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Department of Taxation and Finance

Assessor's Manual, Volume 4, ExemptionAdministration

Exemption Administration Manual - Part 2
Industrial, Commercial, and Public Service

Section 4.06 - Chapter 470 of the Laws of 2014

Southampton Hospitality Business Investment Property

Exemption Code(s):      4762_

Year Originally Enacted:   2014

Related Statutes:    RPTL §485-b

SUMMARY: To the extent allowed by local option, real property used primarily for hospitality business activity that is located in a town having a population between 56,700 and 56,800, according to the latest federal census, that is constructed, altered, installed or improved after January, 2015 (or some later date set by the taxing jurisdiction) at a cost exceeding $100,000 (or some higher minimum chosen by the taxing unit) is partially exempt from taxation and special ad valorem levies, but is liable for special assessments. However, such property is liable for special ad valorem levies established for fire district, fire protection district, and fire alarm district purposes. The exemption may be granted only after the construction or improvement project has been completed.

State law allows the exemption to be granted to facilities used primarily for the commercial furnishing of accommodations to transient overnight guests.

Application for the exemption must be filed within one year of the date of completion of the construction or improvement project.

  1. ELIGIBILITY REQUIREMENTS:
    1. Ownership Requirements: Facility must be owned or operated by a private individual or organization.
       
    2. Property Location Requirements:  Property must be located a town having a population between 56,700 and 56,800 according to the latest federal census. Based upon the latest federal census, i.e., 2010, only the Town of Southampton in Suffolk County satisfies this criterion
    3. Property Use Requirements: As prescribed by state law, property must be used primarily for hospitality business activity. Hospitality business is the commercial furnishing of accommodations to transient overnight guests. Transient guests are those whose stay on such property is daily or weekly, not to exceed thirty one days in any calendar year.  The cost of the construction or improvement project must exceed $100,000 or any higher amount set by the local taxing unit. (See also Local Option below.) For purposes of this exemption the terms construction, alteration, installation and improvement all exclude ordinary maintenance and repairs
       
    4. Certification by State or Local Government: Completion of the construction or improvement project must be demonstrated by a certificate of occupancy or other appropriate document. 
       
    5. Required Construction Start Date or Other Time Requirement:  Construction or improvement must begin after January 1, 2015, or any later date chosen by the taxing jurisdiction. 
       
  2. LOCAL OPTION: Yes - Each county, town, and school district has several options under the law.
     
    1. Extent of Exemption: The exemption is available to county, town, school district, and special district (except for fire district, fire protection district, and fire alarm district purposes) taxing jurisdictions, which may reduce the percentage of exemption authorized by state law. The option to disallow or reduce the exemption must be exercised by counties, and towns through enactment of a local law and by school districts through adoption of a resolution.
    2. Construction Start Date: With respect to the basic exemption, the taxing jurisdiction may specify in its local law or resolution any date after January 1, 2015 as the date after which construction must have begun for the property to be eligible for exemption.
       
    3. Construction Cost: For the basic exemption, the taxing jurisdiction may, in its local law or resolution, increase the required minimum cost of construction from any amount in excess of $100,000 to any greater amount.
       
  3. LIMITATION ON EXEMPTION:
      General
    Municipal
    Taxes
    School
    District
    Taxes
    Special
    Ad Valorem
    Tax
    Special
    Assessments
    1. Amount Yes* Yes* Yes* No
    exemption
    allowed
    2. Duration 10 years** 10 years** 10 years** No
    exemption
    allowed
    3. Taxing Jurisdiction
    a. County or County
    Special Districts
    Ex NA Ex** Tax
    b. City Tax NA NA Tax
    c. Town or Town
    Special District
    Ex NA Ex** Tax
    d. Village Tax NA Tax Tax
    e. School District NA Ex NA NA
      Ex-Exempt      Tax-Taxable       NA-Not Applicable

    * Basic Exemption - Amount of exemption is limited, in the first year, to 50% of increase in assessed value attributable to the construction or improvement; in each succeeding year, the amount of exemption is decreased by 5%. Local option may reduce the annual percentage of exemption allowed by state law.

    ** Exemptions are liable for special ad valorem levies established for fire district, fire protection district, and fire alarm district purposes

  4. PAYMENTS IN LIEU OF TAXES: None required.
     
  5. CALCULATION OF EXEMPTION:
    1. General Municipal and School District Taxes: The schedule to be followed in calculating the exemption depends on which of the two types of exemption available the taxing jurisdiction has chosen to grant: the basic exemption or the accelerated strategic exemption.
       

       Unless reduced by local law or resolution, the following percentages of the increase in assessed value resulting from the construction or improvement should be applied:

       

      Year of Exemption Percentage of Exemption
      1
      2
      3
      4
      5
      6
      7
      8
      9
      10
      50
      45
      40
      35
      30
      25
      20
      15
      10
      5


       


     
    2. Special Ad Valorem Levies and Special Assessments:

    Special Ad Valorem Levies: See General Municipal and School District Taxes above. However, initial exemptions granted  are liable for special ad valorem levies established for fire district, fire protection district, and fire alarm district purposes.

    Special Assessments: No exemption allowed.
     
  6. CODING OF EXEMPTION ON ASSESSMENT ROLL:

      

     Code                    Description of Alternative Codes Possible

     4762                         Southampton Hospitality Business


    Assessment Roll Section(s): Taxable (RPS Section 1).

    NOTE: These codes should not be used to identify property that is exempt under any of the statutes listed under Similar Exemptions below. For coding of such property, see the Exemption Profile for the statute that applies.

  7. FILING REQUIREMENTS (Owner or Occupant of Property):
    Form RP-4736 Application for Real Property Tax Exemption for Southampton Hospitality Business Investment Property
    Application required first year only. Application must be filed within one year of the date of completion of the construction or improvement project.
     
  8. REPORTING REQUIREMENTS (Assessor): None
  9. SIMILAR EXEMPTIONS:
    Subject Statute
     
    Business Investment Property Outside of New York City RPTL §485-b
    Branch Banks In Banking development Districts RPTL §485-f
    Commercial Properties In Designated Areas of Manhattan RPTL §499-b

Exemption Application Forms: Available at property tax forms website.

 

 

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