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Nov 25, 2019

Outdated Orangetown assessments a boon to some Piermont businesses and homeowners

Orangetown has not updated its assessment rolls in 33 years and comparing those values to up-to-date assessments in the town’s village of Piermont reveal large discrepancies.

 Tax Watch columnist David McKay Wilson visits Piermont, where inequities in New York’s property tax system are revealed.

 Property taxes depend on the value of real estate.

But that can be perplexing for property owners in a system like New York’s that allows your real estate to be valued at vastly different amounts by differing taxing entities.

It can be even more confusing if the same assessor assigns the different values.

That’s the situation facing Rockland’s village of Piermont, on the Hudson River’s western shore, in the town of Orangetown. BrianKenney has been the assessor for both the village and town since 1995, assigning two different values for the same properties. Each year, Kenney certifies that the separate assessment rolls — that contain assessments for Orangetown and its village of Piermont — are both “a statement of fact.”

It is upon these so-called “facts” that ten of millions of dollars in property taxes are charged each year.

Orangetown assessment winners

These lots had a lower assessment in Orangetown than the Piermont assessments.

The word “fact” takes on a whole new meaning when you enter the complex world of Orangetown assessments. New York is the only state in the nation to allow municipal assessors to give your property different taxable values, said Mike Ardis, of theInternational Association of Assessing Officers, which sets standards and has a certification program for assessing profession.

In addition, New York does not require municipalities to conduct periodic revaluations of their real estate, as is required in 42other states. Orangetown has not updated its assessment rolls since 1986. Instead, the town relies on the imperfect state equalization rate that’s supposed to bring the outdated assessments to current market levels.

In the late 1980s, when the Orangetown values were set, Piermont’s waterfront featured vacant industrial buildings that were later demolished. In their place came tony waterfront condominiums, art galleries and restaurants.

Piermont, meanwhile, has updated its assessment roll annually since 2006, to reflect the dynamics of the local real estate market.

A Tax Watch review of the 2018 assessments in Piermont found that the village assessment roll lists an estimated $75 million in additional taxable value — about 14% more — than the Orangetown values for the same properties, when you use the equalization rate to bring the Orangetown assessments to market value.

It’s a similar scenario to what Tax Watch found in September in the town of Eastchester and its village of Bronxville where a comparison of assessments found almost $300 million in real estate that was taxed for village purposes but not by the town and county.

The biggest beneficiaries in Piermont are the owners of commercial property in downtown Piermont and the owners of high-end properties along the waterfront and on the narrow hillside streets leading down to the Hudson.

With lower assessments, many of these owners pay lower property taxes for South Orangetown schools, the town and RocklandCounty, with whatever they save paid by other property owners.

The state of revaluation

Across the Hudson Valley, whether your municipality’s rolls are updated depends on which county you live in. Only 7 of 25Westchester municipalities have conducted a reassessment since 1987, with 8 last doing so at least 50 years ago. Five of sixRockland towns last conducted a revaluation in the 1980s, with Haverstraw’s 2006 revaluation as the most recent.

In Dutchess County, 15 of 20 municipalities revalued in 2018 or 2019 while in Putnam, five of six towns did a revaluation in 2018 or 2019, with Philipstown, where Kenney also serves as the assessor, last doing one in 1996.

In Orangetown, Kenney said he was doing what’s prescribed by New York state law.

“The rolls are for separate municipalities,” he said. “The state has verified our overall levels of assessment after looking at the previous year’s market and calculated further market trending on their part and they have agreed and issued equalization rates for the town and the village and the class rates for the two classes of properties based on what they have seen.”

Tax attorney David Wilkes, of Tarrytown, said Kenney was working within New York’s flawed property-tax system.

“This scenario puts a municipal employee like Brian in an impossible position,” Wilkes said. “He is commanded to put out an assessment roll and handed circumstances that don’t line up. It’s a matter that should be addressed in Albany.”

Don’t expect much help from the administration of Gov. Andrew Cuomo, which has shown little interest in reforming New York state’s property assessment laws. Without a law requiring periodic revaluations, the decision to update assessment rolls is a discretionary act by elected officials. In other states, revaluations come on a regular cycle as an administrative function of good government.

Calls and emails to the state Department of Taxation and Finance regarding Piermont’s dueling assessments were not returned. The stakes are high for Piermont property owners.

The Orangetown assessments are used for an estimated 94% of a Piermont resident’s property tax bill, covering taxes for SouthOrangetown schools, Rockland County, and the town. Piermont assessments are used for village taxes, which comprise about 6% of the annual bill.

Different values abound

Take a stroll along Piermont’s commercial district, where Village Hall stands, to have a taste of Kenney’s assessment stew. Adjacent to Village Hall, at 482 Piermont Ave., a building that houses Sidewalk Bistro and some apartments were valued by Orangetown in 2018 as if it was worth $772,000. The village, however, pegs its value 78% higher at $1.4 million.

Piermont assessment winners

 These lots had a lower assessment in Piermont than the Orangetown assessments.

Even folk singer Tom Chapin does well by Orangetown. His home on 57 Piermont Place is valued at $718,000 by the town and $925,000 by the village.

Like many homeowners contacted on the issue, Chapin was unaware of the dual taxable values. “I was not aware of this until you brought it to my attention,” he said.

Then there’s the home of Piermont Village Trustee Ivanya Alpert at 31 Liberty St. The town has it valued at

$360,000 while the village pegged its value 63% higher at $588,100.

Deputy Mayor Mark Blomquist’s home at 106 Ash St. is valued for $344,396 by the town and 44% more at $496,900 by the village. There is no way for Orangetown to raise his town assessment unless it conducts a townwide revaluation, which the town has no intention of doing any time soon.

“That’s why we update our village rolls every year,” said Blomquist. “It’s the only fair way.”

Kenney said the disparity in commercial values in blunted by the town’s adoption of the homestead option, which allows different tax rates for commercial and residential property. The town’s school tax rate is 77% higher for commercial properties, according to town records.

On the flip side

At scores of other properties, the scenario gets flipped, with Orangetown values higher than those for the village, especially among the village’s condominiums, some of which were built over the past 20 years to replace industrial buildings along the riverfront and others that went up in the 1960s and 1970s along Route 9W.

The Paradise Harbor Condominium, which comprises 82 units on the waterfront, settled assessment cases in 2018 with the village and 2016 with the town, agreeing to the different values.

Taxable value of many condominiums in Piermont’s Lawrence Park development along Route 9W are typically two times higher than their village values. Assessor Kenney said the condominium association had grievances pending for the tax years 2001 to 2009, but withdrew the action without receiving reductions.

Owners who feel they are over-assessed can annually file grievances, which Kenney said abound in Orangetown but are rare for the values he updates each year in Piermont.

“We get 400 to 500 grievances each year in Orangetown, and those values get lowered if they are too high,” said Kenney. “It’s like amini-revaluation each year. Of course, the ones that are too low aren’t going to say anything.”

Kenney’s tape measure

One problem with the outdated Orangetown assessment is the state’s equalization rate, a formula which is a townwide average of market values that does not address increases in certain neighborhoods that have shown greater-than-average appreciation, like those on the waterfront or with cherished river views.

Kenney can add the value of improvements, but that’s often not enough to bring it up to a property’s market value.

“It’s as if I used a tape measure that was missing a foot to measure a house,” Kenney said. “As long as I use the same tape measure for everyone, it’s fair. For Piermont, we used a correct tape measure for all and that’s fair too — perhaps fairer, but still, not enough of a difference to reduce property taxes to a significant degree.”

No reval for Orangetown

Orangetown Supervisor Christopher Day and members of the Orangetown Town Board say they have no interest in conducting a revaluation, even though its last update was conducted 33 years ago.

Doing so, they say, would penalize Orangetown when it comes to its share of the county’s $125 million tax levy. The levy is split among Rockland’s five towns, based on the assessed values in each town. If Orangetown revalued and the others didn’t, its taxbase would mostly likely grow, and its taxpayers would pay incrementally more in county taxes.

Two of Orangetown’s four school districts — Nanuet and South Orangetown — straddle its border with Clarkstown, so expandingOrangetown’s tax base could make Orangetown property owners responsible for a greater share of those school districts’ tax levy.

It’s the same argument used in Eastchester to put off conducting updating its rolls for the first time since 1941. Town Supervisor Tony Colavita said he wouldn’t move to update the town’s assessment unless every town in the county did so as well.

Day said he would only consider a revaluation if the county’s four other municipalities agreed to do so. But he made no such attempt during his tenure as supervisor, which will end on Dec. 31.

“One of the risks of a single town doing it on their own is that it would cause issues in apportionment for county and overlapping school district taxes versus the other four towns who did not do it,” he said. “It’s not about keeping our share of those taxes‘artificially low,’ it’s about keeping them correctly proportional to the other towns and not making them artificially high versus those towns.”

Orangetown Town Board member Tom Diviny wondered whether Rockland County would lead that effort.

But County Executive Ed Day, the Orangetown supervisor’s father, recalled that Rockland spent $4 million on a countywide revaluation in 1999. That effort was never completed, and while some of the data was used, the assessment rolls were not updated.

Day estimated it would cost $20 million for a countywide revalution in 2020.

“The only way to get rid of the issue is to have full revaluation, across the board,” Day said. “But I’m not going to put aside $20million have it fall apart in short order.”

 

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