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Volume 5 - Opinions of Counsel SBEA No. 55

Opinions of Counsel index

Industrial development agencies exemption (property acquired after taxable status date) - General Municipal Law, § 874; Real Property Tax Law, §§ 302, 412-a:

Real property acquired by an industrial development agency after taxable status date is liable for taxes levied on the assessment roll reflecting such taxable status date.

We have received an inquiry as to the taxable status of real property which has been conveyed to a local industrial development agency.

Section 874 of the General Municipal Law in conjunction with section 412-a of the Real Property Tax Law provides for exemption from real property taxation for industrial development agencies. We have previously indicated that such exemption applies only to general taxes and not to special assessments and special ad valorem levies (1 Op.Counsel SBEA No. 23).

The question presented herein, however, is as to the taxable status of property purchased by an industrial development agency after taxable status date. Various opinions of counsel of the Department of Audit and Control and the State Board of Equalization and Assessment have held that while property acquired by the State or Federal government after taxable status date and prior to lien date is immune from taxation (see, 2 Op. Counsel SBEA No. 33; 1 Op. Counsel SBEA No. 40, respectively), property acquired by quasi-governmental agencies, such as urban renewal agencies (1 Op.Counsel SBEA No. 68) and economic development agencies (2 Op.Counsel SBEA No. 28), after taxable status date in the taxing jurisdiction are subject to taxation for the entire tax year following such taxable status date.

Taken together, these opinions stand for the proposition that the various entities which are classified as quasi-governmental in nature are subject to taxation on real property acquired after taxable status date in a given tax year. We have stated, “Where taxable real property is transferred to a tax exempt organization between taxable status date and lien date, taxes subsequently levied on that property remain due in all cases except where the property was transferred to the State [or Federal government] in which case the tax is void” (2 Op.Counsel SBEA No. 33). Since an industrial development agency is not a state agency or department in the usual sense, it is our opinion that real property acquired by an industrial development agency after taxable status date is liable for taxes levied on the assessment roll reflecting such taxable status date.

January 22, 1976

Updated: