Volume 7 - Opinions of Counsel SBEA No. 58
Special assessing units (tax shares) (number of classes) – Real Property Tax Law, § 1803:
A city or village within Nassau County, which adopts a local law providing that its taxes will be levied upon the County roll, may elect to consolidate real property classes 2, 3 and 4 as a single class for levy purposes. A school district in Nassau County also has the option of reducing the number of classes from four to two for tax purposes.
We have been asked to explain the various options available to school districts, cities and villages within Nassau County as a result of chapter 1057 of the Laws of 1981.
Article 18 of the Real Property Tax Law, as added by chapter 1057, applies only to “special assessing units” which currently include New York City and Nassau County (those being the only assessing units “with a population of one million or more” as required by section 1801(a)). Tax levies on the tax rolls of these assessing units are to be distributed among four classes of real property, as defined in section 1802(1), in shares equal to the proportion of taxable assessed value of each class to the total taxable assessed value on the 1981 assessment roll of the assessing unit or “portions” thereof (§1803(1)).
A municipal corporation, including a school district, by or on behalf of which a tax is levied or imposed upon the assessment roll of a special assessing unit, will have its tax distributed in accordance with these provisions; that is, there will be four classes of real property for tax purposes (and, therefore, four tax rates). However, a school district may, by resolution, determine that taxes will be allocated between two classes only, consolidating classes two, three and four as a single class for purposes of its tax levy. Authority for this is found in subdivision 5 of section 1803 of the Real Property Tax Law.
Cities and villages in Nassau County have several options. The first is to complete a revaluation program in accordance with th rules and regulations of the State Board and thereby become eligible for status as an “approved assessing unit” under Article 19 of the Real Property Tax Law (§§1901(d), 1902). Such status authorizes the governing body of the assessing unit to elect certain assessment (§1904) and tax policy options (§1903) not otherwise available to it. The former include a five-year phase-in of the shift to the reassessment value (or a uniform percentage thereof), while the latter permits election of a “homestead base proportion” which is similar to the class tax share concept of Article 18. The important difference is that under Article 19, the base proportions for the city or village would be drawn from the city or village assessment roll prepared immediately prior to its first revaluation, while the class tax shares under Article 18 are based upon the 1981 assessment roll of each special assessing unit.
A city or village in Nassau County may, however, elect to “be governed by the provisions of article ” by adopting a local law providing that its taxes will be levied upon the County roll (§1803(4)). Such action must be taken no later than 60 days before the last date for the levy of city or village taxes. If such a local law is adopted, the special assessing unit (in this case Nassau County) must deliver that portion of its roll which is applicable to the city or village.
Cities or villages which act to adopt the Nassau County assessment roll have a further option, similar to the option available to school districts within Nassau County. That is, they may elect, by local law, to allocate taxes to classes two, three and four as if those were a single class; as a result, there would be only two tax rates for the village or city, rather than the four which would be otherwise mandated under section 1803.
March 19, 1982