"State assistance pursuant to subdivision one of this section shall be payable in an amount not to exceed five dollars per parcel for an assessment roll upon which a revaluation is implemented in accordance with an approved plan, and not to exceed two dollars per parcel for any assessment roll upon which a revaluation is not implemented in accordance with an approved plan. The amount payable on a per parcel basis shall exclude parcels which are wholly exempt or assessed by the commissioner."
The third suggestion, to continue to allow the use of RPS (Real Property System) or similar product as the tool for appraising properties is consistent with the rule in any year in which a revaluation is not implemented.
The last suggestion, to allow appraisals to be done over the entire cycle of 5 or 6 years, is in conflict with section 1573(1)(c), which specifies plan length and intervals for revaluation. The rule simply follows the same timelines outlined in statute.
Mr. Brennan's comments recognize that the law and not the rule introduces changes to the state assistance program. Mr Brennan states:
Salina has conducted yearly reassessment since 2001. Cicero is completing a reassessment project for the 2011 roll. The changes to Chapter 56 will impose an insurmountable personnel and financial burden on most towns in New York State. My two towns will not be able to participate in the new program, which will have a negative impact on my equity.
"The previous 6 year reassessment cycle has accomplished much in equity and the attainment of full value assessments. The proposed changes will end both for many town[s]."
Section 1573 of the Real Property Tax Law was amended by Chapter 56 of the Laws of 2010 to provide a new assistance program to local governments to encourage reassessments. Participation in the assistance program is purely voluntary; no local government is required to conduct a reassessment or to apply for the assistance. The towns for which Mr. Brennan is an assessor can still maintain equity in the assessment rolls without having to meet the statutory requirements for state assistance.
