New York's Cooperative and Condominium Community

Habitat Magazine Business of Management 2021

HABITAT

LEGAL/FINANCIAL

HOW LEGAL/FINANCIAL PROBLEMS ARE SOLVED BY NYC CO-OPS AND CONDOS

Another Reason to Reform City's Property Taxes: They’re Racist

New York City

Property tax reform, racism, valuation caps, Bill de Blasio, TENNY.
March 10, 2021

Nationwide data shows that from 2006 through 2016, inaccurate valuations gave the least expensive homes in New York City an effective property tax rate three times higher than the most expensive homes. In Baltimore it was more than two times higher, while in St. Louis it was almost four times higher, according to a report from Bloomberg

These inequities are tucked deep inside America’s system for funding its local governments, tilting property taxes in favor of wealthy homeowners even before any exemptions or abatements. And they carry a jarring implication: The residential property tax, which raises more than $500 billion annually to pay for public schools, fire departments, and other local services, is, in effect, racist.

Since the 1990s New York City has periodically tried to overhaul the property tax system, with fitful and unsatisfactory results. In 2013, a group called Tax Equity Now New York (TENNY) sued the city to force reforms, claiming that the current system favors single-family homes in well-off neighborhoods – as well as co-ops and condos – at the expense of homes in less-affluent areas and rentals.

Some jurisdictions, including New York State, impose caps that limit how much any home’s taxable value can increase in a year, distorting valuations. Studies have shown that the complex cap system in New York has benefited owners of high-priced homes disproportionately. And a high percentage of the owners of those high-priced homes are white.

As the final year of his mayoralty got under way, Mayor Bill de Blasio recently vowed to revive the stalled effort to reform the city’s arcane and inequitable system of levying property taxes. De Blasio claimed the coronavirus pandemic had “derailed” his administration’s reform efforts, the Real Deal reported, but he vowed to get them back on track before he leaves office at the end of this year. “We’ve got to restart this engine,” he said. (Any reforms must be approved by the state Legislature.)

Martha Stark, TENNY’s policy director, isn’t buying the pandemic excuse. “Blaming his inaction on the pandemic shows the mayor’s lack of leadership, courage, and commitment to doing what he could to make New York City’s property tax less of a tale of two cities,” she said. “He had six years to make the property tax system fairer for those who were also hardest hit by the pandemic: Black and brown people, the working class, small businesses, and renters.”

Ask the Experts

learn more

Learn all the basics of NYC co-op and condo management, with straight talk from heavy hitters in the field of co-op or condo apartments

Professionals in some of the key fields of co-op and condo board governance and building management answer common questions in their areas of expertise

Source Guide

see the guide

Looking for a vendor?