Published in the Staten Island Advance
By Anna Sanders
CITY HALL — Staten Island officials are threatening to go to court over apparent property tax inequalities.
But first Councilman Joseph Borelli and Minority Leader Steven Matteo are asking the NYC Independent Budget Office (IBO) to help them determine if neighborhoods on Staten Island are really being treated unfairly by the city’s property tax formula.
“As we are often reminded, we serve the public at a time when the administration is seemingly focused on income inequality,” they wrote in a letter to IBO director Ronnie Lowenstein Thursday. “Thus, we are asking for your help in determining if there is also a ‘property tax inequality.'”
A 1975 decision by the state’s highest court forced Albany lawmakers into addressing past inequitable assessment of properties in New York City and across the state.
At the time, owners of commercial and apartment buildings were paying taxes based on a larger share of market value than homeowners. Owners in similar homes of different neighborhoods also had different property tax burdens. The city dealt with this disparity by creating a system based on four classes of property, making each taxed at a different share of market value and setting certain caps.
Twenty-five years after the change, the IBO determined that homeowners in low-income communities no longer had higher tax burdens than those in similar houses in wealthier neighborhoods.
Borelli (R-South Shore) and Matteo (R-Mid-Island) want the agency to again study the relationship of geography and the “various components of the city’s convoluted and almost unexplainable property tax formula.” They would also like to know what triggers a reset of that formula.
“As our predecessors did decades ago, we believe there may be a need for legislative change at the state and local level, as well as a potential cure through the courts,” they wrote.
IBO spokesman Doug Turetsky said the agency would take a look at specific issues raised and figure out how to best provide the information exploring concerns about inequities in the property tax system.
“IBO has a long history of examining and reporting on geographic disparities and other problems with the city’s property tax system — including as recently as last Friday at a state Assembly hearing,” Turetsky said. IBO deputy director George Sweeting had testified that the system allows wide disparities depending on property location.
Borelli and Matteo pointed to a list of properties in Brooklyn and Staten Island to highlight the problem. Island homeowners and those in Park Slope, Brooklyn, are levied at the same 19.56 percent of their assessed value. But Staten Islanders in the sample were billed higher, at 1.31 percent of their market values compared to .33 percent in Brooklyn.
Properties with one-, two- and three-family homes — known as class one — have a cap in how much the assessed value can increase every year. The assessed value can’t go up more than 6 percent every year or 20 percent over five years.
“It is our hope that your study can paint a clearer picture on why there does not seem to be any correlation between homes that are taxed at similar amounts in different neighborhoods,” Borelli and Matteo wrote.
Mayor Bill de Blasio owns two row houses in Park Slope and benefits from the current system by paying relatively low property taxes. He has pledged not to raise the property tax rate, but opposes implementing a statewide 2 percent cap on the city.
It was the battle of New York City versus the rest of the state Tuesday during an Albany budget hearing, despite somewhat lukewarm statements about it being “one state.”
“Just about everyone agrees we need to rationalize this antiquated system so the burden is applied more fairly, as the inequities have grown over decades,” de Blasio spokeswoman Amy Spitalnick said. “It’s an issue that cuts across the state and city, and won’t be easily reformed.”
The total revenue the city collects from all property taxes is projected to increase, from $22.5 billion this fiscal year to $27.7 billion by fiscal year 2020.