FIX THIS MESS NOW!
POLITICIANS HAVE complained for years that New York City’s system of taxing property is unfair and hurts lowerincome homeowners and renters.
On Tuesday, an eclectic coalition of civil justice leaders, homeowners and landlords did something about it, filing a lawsuit charging that the system is also racially biased.
Tax Equity Now NY filed suit in Manhattan Supreme Court, backed up by mountains of data collected by former city Finance Commissioner Martha Stark mapping out a disparity that hurts certain homeowners and renters.
“Despite decades of criticism and widespread agreement that the current system does not work, very little has been done to change the system,” Stark said. “Today that all changes.”
The suit includes an unusual mix of supporters, among them homeowners from Queens and Brooklyn; the Rent Stabilization Association, a major landlord group; megadevelopers like Related Companies and Two Trees; the good-government Citizens Budget Commission, and civil rights organizations like the New York NAACP and the Black Institute.
In 94 pages, Tax Equity Now NY charges the city’s system violates the state and U.S. Constitutions by treating different property owners differently. And it alleges the system’s racial bias also violates the federal Fair Housing Act.
Data show homeowners in upscale majority-white neighborhoods like Park Slope, Brooklyn, and Brooklyn Heights paying less than owners in predominantly minority-group neighborhoods like East New York, Brooklyn, and South Jamaica, Queens.
Owners of large apartment buildings also pay the highest effective tax rate based on the value of their buildings, and pass the burden on to their tenants.
The suit asks a judge to order the city and state to remedy these flaws by changing the way homes, co-ops, condos and rental buildings are assessed and taxed.
Complaints about the inequities have been around for years, but politicians — reluctant to adopt changes that would drive up certain property tax bills while lowering others — have left the formula
untouched.
Mayor de Blasio agreed Monday that the system is wrong and should be changed, but insisted that he couldn’t touch it until after he’s reelected.
The suit was announced on the steps of City Hall by Jonathan Lippman, the former state chief judge and a lawyer at Latham & Watkins, the firm that drafted the suit. Among those appearing at the announcement was Arthur Russell of Queens, who has assailed the “blatant abuse” in the system.
Lippman noted that back in 1975 in a case known as Hellerstein, all of the state’s municipalities were ordered to tax all properties based on their full market value.
But the city got Albany to change the law, implementing a convoluted system that allowed for taxation based on a fraction of full market value, and capping how much assessments could rise at no more than 20% in five years.
These restrictions have had the effect of keeping taxes low for high-value property and shifting the burden to lower-value properties in working- and middle class New York City neighborhoods.