Maxwell School, Syracuse University

SYRACUSE UNIVERSITY
The Maxwell School of Citizenship and Public Affairs

 

PAI735/ECN635
 State and Local Government Finance

Professor Yinger

 

 

Syracuse, New York
Memorandum

 

To: Common Council

From: John C. Gamage

Date: September 6, 1995

Re: Reassessment & Homestead Option
 

The Homestead Tax Option is a provision of the New York State Real Property Tax Law which authorizes municipalities completing reassessments to establish two separate tax rates: a lower tax rate for residential properties and a higher tax rate for all other properties. The effect of the 2 rates is to prevent a shift of some of the tax burden from the non-residential class of property to the residential class.

We anticipate that we will have detailed information available for Common Council review in a few weeks, which will compare the tax shifts which will result from reassessment in both dollars and percentages on a Homestead and Non-Homestead basis.

There are several important aspects of the Homestead Tax Option which you should be aware of:

  1. It does not apply to County taxes, which account for 42% of taxes paid by City property owners this year. This means that a shift of taxes will occur from the non-residential class to the residential class even if the Homestead Tax Option is used for City tax purposes.

  2. The City may alter the Homestead Tax Option to allow a specific portion of the shift to occur. The increments authorized by Section 1903 are 10%, 20%, 25%, 30%, 40%, 50%, 60%, 70%, 80%, 90%, and 100%.

  3. The Homestead Tax Option can be rescinded in the future by passage of a local law.

City School District and the Homestead Tax Option

The Homestead Tax Option may be used for School taxes if the City uses it for City tax purposes. If it is used for City taxes, it will also apply to School taxes unless the Board of Education passes a resolution to use a uniform tax rate, and holds a public hearing prior to the levy of taxes.

 
Important Dates

There are 3 possible ways to handle the disclosure notices:

  1. They can be calculated on a Non-Homestead basis

  2. They can be calculated on a Homestead basis

  3. It may be possible to send notices calculated both ways to each property owner.

Use of the Homestead Tax Option in other Municipalities

The Homestead Tax Option is currently being used by 14 cities, 16 towns, and 74 school districts.

For your information I have listed below the Homestead and Non-homestead tax rates in Binghamton, Buffalo, Niagara Falls, and Rochester.

 

Homestead and Non-homestead Tax Rates
Homestead Class Tax Rates Non-Homestead Class Tax Rates
Binghamton City 11.073 16.725
School 15.378 24.284
County 6.386 6.386
  Total 32.837 47.395
Buffalo City 10.620 21.160
School 6.840 14.090
County 7.430 7.430

 

Total 24.890 42.680
Niagara Falls City 10.330 26.100
School 12.780 32.640
County 7.830 7.830
  Total 30.940 66.550
Rochester City 5.545 14.162
School 10.634 27.946
County 11.580 11.580
Total 27.759 53.688

 

/amk
cc: Mayor Bernardi
Superintendent DiFlorio, Board of Education

_______________________________

DEPARTMENT OF ASSESSMENT

Memorandum    

To: Common Council

From: John C. Gamage

Date:  October 18, 1995

Re: Homestead Tax Option

Attached for your information and review are several tables which illustrate various aspects of the preliminary full value assessment roll relative to the Homestead Tax Option:

TABLE 1     Comparison of residential and commercial percent of the tax base

TABLE 2     Preliminary tax rate comparison

TABLE 3     Change in City/School taxes

TABLE 4     Change in County taxes

TABLE 5     Change in City/School/County taxes

TABLE 6     As requested at the committee meeting on September 7, this is a summary of Homestead and Non-Homestead tax rates in several cities.

Also attached to help illustrate how the Homestead Tax Option works, are 2 sets of Assessment Disclosure notices:

Set 1 is a homestead basis notice and a non-homestead basis notice for a house assessed at $70,000

Set 2 is a homestead basis notice and a non-homestead basis notice for a commercial property assessed at $329,500.

 

Table 1. Percent Tax Rate Comparison
  Current Roll Revaluation Roll
Residential 46.41% 54.50%
Commercial 39.80% 35.11%
 All Others 13.79% 10.39%

 

 

Table 2. Preliminary Tax Rate Comparison

  

Current Tax Rate
Reassessment Tax Rate Without Homestead Reassessment Tax Rate with Full Homestead

Homestead Non-Homestead Class Class

City $51.46 $4.65 $3.98 $5.49
School $139.94 $12.65 $10.91 $14.92
County $137.72 $12.44 $12.44 $12.44
Total $329.12 $29.74 $27.33 $32.85


 

Table 3.  Change in City/School Taxes

Residential Property Commercial Property
With Homestead Without Homestead With
Homestead
Without Homestead

> - $999

90

 

32

 

809

1,302

 -$500 to - $999

953

 

290

 

580

775

 -$200 to + $500

4,573

 

1,828

 

652

702

 -$200 to + $200

21,105

 

16,628

 

954

834

 +$200 to + $500

6,446

 

12,231

 

488

249

+$500 to + $999

393

 

2,477

 

310

156

 > + $999

16

 

90

 

495

270

Total

33,576

 

33,576

 

4,288

4,288


 

Table 4. Change in County Taxes
  Residential Property   Commercial Property
> - $999 9    949
 -$500 to - $999 105    782
 -$200 to - $500 1,134   868
 -$200 to +$200 21,798   1,119
 +$200 to $500 10,034   225
 +$500 to $999 479   132
 > + $999 17   213
 Total 33,576   4,288

 

 

Table 5.   Change in City/School/County Taxes
  Residential Property   Commercial Property
  With Homestead Without Homestead   With Homestead Without Homestead
> - $999 390 202  1,535 1,932
 -$500 to - $999 1,781 965   622 632
-$200 to - $500 4,040 2,531   427 411
-$200 to +$200 12,763 10,196   547 501
+$200 to $500 8,775 9,691    301 258
+$500 to $999 5,402 8,747    298 169
> + $999 425 1,244    558 385
Total 33,576 33,576  4,288 4,288

Table 6.   Comparison of Homestead Tax Rates in Selected Cities
  Buffalo Rochester Niagara Falls
Year  Homestead Non-Homestead Homestead Non-Homestead Homestead Non-Homestead
85-86 29.22 46.59 35.07 55.96
86-87 21.04 38.74 37.82 60.05
87-88 20.66 39.22 37.45 64.68
88-89 28.35 34.46 22.03 41.97 39.42 70.94
89-90 29.66 36.49 23.44 43.27 40.84 74.99
90-91 31.49 40.19 22.93 45.27 42.05 78.50
91-92 33.72 44.43 24.91 48.91 43.41 84.32
92-93 39.08 52.95 25.92 50.99 43.47 83.66
93-94 26.87 48.05 26.09 52.92 30.35 69.59
94-95 23.40 43.04 26.87 53.07 30.94 66.56
95-96 24.89 42.67

 

 

 

Table 7.   Comparison of Homestead Tax Rates in Selected Cities
           Buffalo         Rochester          Niagara Falls
Year  Homestead Non-Homestead Homestead Non-Homestead Homestead Non-Homestead
85-86   29.22 46.59  35.07 55.96
86-87     21.04 38.74 37.82 60.05
87-88     20.66 39.22 37.45 64.68
88-89  28.35 34.46  22.03 41.97  39.42 70.94
89-90  29.66 36.49  23.44 43.27  40.84 74.99
90-91  31.49 40.19  22.93 45.27  42.05 78.50
91-92  33.72 44.43 24.91 48.91  43.41 84.32
92-93  39.08 52.95  25.92 50.99  43.47 83.66
93-94  26.87 48.05 26.09 52.92 30.35 69.59
94-95  23.40 43.04  26.87 53.07 30.94 66.56
95-96  24.89 42.67  

Homestead tax option used - dual tax rates

City of Syracuse ** refer to the cover letter for general information

Onondaga county ** and informal meeting procedures

Assessment disclosure notice

For information only - this is not a tax bill

 

 

Owner Information: 311500210

Parcel Information: Single Family Residence

Front Feet:  50

Depth:  128 

Your parcel has been designated as homestead our property will have a preliminary assessment of $70,000 

As of January 1, 1996 which is 100 percent of full value.    

****your last year's assessment was $5,300

The tax amounts shown are estimates based on last year's budget and indicate how your taxes would be affected if your preliminary assessed value were in effect. It does not reflect future tax liability. Actual tax dollars to be paid in the future will depend upon changes in the budgets adopted by each jurisdiction, other property assessment changes, exemptions, state aid changes and reapportionments of county and school tax levies.

 

 

 

           
Your Prior Year's Taxable    Your Current Year's Preliminary Approximate Tax
Dollar Liability
Tax Jurisdiction Assessment Taxable
Assessment
Prior Year Current Year
County HMSTD  $5,300  $70,000 730 871
City HMSTD  $5,300  $70,000  273 278
School HMSTD  $5,300  $70,000 742  764
    Approximate Total Taxes:  1,745  1,913
    (Estimated Tax (Increase)* 168

 

The above figures compare your prior year's taxable assessed value to your current year preliminary taxable assessed value in each taxing jurisdiction. Taxable assessed value is your assessed value minus applicable exemptions. 

You should examine the tentative assessment roll regardless of this notice or discussions at assessment, in order to protect your tight to assessment review, you must file a formal written complaint with your board of assessment review on or before the date set by law.

 

 

This is not an estimate of taxes owed nor is it an advisement of a refund.

Homestead tax option used - dual tax rates

City of Syracuse ** refer to the cover letter for general information

Onondaga county ** and informal meeting procedures

Assessment disclosure notice

For information only - this is not a tax bill

 

Owner Information: 311500464

Parcel Information: Office Building

Front Feet:  72

Depth:  132

Your property will have a preliminary assessment of $329,500
as of January 1, 1996 which is 100 percent of full value.

Your last year's assessment was $35,000

The tax amounts shown are estimates based on last year's budget and indicate how your taxes would be affected if your preliminary assessed value were in effect. It does not reflect future tax liability. Actual tax dollars to be paid in the future will depend upon changes in the budgets adopted by each jurisdiction, other property assessment changes, exemptions, state aid changes and reapportionments of county and school tax levies

 


 

 Your Prior
Year's Taxable Assessment
Your Current Year's Preliminary Taxable Assessment Approximate Tax Dollar Liability
Tax Jurisdiction Prior Year Current Year
County Non-HMSTD  $35,000  $329,500  4,820  4,100
City Non-HMSTD  $35,000  $329,500  1,801  1,807
School Non-HMSTD  $35,000  $329,500  4,898  4,915
 Approximate Total Taxes:  11,519  10,822
  Estimated Tax (Decrease)* 697

 

The above figures compare your prior year's taxable assessed value to your current year preliminary taxable assessed value in each taxing jurisdiction. Taxable assessed value is your assessed value minus applicable exemptions.

You should examine the tentative assessment roll regardless of this notice or discussions at assessment, in order to protect your tight to assessment review, you must file a formal written complaint with your board of assessment review on or before the date set by law.

This is not an estimate of taxes owed nor is it an advisement of a refund.

Homestead tax option not used - uniform tax rates for all property

City of Syracuse ** refer to the cover letter for general information

Onondaga county ** and informal meeting procedures
assessment disclosure notice

For information only - this is not a tax bill

Owner Information: 311500464

Parcel Information: Office Building

Front Feet:  72

Depth:  132
 

 

Your last year's assessment was $35,000

The tax amounts shown are estimates based on last year's budget and indicate how your taxes would be affected if your preliminary assessed value were in effect. It does not reflect future tax liability. Actual tax dollars to be paid in the future will depend upon changes in the budgets adopted by each jurisdiction, other property assessment changes, exemptions, state aid changes and reapportionments of county and school tax levies.

 Your Prior
Year's Taxable Assessment
Your Current Year's Preliminary Taxable Assessment Approximate Tax Dollar Liability
Tax Jurisdiction Prior Year Current Year
County HMSTD $5,300 $70,000 730 871
City HMSTD $5,300 $70,000  273  325
School HMSTD $5,300 $70,000  742  866
 Approximate Total Taxes:  1,745  2,082
     Estimated Tax (Increase)* 337

  

The above figures compare your prior year's taxable assessed value to your current year preliminary taxable assessed value in each taxing jurisdiction. Taxable assessed value is your assessed value minus applicable exemptions.

You should examine the tentative assessment roll regardless of this notice or discussions at assessment, in order to protect your tight to assessment review, you must file a formal written complaint with your board of assessment review on or before the date set by law.

This is not an estimate of taxes owed nor is it an advisement of a refund.

 

 

Trustee Professor of Public Administration and Economics