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Volume 3 - Opinions of Counsel SBEA No. 10

Opinions of Counsel index

Open space lands (taxable status) - General Municipal Law, § 247:

The direction in General Municipal Law, section 247 to the assessor to consider the effect of a burden imposed on open space lands in arriving at assessed value cannot be construed to encompass authority to exempt a specified percentage of the assessed value from taxation.

We have received an inquiry concerning the implementation of section 247 of the General Municipal Law. The pertinent parts of such section provide:

2. The acquisition of interests or rights in real property for the preservation of open spaces and areas shall constitute a public purpose for which public funds may be expended or advanced, and any county, city, town or village after due notice and a public hearing may acquire, by purchase, gift, grant, bequest, devise, lease or otherwise, the fee or any lesser interest, development right, easement, covenant, or other contractual right necessary to achieve the purposes of this chapter, to land within such municipality.

* * *

3. After acquisition of any such interest pursuant to this act the valuation placed on such an open space or area for purposes of real estate taxation shall take into account and be limited by the limitation on future use of the land.

A town has passed a local law providing that a land owner with 25 acres of land or more who wishes to commit land to open spaces for a period of five years will receive an assessment of 45 percent of its current assessment or, if the period of commitment is eight years, the assessment would be 25 percent of its current assessment.

We are not aware of any statute which gives the town the authority to grant a kind of exemption which results from such a local law and it would appear that the local “scenic easement law” enacted by the town is unauthorized. The authority to grant exemption from taxation is vested in the Legislature, and municipalities, in the absence of legislative authorization, may not grant exemption from taxation.

This town may be attempting to expedite acquisition of open spaces under section 247 of the General Municipal Law by providing specific and measured incentives to property owners. That law authorizes municipalities to acquire a wide range of rights or interests in real property for the preservation of open spaces, and further provides that where easements, developmental rights or the like are transferred by the owner to the municipality, the assessor shall take into consideration the effect of the burden of the incumbrance on the property by virtue of the transference. This direction to consider the effect of a burden imposed on real property in arriving at assessed value cannot be construed to encompass authority to exempt a specified percentage of the assessed value from taxation. Obviously, an agreement transferring developmental rights would be “amortized”, since the burden would dwindle as the remaining period of the agreement waned.

It appears that several municipalities are entering into these open space agreements with individuals, and coupling the agreement with the direction to the assessor to assess at a prescribed percentage of assessment as part of the open space agreement.

Such a direction to the assessor, of course, is illegal and unenforceable since it is the assessor, and the assessor alone, who has the responsibility to assess property at full value or a uniform percentage thereof, and the sole authority to determine the percentage of full value at which he shall assess. This principle was clearly underscored in a recent case in the Town of Ramapo where the town board directed the assessor to assess at a different percentage of full value than the percentage determined by the assessor. The court upheld the assessor’s authority to determine the percentage of full value at which property in the assessing unit would be assessed (McAlevey v. Williams, 41 App.Div.2d 971, 344 N.Y.S.2d 193).

As to the question concerning the utilization of a reduced assessment for taxation purposes, the reduced assessment would be the basis for computing general taxes as well as special ad valorem levies.

With respect to the question as to a mortgagor’s right to restrain a property owner from entering into an easement agreement, this is a matter which would have to be determined from the contractual agreement between the mortgagor and mortgagee. We do not believe this is an area in which an assessor should become involved, since it would have to be decided between the parties having interest in the bundle of rights attaching to the parcel of real property, pursuant to any agreement they may have made. Whether the owner of the property is breaching a contractual agreement by transferring developmental rights to the municipality, is a matter for the mortgagor to determine, and it is up to the mortgagor to pursue his legal rights in enforcing the contract provisions. Unless and until he does so, the transfer of developmental rights to a municipality under section 247 would have to be considered by the assessor within the limits announced under that statute (i.e., the direction that the assessor should take into consideration the effect of the burden on the value of the property).

July 11, 1973

Updated: