Opinion ID: 779366
Heading Depth: 2
Heading Rank: 2

Heading: ORPS and Taxation of Railroad Property in New York

Text: 10 ORPS is an executive department of the government of the State of New York charged by statute with the administration of various matters pertaining to real property taxation in New York. See N.Y. Real Prop. Tax § 202. Although local property taxes in New York are imposed by individual assessing units, 6 ORPS is empowered with the general supervision of the function of assessing throughout the state. Id. § 202(e). ORPS is the successor to the SBEA, which was formed in 1949 as a temporary commission in order to deal with a legislative concern that the then existing equalization rates had gradually been rendered inaccurate by increases in property values during economic inflation during the aftermath of World War II. State Bd. of Equalization and Assessment v. Kerwick, 52 N.Y.2d 557, 572, 439 N.Y.S.2d 311, 421 N.E.2d 803 (1981). The New York legislature reconstituted the SBEA as a permanent agency in 1960. Town of Smithtown v. Moore, 11 N.Y.2d 238, 241, 228 N.Y.S.2d 657, 183 N.E.2d 66 (1962). 11 Under New York law, railroad property receives a partial tax exemption based on a railroad ceiling. A railroad ceiling is the maximum value on which a tax district may levy real property taxes on railroad real property; railroad real property is exempt from ad valorem taxation imposed by assessing units to the extent that its assessed value exceeds the railroad ceiling. See N.Y. Real Prop. Tax § 489-p. Among its many duties, ORPS is responsible for determining the ceilings. See id. §§ 200, 202(m). The following procedure is used to determine railroad ceilings for interstate railroad companies. First, ORPS determines the average railway revenue and expenses. Id. §§ 489-ee(1)(a), 489-ff. Using those figures, ORPS determines the ratio of railroad revenues to railroad expenses (the ratio). Id. §§ 489-ee(1)(b), 489-gg. The amount of the ratio is then used to determine the economic factor, which is calculated on the basis of a sliding scale. 7 Id. §§ 489-ee(1)(c), 489-hh. Next, ORPS determines the local reproduction cost. 8 Id. §§ 489-ee(1)(d), 489-ii. Once those figures have been determined, ORPS multiplies the local reproduction cost by the economic factor. Id. §§ 489-ee(2). The resulting figure is then multiplied by the state equalization rate, which is the percentage of full value at which taxable real property in a county, city, town or village is assessed as determined by the state board. 9 Id. § 102(19); see also id. §§ 489-ee(3), 489-jj. The resulting figure is the railroad ceiling for the assessing district.