2023 New York Laws › RPT - Real Property Tax › Article 4 - Exemptions › Title 2 - Private Property › 421-P*2 - Exemption of Capital Improvements to Residential New Construction Involving the Creation of Accessory Dwelling Units.

* §  421-p.  Exemption  of  capital  improvements  to  residential new
construction involving the creation  of  accessory  dwelling  units.  1.
Residential   buildings   reconstructed,  altered,  improved,  or  newly
constructed in order  to  create  one  or  more  additional  residential
dwelling units on the same parcel as a pre-existing residential building
to  provide  independent  living  facilities  for  one  or  more persons
subsequent to the effective date of a local law  or  resolution  enacted
pursuant  to  this  section shall be exempt from taxation and special ad
valorem levies to  the  extent  provided  hereinafter.  After  a  public
hearing,  the  governing  board  of  a county, city, town or village may
adopt a local law and a school district, other than  a  school  district
subject  to  article  fifty-two  of  the  education  law,  may  adopt  a
resolution to grant the exemption authorized pursuant to this section. A
copy  of  such  local  law  or  resolution  shall  be  filed  with   the
commissioner  and the assessor of such county, city, town or village who
prepares the assessment roll on which the taxes of  such  county,  city,
town, village or school district are levied.
2.  (a)  Such  buildings shall be exempt for a period of five years to
the extent of one hundred per centum of the increase in  assessed  value
thereof attributable to such reconstruction, alteration, improvement, or
new  construction  for  such  additional  residential unit or units that
provide independent living facilities for one or more persons,  and  for
an additional period of five years subject to the following:
(i) The extent of such exemption shall be decreased by twenty-five per
centum  of the "exemption base" for each of the first three years during
such additional period and shall be  decreased  by  a  further  ten  per
centum  of  the  "exemption  base" during each of the final two years of
such additional period. The exemption shall expire at  the  end  of  the
extended  period. The "exemption base" shall be the increase in assessed
value as determined in the initial year of the term  of  the  exemption,
except as provided in subparagraph (ii) of this paragraph.
(ii)  In  any year in which a change in level of assessment of fifteen
percent or more is certified for a final assessment roll pursuant to the
rules of the commissioner, the exemption base shall be multiplied  by  a
fraction,  the  numerator  of which shall be the total assessed value of
the parcel on such final  assessment  roll  (after  accounting  for  any
physical  or  quantity  changes  to  the  parcel  since  the immediately
preceding assessment roll), and the denominator of which  shall  be  the
total  assessed  value  of the parcel on the immediately preceding final
assessment roll. The  result  shall  be  the  new  exemption  base.  The
exemption  shall  thereupon  be  recomputed to take into account the new
exemption base, notwithstanding the  fact  that  the  assessor  receives
certification of the change in level of assessment after the completion,
verification  and  filing of the final assessment roll. In the event the
assessor does not have custody of the roll when  such  certification  is
received,  the  assessor  shall  certify the recomputed exemption to the
local officers having custody and control of the roll,  and  such  local
officers  are  hereby  directed  and  authorized to enter the recomputed
exemption certified by the assessor on the roll. The assessor shall give
written notice of such recomputed exemption to the property  owner,  who
may,  if  such property owner believes that the exemption was recomputed
incorrectly, apply for a correction in  the  manner  provided  by  title
three  of  article  five  of this chapter for the correction of clerical
errors.
(iii) Such exemption shall be limited to two hundred thousand  dollars
in   increased  market  value  of  the  property  attributable  to  such
reconstruction, alteration, improvement, or  new  construction  and  any
increase  in market value greater than such amount shall not be eligible

for the exemption pursuant to this section. For  the  purposes  of  this
section,   the   market   value   of   the  reconstruction,  alteration,
improvement, or new construction as authorized  by  subdivision  one  of
this section shall be equal to the increased assessed value attributable
to  such  reconstruction,  alteration,  improvement, or new construction
divided by the class one ratio in a special assessing unit or  the  most
recently  established  state  equalization  rate or special equalization
rate in the remainder of the state, except where the state  equalization
rate or special equalization rate equals or exceeds ninety-five percent,
in  which  case  the  increase  in  assessed  value attributable to such
reconstruction, alteration, improvement, or new  construction  shall  be
deemed  to  equal  the  market value of such reconstruction, alteration,
improvement, or new construction.
(b)  No  such  exemption  shall   be   granted   for   reconstruction,
alterations, improvements, or new construction unless:
(i)  such reconstruction, alteration, improvement, or new construction
was commenced subsequent to the effective  date  of  the  local  law  or
resolution adopted pursuant to subdivision one of this section; and
(ii) the value of such reconstruction, alteration, improvement, or new
construction exceeds three thousand dollars; and
(iii)   such   reconstruction,   alteration,   improvement,   or   new
construction created one or more additional residential  dwelling  units
on  the  same parcel as the pre-existing residential building to provide
independent living facilities for one or more persons.
(c) For purposes of this section the terms reconstruction, alteration,
improvement, and new construction shall not include ordinary maintenance
and repairs.
3. Such exemption shall be granted only upon application by the  owner
of  such  building  on  a  form  prescribed  by  the  commissioner.  The
application shall be filed with the assessor of the city, town,  village
or  county having the power to assess property for taxation on or before
the appropriate taxable status date  of  such  city,  town,  village  or
county.
4.  If  satisfied  that  the  applicant  is  entitled  to an exemption
pursuant to this section, the assessor shall approve the application and
such building shall thereafter be exempt from taxation  and  special  ad
valorem  levies  as  herein provided commencing with the assessment roll
prepared on the  basis  of  the  taxable  status  date  referred  to  in
subdivision  three  of this section. The assessed value of any exemption
granted pursuant to this section shall be entered by the assessor on the
assessment roll with the  taxable  property,  with  the  amount  of  the
exemption shown in a separate column.
5. For the purposes of this section, a residential building shall mean
any   building  or  structure  designed  and  occupied  exclusively  for
residential purposes by not more than two families.
6. In the event that a building granted an exemption pursuant to  this
section  ceases  to be used primarily for residential purposes, or title
thereto is transferred to other than the heirs or  distributees  of  the
owner, the exemption granted pursuant to this section shall cease.
7.  (a)  A  county,  city,  town  or village may, by its local law, or
school district, by its resolution:
(i) reduce the per centum of exemption otherwise allowed  pursuant  to
this section; and
(ii)   limit   eligibility   for  the  exemption  to  those  forms  of
reconstruction, alterations, improvements, or new  construction  as  are
prescribed in such local law or resolution.
(b)  No such local law or resolution shall repeal an exemption granted
pursuant to this section until the expiration of the  period  for  which
such exemption was granted.
* NB There are two § 421-p's