Time to fix the property tax system

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New York City’s notorious property tax system is a sham and desperately in need of a fix.

Property taxes on co-ops and condos (Class 2 properties) bear no relationship to their actual fair market values. In fact, crazy as it sounds, assessed valuations are based on the value of an entire co‑op development as if it were a rental property that an investor wanted to purchase.

Property tax calculations for co-ops and condominiums are riddled with so many assumptions, often incorrect, that they produce erroneous and inaccurate valuations. This byzantine system of taxation has produced property taxes that have dramatically risen, well in excess of inflation. These costs are driving out middle-class families and making co-ops -- often the last bastion of affordable housing -- unaffordable.

Under the current property tax system, co-ops and condominiums (Class 2 properties) are taxed at significantly higher rates than one-to-three family homes (Class 1 properties), despite the fact that they both are residential homes for individuals and families. The type of home one chooses should never affect the fairness of the property taxes that are paid.

To make matters worse, there are no caps to curtail exploding co-op tax assessments as there are in one-to-three family homes. Private homeowners receive an annual property tax assessment cap of 6 percent per year, or no more than 20 percent over five years. Co‑ops have no such caps and not too long ago, many working-class co‑ops in northeastern Queens were hit with single-year, double and triple‑digit assessment valuation increases that caused budgetary chaos.

Not surprisingly, the skyrocketing property taxes that ensued, have played havoc on co-op budgets and caused staggering monthly maintenance increases to owners, many of whom are seniors on fixed incomes.

The mayor, city comptroller, Department of Finance commissioner, New York State Assembly speaker, and many other elected officials all acknowledge that the property tax system is broken, unfair and inequitable. We know this because as co‑president and founder of the Presidents Co‑op & Condo Council, a think tank of board presidents from almost 100 New York City co-ops and condominiums, we have spoken with these elected officials to address this crisis.

Even our modest proposal to grant temporary relief through annual property tax caps that would still allow assessments to rise 8 percent per year, or 30 percent over five years, has been met with inaction. It’s infuriating that year after year, they remain unable to solve this problem.

The problems with the current tax framework are so systemic and the system so complicated that few understand it, which is why it has become virtually impossible to fix. Under pressure from a recent lawsuit and from groups such as the PCCC and others, the mayor and City Council speaker recently moved to create a Property Tax Panel to review the current system and find ways to fix it.

Last year at a town hall meeting the mayor discussed his yet to be created Tax Commission. He said that since he is term-limited and could not run for re-election, he would have greater flexibility in making tough decisions and tackling difficult choices that a tax panel might propose.

In response to my question, he assured me that all stakeholders would have a seat at the table of his commission. Unfortunately, that has not happened. Co-ops that are most affected by this inequitable and discriminatory system will have no representation on the newly announced Tax Panel. Not a single co-op board president or co-op representative will be seated on this panel. However, there are plenty of de Blasio contributors and political supporters sitting on the seven-member panel.

At the announcement of the panel, Council Speaker Corey Johnson said, “It is crucial that we work to bring clarity and fairness to this process, which has long perplexed the public and left many feeling hoodwinked by the city government tasked with representing them.”

Unfortunately, the public is again feeling “hoodwinked” by the very same city government officials tasked with fixing the problem.

Bob Friedrich is President of Glen Oaks Village, a Civic Leader and former City Council Candidate.

Updated 12:32 am, July 10, 2018
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Reader feedback

Justin from Glen Oaks says:
Time to get over it Bob. New York City will never do tax breaks or tax credits. It’s their main source of revenue.
June 16, 8:29 am
Sandra from Glen oaks village says:
Glen Oaks Village is bankrupt. Even Bob can't save it. SOS.
June 16, 9 am
Fred from Bellerose says:
Glen Oaks Village is a discriminating community. They don’t allow blacks and Spanish. Check it out.
June 16, 11:25 am
Helton from Flushing says:
Bob is absolutely right. Without co-op tax relief, the middle class will be further squeezed out of NYC,and DeBozo's crap about "2 cities" will become reality.
June 16, 1:53 pm
Fred from Bellerose says:
Bob can’t do nothing about it. All he can do is let the readers of TimesLedger know he wants attention. Bob is a washed out senior citizen living on social security.
June 16, 2:14 pm
Fred from Bellerose says:
Beside NYC is being squeezed out anyway leaving welfares remains in the five boroughs. Bob is one of the welfare barely surviving.
June 16, 2:16 pm
Man from Queens says:
What a stupid article. Taxes will keep going up. Get over it. Bob is getting dumb and dumber.
June 16, 4:31 pm
Gina from Queens says:
The entire NYC is corrupt. So is Glen Oaks Village. 50% rent controlled tenants paying 500 per month for 3 bedrooms. Crime ridden neighborhood, not worth the money.
June 16, 6:25 pm
Determined from Queens says:
Property taxes should be determined by the amount of money that house is worth for that year. If you bought a house for 200k and that year its worth 500k, then taxes should be charged on 500k. If your house is worth 1.5 million dollars and you bought house for 800k then you should pay the tax on 1.5 million.
June 17, 7:18 am
Juliana from Glen Oaks says:
I live in Glen Oaks, its a senior center and I pay $550 for 3 bedrooms apartment. When someone leaves, Bob sells as a Co-op. Who knows how much he pockets for the finders fee. Lately, the place is a real troublesome with robberies.
June 17, 10:07 am
Carol from Glen Oaks says:
I am one of the board member of Glen Oaks Village. Bob has attacked everyone instead of working with politicians. That's what he gets in return. Grow up Bob!
June 18, 8:43 am
David from Bellerose says:
Property tax is the backbone revenue of New York. It’s distressing and corrupted system. Only elected politicians can control it how they like it. Bob has no say. Sure he can bark all he want for nothing.
June 18, 4:05 pm
Frank from Glen Oaks says:
Bob Friedrich is a dictator. He won’t let anyone challenge him for the board president.
June 18, 7:39 pm

Comments closed.


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