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Volume 11 - Opinions of Counsel SBRPS No. 65

Opinions of Counsel index

Special ad valorem levies (sewer charges) (liability of State, county and town property in Westchester County); State of New York exemption (liability for Westchester County sewer district charges); Municipal corporations exemption (liability for Westchester County sewer district charges) - Real Property Tax Law, §§ 102(14), 404, 406, 490; Westchester County Administrative Code, § 237.91:

Otherwise tax exempt town-owned property is liable for all special ad valorem levies charged for purposes of a Westchester County sewer district. Most tax exempt county-owned property is also liable for all such special ad valorem levies, except county-owned property acquired for park or parkway purposes, which is liable only for the capital cost portion of such levies. Tax exempt State-owned property is not liable for any special ad valorem levy imposed for such a sewer district.

We have received an inquiry concerning the municipal corporations exemption (Real Property Tax Law, §406(1)) and the State of New York exemption (RPTL, §404) as they relate to a sanitary sewer district in Westchester County. The district imposes special ad valorem levies, but its capital costs have not been separately identified from its operation and maintenance expenses. The question is whether and to what extent town-, county-, and State-owned properties within the district are liable for the district’s special ad valorem levies. For purposes of this opinion, we assume that the town- and county-owned properties qualify for exemption under section 406 of the RPTL, while the State-owned properties qualify under section 404.

Town-owned properties

RPTL, section 406(1), provides that “[r]eal property owned by a municipal corporation within its corporate limits held for a public use shall be exempt from taxation and exempt from special ad valorem levies and special assessments to the extent provided in section [490 of the RPTL].” Generally, properties whose scope of exemption is governed by section 490 are not liable for most special ad valorem levies and special assessments (see, 7 Op.Counsel SBEA No. 88). However, such properties are liable for certain special ad valorem levies and special assessments including those imposed for the capital costs of “sewer systems (either sanitary or surface drainage or both, including purification, treatment or disposal plants or buildings)” (RPTL, §490).

However, Westchester County Administrative Code, section 237.91, in relevant part states:

Notwithstanding the provisions of any general, special or local law, specifically or otherwise to the contrary, no lots or parcels of land in any county sewer district shall be exempt from the taxes and assessments to be imposed as provided by this title, except such as may belong to the United States or be used as a cemetery, or property acquired by the state or county for park or parkway purposes.

We have construed what is now section 237.91 to mean that property otherwise exempt from special ad valorem levies pursuant to a general statute nevertheless is liable for such levies for a Westchester County sewer district (6 Op.Counsel SBEA No. 37). A court has made a similar statutory interpretation of the County Administrative Code (see, New Rochelle Municipal Housing Authority v. City of New Rochelle, 53 Misc.2d 1059, 280 N.Y.S.2d 604 (Sup.Ct., Westchester Co., 1967)). Therefore, notwithstanding sections 406(1) and 490 of the RPTL, in our opinion, section 237.91 of the County Administrative Code obligates the town to pay all special ad valorem levies that are imposed upon its properties for the county sewer district.

County-owned properties

Since county-owned exempt property is also subject to the provisions of section 406, our opinion as to county property mirrors that for town-owned property, with one exception. That is, as previously noted, section 237.91 does not apply to county-owned properties that were “acquired ... for park or parkway purposes.” Therefore, it is our opinion that the county generally must pay all the special ad valorem levies that are imposed on its properties for the county sewer, except in the case of county-owned properties that were acquired for “park or parkway purposes.” The latter category of county-owned properties are only liable for special ad valorem levies that are imposed for the sewer district’s capital costs, in accordance with section 490 of the RPTL.

In such situation, the county shall enter on the tax roll as the amount to be paid a charge that is solely based on the capital costs of the district (see, RPTL, §900; see also, 3 Op.State Compt. 455 (1947)). We believe this type of entry must be made in order to facilitate the administration of the partial exemption granted to such properties by section 406(1), regardless of the fact that the district’s capital costs and operation and maintenance expenses have not previously been identified. Obviously, the district’s cooperation must be sought so that the correct entry may be made.

State-owned properties

The State Comptroller relies upon a 1953 opinion of the Attorney General (1953 Op.Atty.Gen. 133) for its policy of not paying “any special ad valorem levy on its tax exempt property” (see, 10 Op.Counsel SBRPS No. 92). {1}  As we explained in our opinion, we also defer to the Attorney General’s 1953 opinion. Accordingly, we believe that State-owned properties are not liable for the special ad valorem levies that are imposed for the county sewer district, regardless of whether those charges are used to pay the capital or the operation and maintenance expenses of the district. {2}

Finally, we note that State-owned properties that use the facilities of the county sewer district are liable for the district’s sewer rents (2 Op.Counsel SBEA No. 32). This is also the case for the exempt county- and town-owned properties (see, Y.M.C.A. v. Rochester Pure Waters District, 37 N.Y.2d 371, 334 N.E.2d 586, 372 N.Y.S.2d 663 (1975)).

November 22, 2004


{1}  In the Attorney General’s opinion, special ad valorem levies upon State lands are “illegal and void” (1953 Op.Atty.Gen. 133, 136) because those charges are not covered by the waiver of sovereign immunity set forth in section 19 of the Public Lands Law.

{2}  We note that the court in the New Rochelle decision stated that what is now section 237.91 of the Westchester County Administrative Code obligates most State-owned properties that are located within a Westchester County sewer district to pay all the charges imposed for the district. The only exception to liability stated by the court applies to State properties that are “used for park and parkway purposes” (New Rochelle Municipal Housing Authority v. City of New Rochelle, 53 Misc.2d 1059, 1062, 280 N.Y.S.2d 606, 607 (Sup.Ct., Westchester Co. 1967)). That statement, however, appears to be obiter dictum because the facts in that case did not involve property owned by New York State.

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