County considering tax exemption for infrastructure improvements

Tompkins Weekly Staff

Tompkins County is taking aim at easing the tax burden on developers making infrastructure improvements.
The Legislature is considering adopting a local law that would, if approved, adopt a permitted exemption under New York State Real Property Tax Law on infrastructure improvements made by a developer. The proposed law would provide a three-year abatement of County tax on the increase in value due to improvements made to public infrastructure (utilities and road), as long as the developer retains ownership of the newly subdivided lots. Those holding costs are described as one of the many impediments to building for-sale housing.

A public hearing on the law will take place at 5:31 p.m. Tuesday, June 6. The public hearing was approved by a 10-2 vote of the Legislature – legislators Carol Chock and Jim Dennis voted no, while legislators Will Burbank and Peter Stein were excused.

Legislators Chock and Rich John were among those who expressed some concern during discussion before the vote – both suggesting that, since it cannot be focused on specific areas or types of development, it could support sprawl. John characterized it as a “blunt instrument” to deal with the housing issue, as he had during a recent meeting of the Legislature’s Government Operations Committee.

Asked by Legislators to comment, Commissioner of Planning and Sustainability Ed Marx noted that an issue has been identified as part of the County’s housing needs assessment that no new neighborhoods are being built. While there could be some sprawl, he believes the proposed exemption might provide marginal help.

During the Government Operations Committee meeting earlier this month, county Director of Assessment Jay Franklin told the committee the exemption could not be focused on particular areas or types of housing developments, such as for-sale or affordable housing. At that meeting, Chock had said she would have preferred delaying making any recommendation on the proposed Local Law until after the hearing is conducted. Local developer Sue Cosentini addressed the committee, saying that, while there is “no magic bullet” to spur development of affordable housing, having such an exemption would help.

While this initiative is moving forward, a second one has stalled following a split vote.
The Legislature was considering a proposal to request to New York State to amend the Real Property Tax Law to allow a local Tompkins County option to provide a partial exemption for multi-unit residential properties converted to owner-occupied residences, as has been authorized as a local option for several other cities.
Proposed as a potential way to encourage owner-occupied housing, the exemption, if requested and approved by the state, then adopted by the Legislature, would have prevented any increase in assessment in the first year, then slowly add the increase to the tax base over the next seven years.

After considerable discussion, the vote was 7-6 – with legislators Jim Dennis, Glenn Morey, Dave McKenna, Mike Sigler, Peter Stein and Chairperson Michael Lane voting no, and Legislator Will Burbank excused – failing to muster the eight votes required for passage. Several Legislators said they felt there were too many unanswered questions at this point, and that it might have the adverse consequence of reducing rental units.

Legislator Martha Robertson, who maintained that the idea has promise, said the county would simply be asking the state to approve the option, and that there would be more time to consider it before any final decision, but Lane said that if the Legislature would be making such a request from the state, it should be prepared to adopt the measure, if granted.