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Volume 1 - Opinions of Counsel SBEA No. 80

Opinions of Counsel index

“Open lands” (valuation) - General Municipal Law, § 247:

Where a municipality acquires an interest in land for the purpose of preserving open spaces or natural scenic beauty, or to maintain natural or scenic resources, the valuation placed on such open area shall take into account the limitations on the future use of the land.

We have received an inquiry as to whether tax relief is available for “open lands”.

          The Real Property Tax Law provides that all real property is subject to taxation unless specifically exempted by law (section 300) and that all real property must be assessed at its full value (section 306). The courts have held that the requirement to assess at full value is satisfied as long as all property within the jurisdiction is assessed at the same percentage of full value. This means, in the absence of specific statutory provisions, that all property, be it residential, farmland, resort, commercial, agricultural and any other type of property, must be assessed in the same manner.

The courts have held that full value is synonymous with market value (that is, the price a willing purchaser would pay to a willing seller for the property under normal circumstances). Such value may be determined by studying available sales of similar property in the area.

In an area where subdivision and development are taking place rapidly, it becomes difficult to determine full value of vacant or open land. In such cases, the assessor must consider not only available sales, but also such factors as the actual use of the property and the adjoining properties, the extent of development, the length of time it would take to develop the area, the adaptability of a particular parcel for subdivision or development purposes, and the ability of the market to absorb all existing open or vacant land in the area.

Many municipalities in which land is being developed rapidly are desirous of preserving open spaces or natural scenic beauty or to maintain natural or scenic resources. Section 247 of the General Municipal Law authorizes a municipality (that is, a county, city, town or village) after due notice and a public hearing to acquire by gift, purchase, grant, lease or otherwise, a fee or any lesser interest, easement, covenant or other contractual right in open land. Where any such interest is acquired by a municipality, the valuation placed on such open area for purposes of real property taxation shall take into account and be limited by the limitations on future use of the land. The effect of a contractual interest in the property would be that the value of the property would be limited to its value as open land since a developer would not be likely to purchase burdened property that could not be developed until the contractual rights in the land expired.

January 19, 1972

Updated: