Nassau, Suffolk, Long Island, NYC - Real Estate Property Tax Reduction

CERCLA - ENVIRONMENTAL CONTAMINATION - POLLUTION & ITS EFFECT ON YOUR PROPERTY TAXES

2011-06-09T10:11:00.009-04:00

Richard G. Fromewick is the Chair of the Tax Certiorari & Condemnation Law Practice at Meyer, Suozzi, English & Klein, P.C.

The real estate world is becoming increasingly environmentally conscious and polluted properties are not well-tolerated. As the mindset has formed on the environment there is increasing vigilance through requiring remediation of polluted properties. Whether the pollution is from above with chemicals and oil permeating the ground or chemical and oil leaks from underground tanks or even flowing underground from another property, citations for cleaning up are issued in increasing numbers.

The cost of clean up or remediation can be somewhat ameliorated by lower tax assessments due to the loss in market value. In a case of first impression litigated by my firm, the New York State Court of Appeals in Commerce Holding Corp. v. Board of Assessors of Babylon found that the taxpayer was entitled to deduct the cost of remediating from the market value of the property in its normal state.

This decision has a substantial impact on property owners facing an environmental clean up. Under the Comprehensive Environmental Response Compensation and Liability Act (“CERCLA”) of 1980, a property owner is liable for the cost of cleaning up polluted property even if that owner can prove that they were not in any way responsible for the contamination, as was the case in Commerce. Under CERCLA, the owner is considered a “potentially responsible party” and will be strictly liable for the clean up costs. This is true even if the property is purchased after the contamination has been discovered. This standard requires owners of real estate to take extra precautions because the cost of any clean up will be imposed on them if the property is contaminated or becomes contaminated.

To those owners who have been cited and must pay clean up costs, the decision in Commerce offers some relief because it allows them to petition the assessor to reduce their tax burden on the property. Under Commerce, the assessor must first determine the value of the property as if it was uncontaminated and then subtract the entire remaining cost of the clean up from that value. This reduction takes into account that anyone looking to purchase the property would require that the sale price reflect the cost of cleaning up the property. In effect, this decision recognizes that property worth $1 million if uncontaminated but requiring $500,000 worth of environmental clean up is only worth $500,000 and should be taxed accordingly.

Purchasing and owning real estate is becoming more complicated all the time. The key to making a profit despite these complications is to be well-informed about all of your options, particularly when dealing with complex matters such as environmental clean up and taxes. If you have been cited for contamination, you have the ability to have your property taxes reduced to reflect the reduced value of your property. If you have been paying clean up costs, you should verify that your assessment was adjusted to reflect the cost of the clean up. You can check your property assessments in Nassau County by going to http://www.mynassauproperty.com/ or by logging on to http://www.mlsli.com/. Typically, the assessor will not adjust an assessment on its own, leaving it up to you to make an application to reduce the assessment through a tax certiorari proceeding.

GREAT ASSESSMENT NEWS!

2011-05-05T12:32:00.000-04:00

Most municipalities, including Nassau County, assess properties at a fraction of its estimated fair market value. The Nassau County Assessor has claimed for the past several years to be assessing commercial properties at 1% of its fair market value. However, we have just entered into an agreement with the Nassau County Attorney’s Office to negotiate the 2011/12 and 2012/13 assessments as though the assessments are based on .905% of the actual fair market value.

What exactly does this mean?

If a property is assessed at 10,000, the County Assessor’s website would claim a fair market value of $1,000,000. However, due to the agreement mentioned above, the County Attorney’s Office will negotiate tax reduction proceedings as if the property is assessed as worth $1,105,000.

Thus, if the property is really worth $1,000,000, and the County agrees to negotiate as if the property is assessed at $1,105,000, then the taxpayer would get a 10% reduction in assessment to bring their estimated fair market value down to $1,000,000.

The moral of this story … there is more than one way … to get a tax reduction.

NASSAU REAL ESTATE TAX ASSESSMENTS IN TURMOIL

2011-02-28T15:01:00.000-05:00

Many Nassau County tax assessments have been reduced, but beware! Tax rates will have to be increased to meet the budgets. Almost daily we see a news story or opinion article on the outdated and broken Nassau County real estate tax assessment system. The probable take over of Nassau finances by NIFA (Nassau Interim Finance Authority) exacerbates the situation. Recently the County Executive announced a private appraisal firm would negotiate the real estate tax protests with the tens of thousands of homeowners complaining about their assessments. The administrative review of the commercial cases has all but stopped. There is a lot going on but so far the system has become more complicated and cumbersome. Maybe that's the plan.

NASSAU & SUFFOLK ASSESSMENT ERRORS CAN BE CORRECTED

2010-08-12T17:18:00.000-04:00

Everyone paying real estate taxes for commercial property should verify their assessments.

Substandard tax assessment systems create many errors.

On Sunday March 21, 2010, Newsday featured a lengthy article about Nassau County's substandard real estate tax assessment system. It was an extremely unflattering story and, regrettably for Nassau County real estate taxpayers, it was all true. Nassau's assessment system is broken and has been in disarray for many years. There are over 420,000 individual parcels in Nassau County, yet the County does not have the infrastructure to value them correctly. There are several different computer systems used in the assessor's office, unfortunately the programs frequently contain different information due to human errors made while inputting data from one system to another.

Examples of assessor's office mistakes over the years include the assessment of a half-acre parcel as a two-acre parcel, and the assessment of a three bedroom split-level house as a five bedroom colonial house. Some mistakes will have no affect on the real estate taxpayer because the assessment, despite erroneous descriptions, can still be based on the correct market value. However, some mistakes can result in unrealistic market values and inflated real estate tax bills. For example, a converted residence containing a small medical office being assessed as a commercial property with commercial tax rates was reversed back to a residential property tax rate, resulting in a 75% reduction of the taxes.

Assessments have to be protested every year, with a very small window of time in which to do so. The tentative Nassau assessment roll is released on January 2nd and protests must be filed by March 1st. The good news is that assessor mistakes are in a category of their own and can be corrected, even if a protest was not filed prior to the years March 1st deadline.

Everyone paying real estate taxes for property in Nassau County should go to www.mynassauproperty.com to verify the County's description of your property and compare your assessments to similar properties. You can also do this by logging on to www.mlsli.com. It only takes a few minutes, and in the end could generate substantial savings.

If you thought living or owning property in Suffolk County could solve all your assessor woes, think again. Not only is the Suffolk County protest filing deadline shorter than Nassau County (the tentative role is released May 1st with a May 18th protest filing deadline), the Suffolk County town assessors makes their share of mistakes as well.

Recently, it was discovered that someone was paying taxes on a parcel of land that was completely submerged under water. The County refused to believe that the land was underwater but pictures proved otherwise and a reduction was obtained. In another case, an old 40-foot tall industrial building previously used as an aircraft hanger was still being assessed as though the owner was using all 40 feet of space. After the assessor was made aware of the fact that it was being used for assembly work at tables, with no planes in site, a large reduction was obtained, as the unused height of the building was obsolete.

Unfortunately for Suffolk County residents there is not a single website to log into and verify assessment records. Give your local Town and Village assessors a call and find out how you can obtain your property information. You might be amazed at what you have been paying taxes on.

Busy, Busy, Busy...

2010-05-13T16:54:00.000-04:00

A few days ago, Newsday announced my election to the Garden City Chamber of Commerce Board of Directors. My phone has been ringing off the hook with congratulations. Aside from the congratulatory wishes, I have also been getting calls from my clients.

Nassau clients are asking if their taxes are being reduced as a result of our January protest filing. Unfortunately, it is too soon to tell. Suffolk clients are asking if I can lower their taxes by the May 18, 2010 grievance filing deadline. Unfortunately, we cannot lower the taxes before the filing deadline because we have to give Suffolk Assessors a chance to review the grievance applications. Suffolk assessments have stayed fairly consistent, despite numerous foreclosures. Against all common sense, many of the Southampton assessments have been greatly increased.

Luckily, I have a great staff working full throttle during this busy tax system to meet everyone’s needs. The only thing more I can ask for is the weather to hold out for golf this weekend.

Nassau County Grasping At Straws

2010-04-19T12:34:00.000-04:00

As a real estate tax reduction professional, I was offered an opportunity to appear on News 12 “Long Island Talks - with Lea Tyrell”, which I gladly accepted. My role on the program was to comment on the current debate between County Executive Edward Mangano and County Legislator Wayne Wink.

The County has put forth a plan to reassess residential properties every four years, instead of current annual reassessment. Additionally, commercial taxpayers would be required to have a certified appraisal prepared for their property or face a $5,000 fine.

My response? No Good! The County cannot even correctly assess one year at a time. How can they even think about applying the wrong assessments to properties for a four year period? Furthermore, the requirement for certified appraisals at the commercial taxpayer’s expense in order to get a hearing to protest over assessments is not only illegal, but also bad politics.

To make matters worse, if that is even possible, the County believes that real estate property tax refunds are putting the County in debt; certainly paying back school taxes that the County does not collect is crippling. Their solution? To do something to prevent taxpayers from getting back such high refunds.

My response? The money belongs to the taxpayers who paid on wrong/excessive assessments. We are only trying to get back money that the County should have not required taxpayers to pay in the first place.

There are rumors that the County is reworking this plan. Until then, the saga continues as the County tries any which way to prevent tax protests on a yearly basis, instead of focusing on the real issue…the assessors inability to correctly assess.

Suffolk County Property Tax Assessments Mailing

2010-03-26T10:07:00.000-04:00

Watch out for a plain looking correspondence from your Suffolk town assessor. Do not throw it away. It is a potential missive of higher taxes. The letter might even describe a lower real estate assessment. A lower tax assessment does not necessarily mean lower taxes; it more likely means higher tax rates. Similar to Nassau each school district and special district has its own special tax rate. Therefore, everyone in Huntington does not pay on the same tax rate. Where Southampton town did a revaluation a few years ago the town of Babylon has not done a revaluation in decades. The bottom line is you won’t know your bottom line until the tax bills arrive in December and then it will be too late to complain.

Correcting Nassau County Assessment Errors

2010-03-25T10:37:00.000-04:00

On Sunday March 21, 2010, Newsday featured a lengthy article about Nassau County’s substandard real estate tax assessment system. It was an extremely unflattering story and, unfortunately for Nassau County real estate taxpayers, it was all true. Nassau’s assessment system is broken and has been in disarray for many years. There are over 420,000 individual parcels in Nassau County, yet the County does not have the infrastructure to value them correctly. There are several different computer systems used in assessor’s office, frequently containing different information due to human errors made while inputting data from one system to another.

Examples of assessor’s office mistakes include the assessment of a half-acre parcel as a two-acre parcel, the assessment of a three bedroom split-level house as a five bedroom colonial house, etc. etc. etc. Some mistakes will have no affect on the real estate taxpayer because the assessment, despite erroneous descriptions, can still be based on the correct market value. However, some mistakes can result in unrealistic market values and inflated real estate tax bills. The good news is that these mistakes can be corrected, even if a protest was not filed prior to this years March 1, 2010 deadline.

Everyone paying real estate taxes for property in Nassau County should click here to verify the County’s description and compare your assessments to your neighbor’s. It only takes a few minutes, and in the end could save you $$$.

15 Seconds of Fame

2010-02-17T14:09:00.001-05:00

Residents Concerned Property Taxes Have Errors - Rick Fromewick featured on News 12

Posted using ShareThis

It was so nice to be considered an expert on Tax Certiorari by News 12 about Nassau County's Assessment system, especially because the last date to file for a property reduction is Monday, March 1, 2010. After all my preparations and stress of answering the reporters questions I managed to get about 15 seconds of fame. Maybe Andy Warhol was right. At least they left my response that, "Assessments are usually wrong, that's why most people file for a tax reduction.”

Nassau County and New York City Real Estate Tax Protests

2010-02-16T10:51:00.001-05:00

Real estate values are continuing to fall in many areas, and certainly for commercial properties it may get even worse. So, when tax assessments are reduced, it's only appropriate. However, many assessments are not reduced nearly enough. The assessments are very uneven with some areas being reduced by 20% and other areas reduced by only 3%-5%. That's why every assessment should be checked. And guaranteed lower assessments will generate higher tax rates. A grievance, also called a complaint, or application to reduce property tax, must be filed by March 1, 2010 to protect your rights to protest your 2011/2012 assessment.

Nassau County Tax Assessments

2010-01-08T15:51:00.000-05:00

Many Nassau County tax assessments have been reduced. Don't be fooled by lower Property Tax Assessments. Property tax rates will necessarily be raised to compensate for the lower assessments. A grievance, also called a complaint, or application to reduce property tax, must be filed by March 1, 2010 to protect your rights to protest your 2011/2012 assessment.