Tax rates on hold until after election

Real Estate Weekly, Oct 21, 1998 by Lois Weiss

The Council had been astonished by the scathing letter Mayor Rudolph Giuliani insisted on inserting with the July 1st tax bills. By not yet setting a vote on the tax rate fixing, the Council could effectively protect the bills from becoming the innocent transporters of yet another mayoral attack on the Council, and in particular on Council Speaker Peter Vallone, who is running an uphill campaign against Governor George Pataki.

The Governor has already tallied the Speaker's routine votes on the nearly always increasing property tax rates, and has relayed them en masse in critical TV advertisements. What Vallone doesn't want is another attack that is essentially funded by taxpayers.

Even though a joint mayoral and Council agreement capping increases at 2.5 percent rather than 5 percent protected homeowners from a larger increase, Class I homeowner's overall fiscal year tax rate will still go up from last year - from $10.849 to $10.961 per hundred dollars of billable assessed value. Therefore, the tax fixing vote alone could be huge grist for the political advertorial mills - forget that the Mayor agreed to this, too.

Unless a special Council meeting is called beforehand, the overall 98/99 rates are expected to be voted into place at a scheduled Council meeting on Thursday, November 12th. The new rates would be: Class II apartment buildings, $10.739; Class III utilities, $8.80; and Class IV commercial properties, $10.236.

And that means the Finance Department can't generate and print or mail out property tax bills for the second half payments until that weekend.

Last spring, along with budget differences, the City Council and Mayor also differed on where the excess tax burden should be applied, and for a time, on what percentage less of the statutory limit of 5 percent should be allowed as a maximum increase. That meant agreeing on a bill for Albany to pass, which they finally did long after the property tax bills needed to be mailed for July 1 payments.

To ensure the City could collect property tax money, the City Council therefore set temporary tax rates based on those set for the 1997/98 fiscal year, but billed on the new budget numbers. The tax rates for the 1997/98 roll, and therefore July, 1998 tax bills, were: Class I, $10.849; Class II, $11.046; Class III $8.282; and Class IV, $10.164.

Since last year, because of equalization issues and the voted 2.5 percent cap, Class I and IV actually are going up less than 1 percent, while Class II is going down about 3 percent. The utilities have a 6.25 percent increase, but that would have been close to 9 percent with the 5 percent cap.

The overall tax rate for the city is still frozen at $10.366.

To figure out about what you will owe for the first half January, take what is expected to be the new Fiscal Year 1998/99 rate, multiply by your final billable assessment which will be the lesser of the actual or transition assessment - and then subtract what you have already paid.

Council sources also indicated they are truly concerned about the lateness of the billing and are worried there won't be enough notice for owners who want to take advantage of the annualized 2 percent discount by paying in full by December 2nd. They are researching the statute and staffers are working together behind the scenes to make the billing as easy as possible for property owners.

According to a Finance Department spokesperson, to receive the discount, the "high dollar" properties have to get the check postmarked or stamped into the Finance City Collector offices by December 2nd, while homeowners will have until December 17th.

While payments are not due until January 1st, since that is a Friday, they will officially be marked in without penalty if received over the counter or postmarked by January 4th.

Those eligible for the grace period have until January 15th. That's when the 1999/2000 tentative fiscal year assessments should be out and the process starts anew.

If mailing payments, tax certiorari attorneys advise sending the check by certified mail, return receipt requested. Always write the borough, block and lot number applicable to the payment on the face of each check. Remember that a separate check for each tax lot bill will help keypunchers apply the money appropriately.