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Volume 10 - Opinions of Counsel SBRPS No. 121

Opinions of Counsel index

Public authorities exemption (Onondaga County Water Authority) (liability for special ad valorem levies and special assessments); Taxable status date (Onondaga County Water Authority) (change in scope of exemption) - Public Authorities Law, § 1163; Real Property Tax Law, § 302:

A statutory amendment to increase the scope of the exemption of the Onondaga County Water Authority to include special ad valorem levies and special assessments applies to such charges levied on assessment rolls having taxable status dates on or after the effective date of such amendment.

Our opinion has been requested concerning the liability of the Onondaga County Water Authority (hereinafter OCWA) for special ad valorem levies which were levied in January, 2000. The question is whether section 1163 of the Public Authorities Law, as amended by chapter 494 of the Laws of 1999, exempted OCWA from liability for such levies.

Real Property Tax Law, section 302(1), provides that the taxable status of real property in cities and towns shall be determined annually according to its condition and ownership on the applicable taxable status date. Unless another law provides otherwise, the taxable status date of real property in cities and towns is the first day of March (RPTL, §302(1)).

The determination of whether a property is entitled to a full or partial exemption from taxes and assessments to be levied in the following fiscal year generally is made on the basis of the property’s condition and ownership on the applicable taxable status date (33 Op.State Compt. 118; 3 Op.Counsel SBEA No. 32; 7 Op.Counsel SBEA No. 105). The general rule that property shall be assessed according to its condition and ownership as of the applicable taxable status date serves the purpose of achieving a degree of stability and certainty in the tax structure because the budgetary requirements of local municipalities are predicated on the tax base reflected on the assessment roll (1 Op.Counsel SBEA No. 97).

There are exceptions to the general rule. The United States and New York State, based upon their sovereign immunity, are not liable for taxes for property acquired between taxable status date and lien date, despite the fact that the property was owned on taxable status date by a party who was not entitled to a tax exemption (2 Op.Counsel SBEA No. 33; see, Rochester Housing Authority v. Sibley Corporation, 77 Misc.2d 205, 351 N.Y.S.2d 934 (Sup.Ct., Monroe Co., 1974), aff’d, 47 A.D.2d 708, 367 N.Y.S.2d 969 (4th Dept., 1975)). Certain other property owners are not subject to the general rule because the Legislature by statute has indicated a contrary indication (Id. at 206, 351 N.Y.S.2d at 935 [a municipal housing authority]; People ex rel. The American Bible Society v. Commissioner of Taxes, 142 N.Y. 348, 37 N.E.116 (1894) [a religious corporation {1}]; see, 3 Op.Counsel SBEA No. 32 [property damaged by Hurricane Agnes]).

OCWA is one of the public authorities authorized by the Public Authorities Law. As such, real property owned by OCWA is entitled to the exemption included in OCWA’s enabling legislation (RPTL, §412), that is, section 1163 of the Public Authorities Law (see, 2 Op.Counsel SBEA No. 87).

Public Authorities Law, section 1163, was amended by chapter 494 of the Laws of 1999 to provide that OCWA “shall not be required to pay any fees, taxes, special ad valorem levies or assessments of any kind.” Prior to the enactment of chapter 494, section 1163 simply provided that OCWA “shall be required to pay no taxes” upon its properties; it did not indicate whether the scope of the exemption included assessments, special ad valorem levies or special assessments (L.1951, c.675). {2}

As noted in 10 Op.Counsel SBRPS No.116, the Court of Appeals, in New York Dormitory Authority v. Board of Trustees of Hyde Park Fire and Water District, 86 N.Y.2d 72, 653 N.E.2d 1159, 629 N.Y.S.2d 989 (1995), concluded that the scope of the exemption provided to the Dormitory Authority (i.e., Public Authorities Law, §1685), which was enacted prior to the recodification of the Real Property Tax Law (i.e., L.1958, c.959), included special assessments. {3}  Section 1685 contained the provision that the Dormitory Authority “shall be required to pay no taxes or assessments” upon its property. By using a “generic” interpretation of “assessment” in construing the Legislature’s intent, the Court of Appeals concluded that the scope of the exemption granted to the Dormitory Authority included special assessments (Id. at 78, 629 N.Y.S.2d at 991).

In contrast, prior to its amendment by chapter 494 of the Laws of 1999, Public Authorities Law, section 1163, exempted OCWA’s property only from “taxation.” Chapter 494, therefore, was necessary, in light of the Dormitory Authority decision, to expand the scope of OCWA’s exemption to include special ad valorem levies and special assessments.

The remaining question is when that expansion to the exemption took effect. “Generally, statutes are construed as prospective, unless the language of the statute, either expressly or by necessary implication, requires that it be given a retroactive construction” (McKinney’s Statutes, §51(b); Kelley v. Yannotti, 4 N.Y.2d 603, 152 N.E.2d 69, 176 N.Y.S.2d 637 (1958)). {4}

In this case, there is no indication in the statutory language or in the sponsor’s memorandum for the bill enacted as chapter 494 of the Laws of 1999 that the Legislature intended this legislation to be given retroactive effect to January 1, 1999 or March 1, 1999, the taxable status dates which were applicable to different cities and towns in Onondaga County in 1999. There also is no indication in the statutory language or in the sponsor’s memorandum that the Legislature intended chapter 494 to be an exception to the general rule that the determination of whether a property is entitled to a full or partial exemption from taxes and assessments to be levied in the next fiscal year is made based on the property’s ownership and condition on the applicable taxable status date. Bill section 2 of chapter 494 simply states that this “act shall take effect immediately” as does the sponsor’s memorandum. Chapter 494 of the Laws of 1999, therefore, became effective when the Governor approved the legislation on September 7, 1999.

In light of the above, it is our opinion that OCWA was not exempt from the special ad valorem levies which were levied against its property in January, 2000, since those charges were imposed upon assessments appearing on assessment rolls with taxable status dates preceding the effective date of chapter 494 or the Laws of 1999. OCWA’a broadened exemption will apply to assessment rolls prepared on the bases of taxable status dates occurring on and after the effective date of the chapter which expanded its exemption to include special ad valorem levies and special assessments.

November 20, 2000


{1}  Construing L.1893, c.498: a general recodification of the nonprofit organizations exemption (see, American Bible Society v. Lewisohn, 40 N.Y.2d 78, 351 N.E.2d 697, 386 N.Y.S.2d 49 (1976)). As a general rule, nonprofit organizations must own their property as of taxable status date to receive exemption thereon (Semple School for Girls v. Boyland, 308 N.Y. 382, 126 N.E.2d 294 (1955)).

{2}  The section was originally designated Public Authorities Law, §1138, and was renumbered as Public Authorities Law, §1163, by L.1957, c.914.

{3}  The import of the New York State Dormitory Authority decision is analyzed in 10 Op.Counsel SBRPS No. 16.

{4}  Remedial statutes may constitute an exception to the general rule that statutes are not to be given a retroactive operation (McKinney’s Statutes, §54).

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