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Volume 6 - Opinions of Counsel SBEA No. 16

Opinions of Counsel index

Incorporated volunteer fire company exemption (scope) (special assessments and special ad valorem levies) - Real Property Tax Law, §§ 102(14), 102(15), 464, 490:

Real property exempt pursuant to either subdivision 1 or 2 of section 464 of the Real Property Tax Law is liable for special assessments and special ad valorem levied.

Our opinion has been requested regarding the taxable status of property owned by an incorporated volunteer fire company. Specifically, we are asked whether the exemption provided by section 464 of the Real Property Tax Law extends to special ad valorem levies and special assessments.

Section 464 of the Real Property Tax Law provides tax exemptions for incorporated associations of volunteer firemen. The pertinent provisions are as follows:

Incorporated associations of volunteer firemen

1. Except as otherwise provided in subdivision two of this section, real property owned by an incorporated association of present or former volunteer firemen, other than a business corporation, which is (a) actually and exclusively used and occupied by such incorporated association... shall be exempt from taxation, but the total amount of the exemption to any one incorporated association shall not exceed twenty thousand dollars.

2. Notwithstanding the provisions of subdivision one of this section, real property owned by an incorporated volunteer fire company or fire department created for the purpose of furnishing fire protection which is (a) actually and exclusively used and occupied by such fire company or fire department for public purposes . . . shall be exempt from taxation and exempt from special ad valorem levies and special assessments to the extent provided in section four hundred ninety of this chapter....

Thus, the assessor must first determine whether the fire company is within subdivision 1 or 2. Real property owned by a fire company or department (or incorporated association of present or former volunteer firemen), and actually and exclusively used and occupied by it, is exempt from taxation to the extent of $20,000. If the real property is owned by a fire company or department which was created for the purpose of furnishing fire protection and is actually and exclusively used and occupied by it for public purposes, the property is wholly exempt from taxation (24 Op.State Compt. 526).

The provisions of subdivision 2 are not applicable to all incorporated associations of volunteer firemen but only to incorporated volunteer fire companies or fire departments. In determining the applicability of subdivision 2, however, it is not the name of the applicant which is important, but the manner in which it was incorporated (see, 5 Op.Counsel SBEA No. 45).

The question as to the liability of the fire company for special ad valorem levies or special assessments necessitates a close look at the legislative history of sections 464 and 490.

Subdivision 1 of section 464 is derived from the former section 4 (7) of the Tax Law, which after amendment (L.1927, c.475) and renumbering (L.1933, c.470) provided as follows:

§4. Exemption from taxation
The following property shall be exempt from taxation:
***
7. Real property of an incorporated association of present or former volunteer firemen actually and exclusively used and occupied by such corporation to the extent of twenty thousand dollars.

In 1953, section 4 of the Tax Law was again amended (L.1953, c.876) by adding thereto a new paragraph at the end' of the section. This paragraph defined “taxation” as including: “[t]axes levied upon real property for the purposes of the state, counties, cities, towns, villages, and school districts except as provided in subdivision two of this paragraph” (subd. 1). Subdivision 2 referred to fire district charges. Subdivision 3 referred to assessments levied for special or district improvements or services. The paragraph further provided that, “[t]he provisions of subparagraphs two and three of this paragraph shall not apply to real property which is exempt, or may be exempted in whole or in part, from general taxation pursuant to subdivisions five, five-a, five-b, seven ... of the first paragraph of this section.”

Subdivisions five, five-a and five-b referred to in the statute contained the provisions of the veterans exemption (now Real Property Tax Law, §458). The Court of Appeals in construing the scope of the veterans exemption in light of this language stated, in a 1974 case, “It should be abundantly clear, therefore, that because of the exception of special district charges and assessments from the governing definition of taxation found in former section 4, the scope of the veterans’ exemption is thereby specifically limited” (Morris v. Nassau County Board of Assessors, 35 N.Y.2d 624, 628, 324 N.E.2d 310, 364 N.Y.S.2d 820, 822).

Thus, it is equally clear that the scope of the fire company exemption does not include special district charges. Section 4 (7) of the Tax Law was subsequently amended (L.1958, c.177) to designate what had been subdivision 7 to be clause (a) of such subdivision and to add clauses (b) and (c) thereto, relative to the leasing of the company’s property. This amendment was subsequently repealed and reenacted by chapter 733 of the Laws of 1959. The section was in this form on the effective date of the recodification of the Real Property Tax Law (i.e., October 1, 1959), and was numbered section 464.

As part of the recodification (L.1958, c.959), the closing paragraph of section 4 of the Tax Law was recodified as section 490 of the Real Property Tax Law. Section 1602(6) [now 2002(6)] of that law provided, in part, that, “The repeal by this chapter of section four of the tax law . . . [is] intended to effectuate a continuation and restatement, without change in substance or effect, of the provisions of such [law] and no exemption heretofore granted shall be broadened, increased, discontinued, diminished or impaired, or new exemption granted or authorized by reason of such reenactment.”

Thus section 490 provides an exemption from special ad valorem levies and special assessments for real property which is exempt from taxation pursuant to any of several sections of the Real Property Tax Law listed in section 490. (It is to be noted that “special ad valorem levy” and “special assessment,” which are defined in §§102(14) and 102(15), respectively, are excluded from the definition of “taxation”, in section 102(20).) Section 464 was not one of the sections included in the list in section 490. Given the prior law and the recodification’s stated intent, it was properly excluded.

Therefore, it is our opinion that real property partially exempt from taxation pursuant to subdivision 1 of section 464 of the Real Property Tax Law is fully liable for special ad valorem levies and special assessments.

Subdivisions 2 and 3 of section 464 were added by chapter 807 of the Laws of 1965. The former section 464, discussed above, was also denominated subdivision 1 of such section by that act. As indicated above, subdivision 2 purports to exempt property described therein from “special ad valorem levies and special assessments to the extent provided in section 490.” However, when subdivision 2 was added, section 490 was not amended to include section 464, nor has it been so amended to date. As a general rule, omissions in a statute cannot be supplied by construction (McKinney’s Statutes, §363). Additionally, it is axiomatic that exemption statutes must be strictly construed (Herkimer Co. v. Village of Herkimer, 251 App. Div. 126,295 N.Y.S.2d 629, aff’d, 279 N.Y. 560, 18 N.E.2d 854). Given these two rules of construction, it is our opinion that real property exempt pursuant to subdivision 2 of section 464 is also liable for special ad valorem levies and special assessments (see, 22 Op.State Compt. 359).

Accordingly, regardless of whether property is partially exempt from taxation pursuant to subdivision 1 of section 464, or wholly exempt from taxation pursuant to subdivision 2 of the section, it is fully liable for special ad valorem levies and special assessments.

October 28, 1976
Revised March 1, 1978

Updated: