§ 11-269 Industrial and commercial real property tax abatement.
AC § 11-269
a. Subject to the provisions of this part, tax abatement benefits shall be available to eligible recipients in accordance with the provisions of this section. b. Amount of abatement base.
(1)Calculation of abatement base. Except as provided in paragraph (5) of subdivision c of this section, the abatement base used to determine the amount of the abatement provided under this part shall be the amount by which the post-completion tax on a building or structure exceeds one hundred fifteen percent of the initial tax levied on a building or structure.
(2)Initial tax on building or structure.
(a)Determination of initial tax. The initial tax shall be determined by multiplying the final taxable assessed value, without regard to any exemptions, shown on the assessment roll with a taxable status date immediately preceding the issuance of the first building permit by the initial tax rate. For purposes of this subdivision, the initial tax rate shall be the final tax rate applicable to the assessment roll with a taxable status date immediately preceding the issuance of the first building permit. If no permit was required, the initial tax and the initial tax rate shall be determined based on the assessment roll with a taxable status date immediately preceding the commencement of construction.
(b)Effect of tax lot apportionment or merger. For a property as to which an applicant has applied for benefits pursuant to this part, if such property is apportioned or merged and such apportionment or merger is not reflected in the assessment roll described in subparagraph (a) of this paragraph, the initial tax for the newly created tax lot or lots shall be based on the initial tax of the lot or lots from which they have been created, which shall be apportioned among the newly created tax lot or lots in the manner established by the department for purposes of assessed valuation of real property.
(3)Post-completion tax on building or structure. For purposes of calculating the abatement base only, the post-completion tax is determined by multiplying the initial tax rate by the final taxable assessed value, without regard to any exemptions, that would be shown on the assessment roll but for the abatement, on the assessment roll with a taxable status date immediately following the earlier of: (a) completion of construction; or (b) four years from the date of issuance of the first building permit, or if no permit was required, the commencement of construction.
(4)(a) If the taxable assessed value is later reduced by a court order or application to the tax commission, then the initial tax or the post-completion tax shall be the tax as reduced.
(5)Mixed-use property. For a mixed-use property, the initial tax and post-completion tax shall be apportioned between the residential and nonresidential portions. The department may promulgate rules to determine the method of apportionment.
(6)Initial taxes not to be reduced by abatement. Except as provided in paragraph (5) of subdivision c of this section, the abatement provided under this part shall not be applicable in any year of the benefit period to the initial tax or to the tax on the portion of the assessment attributable to land. Additionally, the abatement shall not result in any credit or refund of real property taxes. c. Industrial and commercial abatements.
(i)Industrial construction work. (A) Effect of assessed valuation increases. For years two through thirteen of the benefit period, except as provided in item (B) of this clause, if there is any increase in tax in that year that is based on an increase of taxable assessed valuation since the immediately prior tax year, such excess tax liability shall be added to the amount of the abatement base. Such addition to the amount of the abatement base shall be determined using the initial tax rate. (B) Physical increases. Notwithstanding the provisions of item (A) of this clause, if in any of years two through thirteen of the benefit period, a physical change to the property results in an increase in the taxable assessed value of the property of more than five percent for that year, then any increase in taxes for that year shall not be added to the amount of the abatement base in any year. (C) If the taxable assessed value upon which an adjustment to the abatement under this paragraph is based is later reduced by a court order or application to the tax commission, then the appropriate adjustment to the abatement base shall be made in accordance with the reduced taxable assessed value.
(ii)Mixed-use property. For a property as to which benefits are given for both industrial and commercial construction, the inflation protection provided under this subparagraph shall be based on the predominant use of the property as determined by the department.
(c)Minimum required expenditure. For industrial construction work or commercial construction work in a special commercial abatement area, the minimum required expenditure is thirty percent of the property's taxable assessed value in the tax year with a taxable status date immediately preceding the issuance of the first building permit, or if no permit was required, the commencement of construction. Expenditures for residential construction work or construction work on portions of property to be used for restricted activities shall not be included in the minimum required expenditure.
(2-a)Abatement for industrial construction work on a peaking unit. Upon approval by the department of a final application for benefits, an applicant who has performed industrial construction work in any area on a peaking unit, shall be eligible for an abatement of real property taxes, as follows: (a) Amount of abatement. The first year of the abatement shall be the tax year with the first taxable status date that follows the sooner of (i) completion of construction; or (ii) four years from the date the first building permit was issued, or if no permit was required, the commencement of construction. For years one through fifteen, the abatement shall be the amount of the abatement base. The abatement shall be adjusted for inflation protection as provided in subparagraph (b) of this paragraph. The following table illustrates the abatement computation: Tax year during benefit period:Amount of abatement:Years 1 through 15 100% of abatement base (b) Inflation protection.
(iii)If the taxable assessed value upon which an adjustment to the abatement under this paragraph is based is later reduced by a court order or application to the tax commission, then the appropriate adjustment to the abatement base shall be made in accordance with the reduced taxable assessed value.
(d)Minimum required expenditure. For renovation construction work in renovation areas, the minimum required expenditure is thirty percent of the property's taxable assessed value in the tax year with a taxable status date immediately preceding the issuance of the first building permit, or if no permit, was required, the commencement of construction. Expenditures for construction work on portions of the property to be used for retail purposes that exceed five percent of the building or structure in renovation areas defined in paragraphs (2) and (3) of subdivision c of section 11-274 of this part, for residential construction work, or for construction work on portions of the property to be used for restricted activities, shall not be included in the minimum required expenditure.
(7)(a) No benefits under this part may be received by a property that is concurrently receiving exemption or abatement of real property taxes under any other law, except for an exemption under (i) section four hundred twenty-a, four hundred twenty-b or four hundred fifty-nine-b of the real property tax law; or (ii) any section of the real property tax law as to which the city has enacted a local law to implement such exemption and as to which exemption is granted only if the property is the primary or legal residence of one or more of the owners of the property, including such sections in which exemption may be granted if an owner is absent from the residence while receiving medical benefits; or (iii) title two-D of article four of the real property tax law for a separate project involving separate parts of the building or structure that was completed prior to the application for benefits.
