Tax that hits home
Bipartisan bid targets ‘gentrify’ buyers
Here’s one thing that unites local pols across the political divide — a gentrification tax.
A bipartisan group of city lawmakers is pushing Albany to approve tweaks to state tax laws that would allow the city to hit new homebuyers with tax bills based on the actual market prices of their properties.
The coalition of 13 Republican and Democratic City Council members says taxes would not go up for existing owners.
New York City’s famously opaque property-tax system offers big breaks to new homebuyers by taxing them at assessed values that are often millions of dollars less than the market price.
For instance, a buyer who snapped up a Clinton Hill brownstone for $3 million in 2017 has a billable assessed value of only $24,000, leaving the lucky owner with a tax bill of just $4,297 a year.
Meanwhile, the owner of a relatively modest half-million-dollar Bergen Beach bungalow pays nearly an identical amount, despite being worth just one-sixth the brownstone’s market price.
The current system amounts to a giant giveaway for gentrifiers, Councilman Joe Borelli (R-SI) told The Post.
“People are just getting fed up with the loophole, and they’re demanding action,” Borelli said.
The bipartisan coalition includes Park Slope Democrat Brad Lander and Bay Ridge Democrat Justin Brannan.
They’re backing a resolution that calls on state lawmakers to change the tax law to require new city homebuyers to pay property taxes on the market rate instead of the heavily discounted assessed value.
The change would boost the Clinton Hill gentrifiers’ bill by $1,600 a year while keeping the Bergen Beach old-timer’s costs the same.
“Borelli’s plan to reset the tax cap whenever a new owner purchases a property would bring a small drop of fairness to a system that is just completely screwed and totally unfair,” Brannan said.
Borelli sent the proposed resolution to City Council Speaker Corey Johnson and state Assembly Speaker Carl Heastie earlier this month with a letter asking for the change. Heastie’s reps did not return calls seeking comment.
Johnson’s spokeswoman, Jennifer Fermino, said the speaker is awaiting the preliminary report from a property-tax-reform commission he and Mayor de Blasio convened in 2018.
“The Advisory Commission is looking at Real Property Tax Law 1805 as part of its review of our broken system,” Fermino added. “Any recommendations for changes will be part of the commission’s preliminary report. The speaker is looking forward to reviewing their recommendations when the report is ready.”
There’s no deadline for the initial tax-overhaul report, which has been reportedly near release since July.
A spokeswoman for Hizzoner also punted on Borelli’s plan, referring to the overdue tax study.
“The property-tax system is complex, and we appreciate Council Member Borelli’s interest in reforming the Real Property Tax Law,” said Marcy Miranda, press secretary for the city’s Department of Finance.