The State Legislature has passed a long-awaited tax relief bill for city co-op and condo owners, despite a cluster of lawmakers who voted against it.
The bill, approved by the State Senate and Assembly, includes raising a partial tax abatement from 17.5 percent to 25 percent and extending the J-51 program to June 30, 2015. The abatement reduces the difference in property taxes paid by Class 2 co-op and condo properties and one, two and three family homes in Class 1, and the J-51 gives owners partial property tax exemptions for capital improvements.
“This is a major victory for the vast majority of co-op owners in northeast Queens, including thousands of senior citizens on fixed incomes,” said Assemblymember Ed Braunstein.
But seven Democratic state senators and seven Democratic assemblymembers opposed the omnibus bill, which included a measure that gives tax abatements to 15 plots in midtown and downtown Manhattan being developed as luxury condominiums and office buildings.
“This bill only benefits the rich,” said State Senator Ruben Diaz of the Bronx. “It is a multimillion [dollar] program of rent exemptions and abatement for landlords who renovate their buildings.”
Diaz said he feared capital improvements under the J-51 program would lead to landlords raising rents on their tenants.
“To vote for this bill, we might be sending the message, an impure message, that we are only working for the landlords and against the tenants,” Diaz said.
State Senator Toby Ann Stavisky said she voted in favor of the bill because of the vital abatements to city co-op and condo owners but believed the abatements to luxury developments were a “giveaway of city money.”
“The developers would be building this anyway. They don’t need the tax abatement,” she said. “We unfortunately can’t pick and choose the parts of the bill we want to vote for.”
State Senator Brad Hoylman of Manhattan said he was “outraged” the abatement extensions were put into a packaged bill and “rushed through the Rules Committee onto the Senate floor with only 30 minutes’ notice.”
“The bill subverted the normal committee process and required an ‘up or down’ vote, which was difficult as the bill contained some provisions that gave me and my Democratic colleagues pause,” he said.
The bill requires another Senate vote before Governor Andrew Cuomo can sign it into law.
Its assurances come after panic spread throughout co-op and condo communities at the end of June, when the Legislature adjourned session without extending the J-51 program and the expired abatement.
A pair of audits released last year by the city’s comptroller office found the Department of Finance at fault for causing upheavals in condo and co-op property values — a determining factor in property taxes — when it changed its formula for calculating them in fiscal year 2011-12.