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Volume 6 - Opinions of Counsel SBEA No. 90

Opinions of Counsel index

Correction of errors (clerical error - definition) (refunds) - Real Property Tax Law, §§ 550, 554, 556, 940:

Transposition of an amount to be raised from a property tax levy with the amount of an appropriation (i.e., the property tax plus revenue from other sources for a single purpose) in the computation of the total tax liability constitutes a mathematical error in the computation of the tax. The Real Property Tax Law (Art. 5, tit. 3) provides an administrative remedy for such an error.

We have received an inquiry concerning the applicability of the so-called “correction of errors law” (Article 5, title 3, of the Real Property Tax Law) to an error which occurred in the extension of the tax levy of a town by the county in which it is located. The town budget included an appropriation for highway “repairs and improvements” and a highway “improvement program” of $113,000; after the deduction of estimated revenues from other sources, the balance to be raised for highway purposes from the property tax was nearly $81,000. However, in computing the total tax, the appropriation figure was listed as the amount to be raised from the property tax, and it was not until after the levy and extension (January 5,1977) that the error was discovered. This was a “clerical error” as that term is defined in subdivision 2 of section 550 of the Real Property Tax Law, particularly paragraph (d) of that subdivision, to wit, “an entry which is a mathematical error present in the computation or extension of the tax.”

As enacted in 1974 (L.1974, c.177), the correction of errors law was intended to be limited in subject matter to errors which went to jurisdiction, transcription or computation, as opposed to changes attributable to errors in judgment as to valuation. The error in question was clearly not one of the latter kind; the correct amount to be raised from the property tax was not in dispute, it was simply transposed with the appropriation amount, and the result was an entry against each property which was incorrect due to a mistake in the arithmetic of computing the tax.

If the tax has been levied, but the warrant has not yet expired, two remedies exist: one if the property owner has paid the tax, and one if he has not. In the first case, the property owner would submit Form EA: 74-6 [now EA-556] to the county director of real property tax services.who must make a recommendation to the tax levying body, which may then grant or reject the application (Real Property Tax Law, §556).

If, on the other hand, the warrant for collection of taxes has not yet expired and the property owner has not yet paid his taxes, the owner should file Form EA: 74-4 [now EA-554] with the county director, who must again make a recommendation to the tax levying body; the latter body may then authorize or reject the application for correction of the tax roll (id., §554). Application in this case must be made within the interest-free period for payment of taxes, if the property owner is to avoid the payment of penalties and interest on the corrected tax levy (see, id., §554(7)).

Even in the case of a “wholesale” error such as this, the application for correction (once the date for the levy of taxes has passed) must come from each affected property owner. There is no provision which would currently permit a tax levying body unilaterally to refund a portion of the tax levy on each parcel without such application. However, as our experience with this law increases, we have found that these “wholesale errors” occur with some frequency, and there have been a number of requests for legislation to authorize a single application.

We have been asked whether subdivision 3 of section 940 of the Real Property Tax Law would not provide a far simpler, if indirect, remedy. That subdivision authorizes the collecting officer to pay over to the county treasurer any surplus resulting from a levy which “exceeds the amount that should have been raised,” with the city or town to be credited for that amount for the purpose of reducing the tax to be levied therein in the succeeding year.

We are not certain that this statute was intended to apply to the factual situation before us. The Attorney General, however, has concluded (Op.Atty. Gen. 1916, 7 St. Dept. 494) that a predecessor statute (Tax Law, §84), did not apply in a case where a county budget included the same item twice, resulting in a levy some $156,000 more than the amount which should have been raised. His rationale was that the law should not be interpreted to authorize retention of moneys illegally raised and that it was illegal for the county to levy a tax in excess of the amount necessary for local purposes.

March 15, 1977
Revised September 29, 1979

NOTE: Section 556-b, as added by chapter 390, section 7 of the Laws of 1978, now authorizes the filing of one application for correction of certain types of errors (including the one discussed in this opinion) if those errors are “substantial in number and identical in nature.” The section took effect June 19, 1978.

Updated: