Bill Text: NY S04098 | 2023-2024 | General Assembly | Amended
Bill Title: Authorizes cities and towns, except a city with a population of one million or more, to establish community preservation funds; authorizes such cities and towns to impose a real estate transfer tax with revenues to be deposited in such funds; makes related provisions.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced) 2024-01-03 - REFERRED TO LOCAL GOVERNMENT [S04098 Detail]
Download: New_York-2023-S04098-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 4098--A 2023-2024 Regular Sessions IN SENATE February 3, 2023 ___________ Introduced by Sen. RYAN -- read twice and ordered printed, and when printed to be committed to the Committee on Local Government -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the general municipal law, in relation to authorizing cities and towns, except a city with a population of one million or more, to establish community preservation funds; and to amend the tax law, in relation to authorizing cities and towns, except a city with a population of one million or more, to impose a real estate transfer tax with revenues therefrom to be deposited in such funds The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. The general municipal law is amended by adding a new 2 section 6-w to read as follows: 3 § 6-w. Community preservation funds. 1. As used in this section, the 4 following words and terms shall have the following meanings: 5 (a) "Community preservation" shall mean and include any of the 6 purposes outlined in subdivision four of this section. 7 (b) "Board" means the advisory board required pursuant to subdivision 8 five of this section. 9 (c) "City or town" means a city, except a city with a population of 10 one million or more, or a town. 11 (d) "Governing body" means a city council or town board. 12 (e) "Fund" means the community preservation fund created pursuant to 13 subdivision two of this section. 14 (f) "Water quality improvement project" means: (1) any project eligi- 15 ble for state funding under the clean water infrastructure fund of two 16 thousand seventeen, pursuant to part T of chapter fifty-seven of the 17 laws of two thousand seventeen or (2) any project eligible for state 18 funding as a safe drinking water project or clean water project pursuant EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD05666-03-3S. 4098--A 2 1 to title two or title three of article fifty-six of the environmental 2 conservation law. 3 2. The governing body of any city or town is authorized to establish 4 by local law a community preservation fund pursuant to the provisions of 5 this section. Deposits into the fund may include revenues of the local 6 government from whatever source and shall include, at a minimum, all 7 revenues from a tax imposed upon the transfer of real property interests 8 in such city or town pursuant to subdivision one of section one thousand 9 five hundred seventy-six of the tax law. The fund shall also be author- 10 ized to accept gifts of any such interests in land or of funds. Interest 11 accrued by monies deposited into the fund shall be credited to the fund. 12 In no event shall monies deposited in the fund be transferred to any 13 other account. Nothing contained in this section shall be construed to 14 prevent the financing in whole or in part, pursuant to the local finance 15 law, of any acquisition authorized pursuant to this section. Monies from 16 the fund may be utilized to repay any indebtedness or obligations 17 incurred pursuant to the local finance law consistent with effectuating 18 the purposes of this section. 19 3. The purposes of the fund shall be exclusively, (a) to implement a 20 plan for the preservation of community character as required by this 21 section, (b) to acquire interests or rights in real property for the 22 preservation of community character within the designated city or town 23 including villages therein in accordance with such plan and in cooper- 24 ation with willing sellers, (c) to establish a bank pursuant to a trans- 25 fer of development rights program as permitted by law, (d) to provide a 26 management and stewardship program for such interests and rights 27 consistent with subdivision nine of this section and in accordance with 28 such plan designed to preserve community character; provided that not 29 more than ten (10) percent of the fund shall be utilized for the manage- 30 ment and stewardship program, and (e) to implement water quality 31 improvement projects in accordance with a plan to preserve community 32 character. If the implementation of the community preservation project 33 plan, adopted by a governing body, as provided in subdivision six of 34 this section, has been completed, and funds are no longer needed for the 35 purposes outlined in this subdivision, then any remaining monies in the 36 fund shall be applied to reduce any bonded indebtedness or obligations 37 incurred to effectuate the purposes of this section. Preliminary and 38 incidental costs in connection with the acquisition of interests or 39 rights in real property, pursuant to this subdivision, shall be deemed 40 part of the cost of the acquisition for which they were incurred. Such 41 expenditures may include any administrative or other expenditures 42 directly arising therefrom. No expenditure shall be charged to the fund, 43 unless authorized by law. A full accounting of such costs for each 44 acquisition of land shall be provided by the governing body. 45 4. Preservation of community character shall involve one or more of 46 the following: (a) establishment of parks, nature preserves, or recre- 47 ation areas; (b) preservation of open space, including agricultural 48 lands provided, however, that farm buildings and structures used for the 49 production and marketing of farm products produced on such agricultural 50 lands shall be permitted; (c) preservation of lands of exceptional 51 scenic value; (d) preservation of fresh and saltwater marshes or other 52 wetlands; (e) preservation of aquifer recharge areas; (f) preservation 53 of undeveloped beach lands or shoreline including those at significant 54 risk of coastal flooding due to projected sea level rise and future 55 storms; (g) establishment of wildlife refuges for the purpose of main- 56 taining native animal species diversity, including the protection ofS. 4098--A 3 1 habitat essential to the recovery of rare, threatened or endangered 2 species; (h) preservation of pine barrens consisting of such biota as 3 pitch pine, and scrub oak; (i) preservation of unique or threatened 4 ecological areas; (j) preservation of rivers and river areas in a 5 natural, free-flowing condition; (k) preservation of forested land; (l) 6 preservation of public access to lands for public use including stream 7 rights and waterways; (m) preservation of historic places and properties 8 listed on the New York state register of historic places and/or 9 protected under a municipal historic preservation ordinance or law; (n) 10 preservation of lands necessary to protect fisheries and water dependent 11 uses essential to maintain and enhance maritime heritage; and (o) under- 12 taking any of the aforementioned in furtherance of the establishment of 13 a greenbelt. Preservation of community character shall also include the 14 protection and improvement of the quality of all water resources. 15 5. The governing body of any city or town which has established a 16 community preservation fund shall create an advisory board to review and 17 make recommendations on proposed acquisitions of interests in real prop- 18 erty or water quality improvement projects using monies from the fund. 19 Such board shall consist of five or seven legal residents of the munici- 20 pality who shall serve without compensation. No member of the local 21 legislative body shall serve on the board. A majority of the members of 22 the board shall have demonstrated experience with conservation and land 23 preservation activities or water quality improvement activities. The 24 board shall act in an advisory capacity to the governing body. 25 6. The governing body of any city or town which has established a 26 community preservation fund shall, by local law, adopt a community pres- 27 ervation project plan. This plan shall list every project which the city 28 or town plans to undertake pursuant to the community preservation fund. 29 It shall include every parcel which is necessary to be acquired in the 30 city or town in order to protect community character. Such plan shall 31 provide for a detailed evaluation of all available land use alternatives 32 to protect community character, including but not limited to: (a) fee 33 simple acquisition, (b) zoning regulations, including density 34 reductions, cluster development, and site plan and design requirements, 35 (c) transfer of development rights, (d) the purchase of development 36 rights, and (e) scenic and conservation easements. Said evaluation shall 37 be as specific as practicable as to each parcel selected for inclusion 38 in the plan. The plan shall establish the priorities for preservation. 39 Said plan shall also list every water quality improvement project which 40 the city or town plans to undertake pursuant to the community preserva- 41 tion fund and shall state how such project would improve existing water 42 quality. Projects which have as their purpose the accommodation of new 43 growth as opposed to the remediation of water quality shall not qualify 44 for funding under this section. Funds from the community preservation 45 fund may only be expended for projects which have been included in said 46 plan. The plan shall be updated not less than once every five years and 47 shall be completed at least sixty (60) days before the submission of the 48 mandatory referendum required by section fifteen hundred seventy-six of 49 the tax law. As part of, or in addition, to said community preservation 50 fund project plan, each governing body may also adopt a management and 51 stewardship plan for interests or rights in real property acquired 52 pursuant to this section. No monies from the fund shall be expended for 53 management and stewardship, except as approved in said plan. Said plan 54 may provide management and stewardship projects for up to a three year 55 period and shall provide a description and estimated cost for each 56 project. Said plan shall be approved and adopted by local law and may beS. 4098--A 4 1 updated from time to time at the discretion of the local governing body. 2 Only management and stewardship projects permitted pursuant to subdivi- 3 sion nine of this section shall be eligible to be included in the plan. 4 7. The governing body of any city or town which has established a 5 community preservation fund pursuant to this section shall consider 6 establishing a transfer of development rights program to protect commu- 7 nity character consistent with state law. If at any time during the life 8 of the community preservation fund a transfer of development rights 9 program is established, the city or town may utilize monies from the 10 community preservation fund in order to create and fund a central bank 11 of the transfer of development rights program. If at any time during the 12 life of the community preservation fund, a transfer of development 13 rights program is repealed by the city or town, all monies from the 14 central bank shall be returned to the community preservation fund. 15 8. No interests or rights in real property shall be acquired pursuant 16 to this section until a public hearing is held as required by section 17 two hundred forty-seven of this chapter; provided, however, that nothing 18 in this section shall prevent the governing body from entering into a 19 conditional purchase agreement before a public hearing is held. Any 20 resolution of a governing body approving an acquisition of land pursuant 21 to this section, shall find that acquisition was the best alternative 22 for the protection of community character of all the reasonable alterna- 23 tives available to the city or town. 24 9. Lands acquired pursuant to this section shall be administered and 25 managed in a manner which (a) allows public use and enjoyment in a 26 manner compatible with the natural, scenic, historic and open space 27 character of such lands; (b) preserves the native biological diversity 28 of such lands; (c) with regard to open spaces, limits improvements to 29 enhancing access for passive use of such lands such as nature trails, 30 boardwalks, bicycle paths, and peripheral parking areas provided that 31 such improvements do not degrade the ecological value of the land or 32 threaten essential wildlife habitat; and (d) preserves cultural property 33 consistent with accepted standards for historic preservation. In 34 furthering the purposes of this section, the city or town may enter into 35 agreements with conservation organizations formed under the not-for-pro- 36 fit corporation law and engaged in land trust activities to manage 37 lands, including less than fee interests acquired pursuant to the 38 provisions of this section, provided that any such agreement shall 39 contain a provision that such corporation shall keep the lands accessi- 40 ble to the public unless the governing body finds that public accessi- 41 bility would be detrimental to the lands or any natural resources asso- 42 ciated therewith. Except for interests or rights in real property 43 acquired for historic preservation purposes, management and stewardship 44 projects shall be only expended for (1) projects which promote the 45 protection or enhancement of the natural, scenic, and open space charac- 46 ter for which the interests or rights in real property were acquired, or 47 (2) accessory uses related to the purpose for which the interests or 48 rights in real property were acquired consistent with this subdivision, 49 or (3) restoration of acquired real property to its natural state 50 including the demolition of existing buildings and structures. In the 51 case of interests or rights in real property acquired for historic pres- 52 ervation purposes, funds may be expended only for the restoration and 53 rehabilitation of buildings and structures consistent with accepted 54 state and federal standards for historic preservation. Expenses related 55 to the customary operation and maintenance of acquired interests or 56 rights in real property shall not be permitted from the fund. AnyS. 4098--A 5 1 expenditure from the fund for a purpose other than that permitted, here- 2 in, shall be deemed to be prohibited. 3 10. Rights or interests in real property acquired with monies from 4 such fund shall not be sold, leased, exchanged, donated, or otherwise 5 disposed of or used for other than the purposes permitted by this 6 section without the express authority of an act of the legislature, 7 which shall provide for the substitution of other lands of equal envi- 8 ronmental value and fair market value and reasonably equivalent useful- 9 ness and location to those to be discontinued, sold or disposed of, and 10 such other requirements as shall be approved by the legislature. Nothing 11 in this section shall preclude a city or town, by local law, from estab- 12 lishing additional restrictions to the alienation of lands acquired 13 pursuant to this section. This subdivision shall not apply to the sale 14 of development rights by a city or town acquired pursuant to this 15 section, where said sale is made by a central bank created by a city or 16 town, pursuant to a transfer of development rights program established 17 by a city or town, provided, however (a) that the lands from which said 18 development rights were acquired shall remain preserved in perpetuity by 19 a permanent conservation easement or other instrument that similarly 20 preserves the community character referenced in subdivision four of this 21 section, and (b) the proceeds from such sale shall be deposited in the 22 community preservation fund. 23 11. Notwithstanding any provision of law to the contrary, cities or 24 towns may enter into inter-municipal agreements pursuant to article 25 five-G of this chapter for the following purposes: (a) to jointly 26 acquire interests or rights in real property, consistent with the 27 purposes of this section, where the acquisition of such interests or 28 rights promotes a regional public benefit for two or more cities or 29 towns pursuant to a regional plan, (b) to establish an office or depart- 30 ment to render legal opinions and interpretations to facilitate the 31 efficient and consistent administration of each fund created under this 32 section, (c) to provide for an independent financial audit of each 33 city's or town's fund, and (d) to hire employees necessary to implement 34 the provisions of this section. 35 12. Each city or town which has established a community preservation 36 fund shall annually commission an independent audit of the fund. The 37 audit shall be conducted by an independent certified public accountant 38 or an independent public accountant. Said audit shall be performed by a 39 certified public accountant or an independent public accountant other 40 than the one that performs the general audit of each city's or town's 41 finances. Such audit shall be an examination of the fund and shall 42 determine whether the fund has been administered consistent with the 43 provisions of this section and all other applicable provisions of state 44 law. Said audit shall be initiated within sixty days of the close of the 45 fiscal year of each city or town and shall be completed within one 46 hundred twenty days of the close of the fiscal year. A copy of the audit 47 shall be submitted annually to the state comptroller and the city or 48 town clerk. A copy of the audit shall be made available to the public 49 within thirty days of its completion. A notice of the completion of the 50 audit shall be published in the official newspaper of the city or town 51 and posted on the official sign board of the city or town within ten 52 days of its filing with the town clerk. Said audit and notice shall 53 also be posted on the internet site for the city or town. The cost of 54 the audit may be a charge to the fund. 55 13. The cost of employees and independent contractors to implement the 56 provisions of this section may only be paid for by the fund where theS. 4098--A 6 1 duties and responsibilities of said employees and independent contrac- 2 tors are directly dedicated to implementing the provisions of this 3 section. Where such employees and independent contractors are not exclu- 4 sively dedicated to implementing the provisions of this section, no more 5 than the cost of the actual time expended directly dedicated to imple- 6 menting the provisions of this section may be charged. Such costs shall 7 be expressly identified in the city or town budget and any plan adopted 8 pursuant to this section before funds for such costs may be expended. In 9 addition, such costs must be documented by a time accounting system, 10 subject to audit. Costs relating to the activities of elected officials 11 implementing the purposes of this section may not be a charge to the 12 fund. 13 § 2. The tax law is amended by adding a new article 33-C to read as 14 follows: 15 ARTICLE 33-C 16 TAX ON REAL ESTATE TRANSFERS IN CITIES OR TOWNS 17 Section 1575. Definitions. 18 1576. Imposition of tax. 19 1577. Payment of tax. 20 1578. Liability for tax. 21 1579. Exemptions. 22 1580. Credit. 23 1581. Cooperative housing corporation transfers. 24 1582. Designation of agents. 25 1583. Liability of recording officer. 26 1584. Deposit and disposition of revenue. 27 1585. Judicial review. 28 1586. Apportionment. 29 1587. Miscellaneous. 30 1588. Returns to be secret. 31 § 1575. Definitions. When used in this article, unless otherwise 32 expressly stated, the following words and terms shall have the following 33 meanings: 34 1. "Person" means an individual, partnership, limited liability compa- 35 ny, society, association, joint stock company, corporation, estate, 36 receiver, trustee, assignee, referee or any other person acting in a 37 fiduciary or representative capacity, whether appointed by a court or 38 otherwise, any combination of individuals, and any other form of unin- 39 corporated enterprise owned or conducted by two or more persons. 40 2. "Controlling interest" means (a) in the case of a corporation, 41 either fifty percent or more of the total combined voting power of all 42 classes of stock of such corporation, or fifty percent or more of the 43 capital, profits or beneficial interest in such voting stock of such 44 corporation, and (b) in the case of a partnership, association, trust or 45 other entity, fifty percent or more of the capital, profits or benefi- 46 cial interest in such partnership, association, trust or other entity. 47 3. "Real property" means every estate or right, legal or equitable, 48 present or future, vested or contingent, in lands, tenements or heredi- 49 taments, including buildings, structures and other improvements thereon, 50 which are located in whole or in part within any city or town. It shall 51 not include rights to sepulture. 52 4. "Consideration" means the price actually paid or required to be 53 paid for the real property or interest therein, including payment for an 54 option or contract to purchase real property, whether or not expressed 55 in the deed and whether paid or required to be paid by money, property, 56 or any other thing of value. It shall include the cancellation orS. 4098--A 7 1 discharge of an indebtedness or obligation. It shall also include the 2 amount of any mortgage, purchase money mortgage, lien or other encum- 3 brance, whether or not the underlying indebtedness is assumed or taken 4 subject to. 5 (a) In the case of a creation of a leasehold interest or the granting 6 of an option with use and occupancy of real property, consideration 7 shall include, but not be limited to, the value of the rental and other 8 payments attributable to the use and occupancy of the real property or 9 interest therein, the value of any amount paid for an option to purchase 10 or renew and the value of rental or other payments attributable to the 11 exercise of any option to renew. 12 (b) In the case of a creation of a subleasehold interest, consider- 13 ation shall include, but not be limited to, the value of the sublease 14 rental payments attributable to the use and occupancy of the real prop- 15 erty, the value of any amount paid for an option to renew and the value 16 of rental or other payments attributable to the exercise of any option 17 to renew less the value of the remaining prime lease rental payments 18 required to be made. 19 (c) In the case of a controlling interest in any entity that owns real 20 property, consideration shall mean the fair market value of the real 21 property or interest therein, apportioned based on the percentage of the 22 ownership interest transferred or acquired in the entity. 23 (d) In the case of an assignment or surrender of a leasehold interest 24 or the assignment or surrender of an option or contract to purchase real 25 property, consideration shall not include the value of the remaining 26 rental payments required to be made pursuant to the terms of such lease 27 or the amount to be paid for the real property pursuant to the terms of 28 the option or contract being assigned or surrendered. 29 (e) In the case of (1) the original conveyance of shares of stock in a 30 cooperative housing corporation in connection with the grant or transfer 31 of a proprietary leasehold by the cooperative corporation or cooperative 32 plan sponsor, and (2) the subsequent conveyance by the owner thereof of 33 such stock in a cooperative housing corporation in connection with the 34 grant or transfer of a proprietary leasehold for a cooperative unit 35 other than an individual residential unit, consideration shall include a 36 proportionate share of the unpaid principal of any mortgage on the real 37 property of the cooperative housing corporation comprising the cooper- 38 ative dwelling or dwellings. Such share shall be determined by multiply- 39 ing the total unpaid principal of the mortgage by a fraction, the numer- 40 ator of which shall be the number of shares of stock being conveyed in 41 the cooperative housing corporation in connection with the grant or 42 transfer of a proprietary leasehold and the denominator of which shall 43 be the total number of shares of stock in the cooperative housing corpo- 44 ration. 45 5. "Conveyance" means the transfer or transfers of any interest in 46 real property by any method, including but not limited to, sale, 47 exchange, assignment, surrender, mortgage foreclosure, transfer in lieu 48 of foreclosure, option, trust indenture, taking by eminent domain, 49 conveyance upon liquidation or by a receiver, or transfer or acquisition 50 of a controlling interest in any entity with an interest in real proper- 51 ty. Transfer of an interest in real property shall include the creation 52 of a leasehold or sublease only where (a) the sum of the term of the 53 lease or sublease and any options for renewal exceeds forty-nine years, 54 (b) substantial capital improvements are or may be made by or for the 55 benefit of the lessee or sublessee, and (c) the lease or sublease is for 56 substantially all of the premises constituting the real property.S. 4098--A 8 1 Notwithstanding the foregoing, conveyance of real property shall not 2 include a conveyance made pursuant to devise, bequest or inheritance; 3 the creation, modification, extension, spreading, severance, consol- 4 idation, assignment, transfer, release or satisfaction of a mortgage; a 5 mortgage subordination agreement, a mortgage severance agreement, an 6 instrument given to perfect or correct a recorded mortgage; or a release 7 of lien of tax pursuant to this chapter or the internal revenue code. 8 6. "Interest in the real property" includes title in fee, a leasehold 9 interest, a beneficial interest, an encumbrance, development rights, air 10 space and air rights, or any other interest with the right to use or 11 occupancy of real property or the right to receive rents, profits or 12 other income derived from real property. It shall also include an option 13 or contract to purchase real property. It shall not include a right of 14 first refusal to purchase real property. 15 7. "Grantor" means the person making the conveyance of real property 16 or interest therein. Where the conveyance consists of a transfer or an 17 acquisition of a controlling interest in an entity with an interest in 18 real property, "grantor" means the entity with an interest in real prop- 19 erty or a shareholder or partner transferring stock or partnership 20 interest, respectively. 21 8. "Grantee" means the person who obtains real property or interest 22 therein as a result of a conveyance. 23 9. "Fund" means a community preservation fund created pursuant to 24 section six-w of the general municipal law. 25 10. "Recording officer" means the county clerk. 26 11. "City or town" means a city or town, except a city of one million 27 or more. 28 12. "Treasurer" means the county treasurer. 29 § 1576. Imposition of tax. 1. Notwithstanding any other provisions of 30 law to the contrary, any city or town, acting through its local govern- 31 ing body, is hereby authorized and empowered to adopt a local law impos- 32 ing in such city or town a tax on each conveyance of real property or 33 interest therein where the consideration exceeds five hundred dollars, 34 at a rate of up to two percent of the consideration for such conveyance. 35 Provided, however, any such local law imposing, repealing or reimposing 36 such tax shall be subject to a mandatory referendum pursuant to section 37 twenty-three of the municipal home rule law. Such local law shall only 38 be submitted for the approval of the electors at a general election. 39 Notwithstanding the foregoing, prior to adoption of such local law, the 40 city or town must establish a community preservation fund pursuant to 41 section six-w of the general municipal law. Revenues from such tax shall 42 be deposited in such fund and may be used solely for the purposes of 43 such fund. Such local law shall apply to any conveyance occurring on or 44 after the first day of a month to be designated by such local governing 45 body, which is not less than sixty days after the enactment of such 46 local law, but shall not apply to conveyances made on or after such date 47 pursuant to binding written contracts entered into prior to such date, 48 provided that the date of execution of such contract is confirmed by 49 independent evidence such as the recording of the contract, payment of a 50 deposit or other facts and circumstances as determined by the treasurer. 51 2. Notwithstanding any other provisions of law to the contrary, in 52 addition to the tax authorized by subdivision one of this section, any 53 city or town, acting through its governing body, is hereby authorized 54 and empowered to adopt a local law imposing in such city or town a 55 supplemental tax on each conveyance of real property or interest therein 56 where the consideration exceeds five hundred dollars, at the rate of upS. 4098--A 9 1 to one half of one percent of the consideration for such conveyance. 2 Provided, however, any such local law imposing, repealing or reimposing 3 such supplemental tax shall be subject to a mandatory referendum pursu- 4 ant to section twenty-three of the municipal home rule law. Revenues 5 from such supplemental tax shall be deposited in such community housing 6 fund and may be used solely for the purposes of such community housing 7 fund. Such local law shall apply to any conveyance occurring on or after 8 the first day of a month to be designated by the governing board, which 9 is not less than sixty days after the enactment of such local law, but 10 shall not apply to conveyances made on or after such date pursuant to 11 binding written contracts entered into prior to such date, provided that 12 the date of execution of such contract is confirmed by independent 13 evidence such as the recording of the contract, payment of a deposit or 14 other facts and circumstances as determined by the treasurer. Any tax 15 imposed pursuant to this subdivision shall be administered and collected 16 in a like manner as the tax imposed by subdivision one of this section. 17 § 1577. Payment of tax. 1. The real estate transfer tax imposed pursu- 18 ant to this article shall be paid to the treasurer or the recording 19 officer acting as the agent of the treasurer upon designation as such 20 agent by the treasurer. Such tax shall be paid at the same time as the 21 real estate transfer tax imposed by article thirty-one of this chapter 22 is required to be paid. Such treasurer or recording officer shall 23 endorse upon each deed or instrument effecting a conveyance a receipt 24 for the amount of the tax so paid. 25 2. A return shall be required to be filed with such treasurer or 26 recording officer for purposes of the real estate transfer tax imposed 27 pursuant to this article at the same time as a return is required to be 28 filed for purposes of the real estate transfer tax imposed by article 29 thirty-one of this chapter. The treasurer shall prescribe the form of 30 return, the information which it shall contain, and the documentation 31 that shall accompany the return. Said form shall be identical to the 32 real estate transfer tax return required to be filed pursuant to section 33 fourteen hundred nine of this chapter, except that the treasurer shall 34 adapt said form to reflect the provisions in this chapter that are 35 inconsistent, different, or in addition to the provisions of article 36 thirty-one of this chapter. The real estate transfer tax returns 37 required to be filed pursuant to this section shall be preserved for 38 three years and thereafter until such treasurer or recording officer 39 orders them to be destroyed. 40 3. The recording officer shall not record an instrument effecting a 41 conveyance unless the return required by this section has been filed and 42 the tax imposed pursuant to this article shall have been paid as 43 required in this section. 44 § 1578. Liability for tax. 1. The real estate transfer tax shall be 45 paid by the grantee. If the grantee has failed to pay the tax imposed 46 pursuant to this article or if the grantee is exempt from such tax, the 47 grantor shall have the duty to pay the tax. Where the grantor has the 48 duty to pay the tax because the grantee has failed to pay the tax, such 49 tax shall be the joint and several liability of the grantee and the 50 grantor. 51 2. For the purpose of the proper administration of this article and to 52 prevent evasion of the tax hereby imposed, it shall be presumed that all 53 conveyances are taxable. Where the consideration includes property other 54 than money, it shall be presumed that the consideration is the fair 55 market value of the real property or interest therein. These presump- 56 tions shall prevail until the contrary is proven, and the burden ofS. 4098--A 10 1 proving the contrary shall be on the person liable for payment of the 2 tax. 3 § 1579. Exemptions. 1. The following shall be exempt from the payment 4 of the real estate transfer tax: (a) the state of New York, or any of 5 its agencies, instrumentalities, political subdivisions, or public 6 corporations (including a public corporation created pursuant to an 7 agreement or compact with another state or Dominion of Canada); and 8 (b) the United Nations, the United States of America or any of its 9 agencies or instrumentalities. 10 2. The tax shall not apply to any of the following conveyances: (a) 11 conveyances to the United Nations, the United States of America, the 12 state of New York, or any of their instrumentalities, agencies or poli- 13 tical subdivisions (or any public corporation, including a public corpo- 14 ration created pursuant to agreement or compact with another state or 15 the Dominion of Canada); (b) conveyances which are or were used to 16 secure a debt or other obligation; (c) conveyances which, without addi- 17 tional consideration, confirm, correct, modify or supplement a deed 18 previously recorded; (d) conveyances of real property without consider- 19 ation and otherwise than in connection with a sale, including deeds 20 conveying realty as bona fide gifts; (e) conveyances given in connection 21 with a tax sale; (f) conveyances to effectuate a mere change of identity 22 or form of ownership or organization where there is no change in benefi- 23 cial ownership, other than conveyances to a cooperative housing corpo- 24 ration of the real property comprising the cooperative dwelling or 25 dwellings; (g) conveyances which consist of a deed of partition; (h) 26 conveyances given pursuant to the federal bankruptcy act; (i) conveyanc- 27 es of real property which consist of the execution of a contract to sell 28 real property without the use or occupancy of such property or the 29 granting of an option to purchase real property without the use or occu- 30 pancy of such property; (j) conveyances of real property, where the 31 entire parcel of real property to be conveyed is the subject of one or 32 more of the following development restrictions: (1) agricultural, 33 conservation, scenic, or an open space easement, (2) covenants or 34 restrictions prohibiting development, (3) a purchase of development 35 rights agreement, (4) a transfer of development rights agreement, where 36 the property being conveyed has had its development rights removed, (5) 37 said real property is subject to the development restriction of an agri- 38 cultural district or individual commitment, pursuant to article twenty- 39 five-AA of the agriculture and markets law, (6) real property subject to 40 any locally adopted land preservation agreement, provided said exemption 41 is included in the local law imposing the tax authorized by this arti- 42 cle; (k) conveyances of real property, where the property is viable 43 agricultural land as defined in subdivision seven of section three 44 hundred one of the agriculture and markets law and the entire property 45 to be conveyed is to be made subject to one of the development 46 restrictions provided for in subparagraph two of paragraph (j) of this 47 subdivision provided that said development restriction precludes the 48 conversion of the property to a non-agricultural use for at least three 49 years from the date of transfer, and said development restriction is 50 evidenced by an easement, agreement, or other suitable instrument which 51 is to be conveyed to the city or town simultaneously with the conveyance 52 of the real property; or (l) conveyances of real property for open 53 space, parks, community housing, or historic preservation purposes to 54 any not-for-profit tax exempt corporation operated for conservation, 55 environmental, community housing or historic preservation purposes.S. 4098--A 11 1 3. The governing body of a city or town, by local law may establish a 2 community housing exemption. Such exemption may not exceed an amount 3 equal to the residential median sale price of the county in which the 4 city or town is located, as determined by the office of real property 5 services within the department of taxation and finance. Such exemption 6 shall be allowed on the consideration of the conveyance of improved real 7 property or an interest therein. The exemption granted pursuant to the 8 provisions of this subdivision shall only apply to conveyances for resi- 9 dential property where the consideration is two million dollars or less. 10 § 1580. Credit. A grantee shall be allowed a credit against the tax 11 due on a conveyance of real property to the extent tax was paid by such 12 grantee on a prior creation of a leasehold of all or a portion of the 13 same real property or on the granting of an option or contract to 14 purchase all or a portion of the same real property by such grantee. 15 Such credit shall be computed by multiplying the tax paid on the 16 creation of the leasehold or on the granting of the option or contract 17 by a fraction, the numerator of which is the value of the consideration 18 used to compute such tax paid which is not yet due to such grantor on 19 the date of the subsequent conveyance (and which such grantor will not 20 be entitled to receive after such date), and the denominator of which is 21 the total value of the consideration used to compute such tax paid. 22 § 1581. Cooperative housing corporation transfers. 1. Notwithstanding 23 the definition of "controlling interest" contained in subdivision two of 24 section fifteen hundred seventy-five of this article or anything to the 25 contrary contained in subdivision five of section fifteen hundred seven- 26 ty-five of this article, the tax imposed pursuant to this article shall 27 apply to (a) the original conveyance of shares of stock in a cooperative 28 housing corporation in connection with the grant or transfer of a 29 proprietary leasehold by the cooperative corporation or cooperative plan 30 sponsor, and (b) the subsequent conveyance of such stock in a cooper- 31 ative housing corporation in connection with the grant or transfer of a 32 proprietary leasehold by the owner thereof. With respect to any such 33 subsequent conveyance where the property is an individual residential 34 unit, the consideration for the interest conveyed shall exclude the 35 value of any liens on certificates of stock or other evidences of an 36 ownership interest in and a proprietary lease from a corporation or 37 partnership formed for the purpose of cooperative ownership of residen- 38 tial interest in real estate remaining thereon at the time of convey- 39 ance. In determining the tax on a conveyance described in paragraph (a) 40 of this subdivision, a credit shall be allowed for a proportionate part 41 of the amount of any tax paid upon the conveyance to the cooperative 42 housing corporation of the real property comprising the cooperative 43 dwelling or dwellings to the extent that such conveyance effectuated a 44 mere change of identity or form of ownership of such property and not a 45 change in the beneficial ownership of such property. The amount of the 46 credit shall be determined by multiplying the amount of tax paid upon 47 the conveyance to the cooperative housing corporation by a percentage 48 representing the extent to which such conveyance effectuated a mere 49 change of identity or form of ownership and not a change in the benefi- 50 cial ownership of such property, and then multiplying the resulting 51 product by a fraction, the numerator of which shall be the number of 52 shares of stock conveyed in a transaction described in paragraph (a) of 53 this subdivision, and the denominator of which shall be the total number 54 of shares of stock of the cooperative housing corporation (including any 55 stock held by the corporation). In no event, however, shall such credit 56 reduce the tax, on a conveyance described in paragraph (a) of thisS. 4098--A 12 1 subdivision, below zero, nor shall any such credit be allowed for a tax 2 paid more than twenty-four months prior to the date on which occurs the 3 first in a series of conveyances of shares of stock in an offering of 4 cooperative housing corporation shares described in paragraph (a) of 5 this subdivision. 6 2. Every cooperative housing corporation shall be required to file an 7 information return with the treasurer by July fifteenth of each year 8 covering the preceding period of January first through June thirtieth 9 and by January fifteenth of each year covering the preceding period of 10 July first through December thirty-first. The return shall contain such 11 information regarding the conveyance of shares of stock in the cooper- 12 ative housing corporation as the treasurer may deem necessary, includ- 13 ing, but not limited to, the names, addresses and employee identifica- 14 tion numbers or social security numbers of the grantor and the grantee, 15 the number of shares conveyed, the date of the conveyance and the 16 consideration paid for such conveyance. 17 § 1582. Designation of agents. The treasurer is authorized to desig- 18 nate the recording officer to act as his or her agent for purposes of 19 collecting the tax authorized by this article. The treasurer shall 20 provide for the manner in which such person may be designated as his or 21 her agent subject to such terms and conditions as the treasurer shall 22 prescribe. The real estate transfer tax shall be paid to such agent as 23 provided in section fifteen hundred seventy-seven of this article. 24 § 1583. Liability of recording officer. A recording officer shall not 25 be liable for any inaccuracy in the amount of tax imposed pursuant to 26 this article that he or she shall collect so long as he or she shall 27 compute and collect such tax on the amount of consideration or the value 28 of the interest conveyed as such amounts are provided to him or her by 29 the person paying the tax. 30 § 1584. Deposit and disposition of revenue. 1. All taxes, penalties 31 and interest imposed by the city or town under the authority of section 32 fifteen hundred seventy-six of this article, which are collected by the 33 treasurer or his or her agents, shall be deposited in trust funds as 34 provided by this section for the city or town and shall be kept in trust 35 and separate and apart from all other monies in possession of the treas- 36 urer. The treasurer or his or her agents shall provide for separate 37 trust funds for community preservation and community housing revenues. 38 Moneys in such fund shall be deposited and secured in the manner 39 provided by section ten of the general municipal law. Pending expendi- 40 ture from such fund, moneys therein may be invested in the manner 41 provided in section eleven of the general municipal law. Any interest 42 earned or capital gain realized on the moneys so deposited or invested 43 shall accrue to and become part of such fund. 44 2. The treasurer shall retain such amount as he or she may determine 45 to be necessary for refunds with respect to the tax imposed by the city 46 or town, under the authority of section fifteen hundred seventy-six of 47 this article, out of which the treasurer shall pay any refunds of such 48 taxes to those taxpayers entitled to a refund pursuant to the provisions 49 of this article. 50 3. The treasurer, after reserving such refunds, shall on or before the 51 twelfth day of each month pay to the city comptroller or the town super- 52 visor the taxes, penalties and interest imposed by the town under the 53 authority of section fifteen hundred seventy-six of this article, 54 collected by the treasurer, pursuant to this article during the next 55 preceding calendar month. The amount so payable shall be certified to 56 the city comptroller or the town supervisor by the treasurer, who shallS. 4098--A 13 1 not be held liable for any inaccuracy in such certification. Provided, 2 however, any such certification may be based on such information as may 3 be available to the treasurer at the time such certification must be 4 made under this section. Where the amount so paid over to the city or 5 town in any such distribution is more or less than the amount due to the 6 city or town, the amount of the overpayment or underpayment shall be 7 certified to the city comptroller or the town supervisor by the treasur- 8 er, who shall not be held liable for any inaccuracy in such certif- 9 ication. The amount of the overpayment or underpayment shall be so 10 certified to the city comptroller or the town supervisor as soon after 11 the discovery of the overpayment or underpayment as reasonably possible 12 and subsequent payments and distributions by the treasurer to such city 13 or town shall be adjusted by subtracting the amount of any such overpay- 14 ment from or by adding the amount of any such underpayment to such 15 number of subsequent payments and distributions as the treasurer and 16 city comptroller or town supervisor shall consider reasonable in view of 17 the overpayment or underpayment and all other facts and circumstances. 18 4. All monies received from the treasurer shall be deposited in the 19 appropriate fund of the city or town, pursuant to section six-w of the 20 general municipal law. 21 § 1585. Judicial review. 1. Any final determination of the amount of 22 any tax payable under section fifteen hundred seventy-eight of this 23 article shall be reviewable for error, illegality or unconstitutionality 24 or any other reason whatsoever by a proceeding under article seventy- 25 eight of the civil practice law and rules if application therefor is 26 made to the supreme court within four months after the giving of the 27 notice of such final determination, provided, however, that any such 28 proceeding under article seventy-eight of the civil practice law and 29 rules shall not be instituted unless (a) the amount of any tax sought to 30 be reviewed, with such interest and penalties thereon as may be provided 31 for by local law shall be first deposited and there is filed an under- 32 taking, issued by a surety company authorized to transact business in 33 this state and approved by the state superintendent of insurance as to 34 solvency and responsibility, in such amount as a justice of the supreme 35 court shall approve to the effect that if such proceeding be dismissed 36 or the tax confirmed the petitioner will pay all costs and charges which 37 may accrue in the prosecution of such proceeding or (b) at the option of 38 the petitioner, such undertaking may be in a sum sufficient to cover the 39 taxes, interest and penalties stated in such determination, plus the 40 costs and charges which may accrue against it in the prosecution of the 41 proceeding, in which event the petitioner shall not be required to pay 42 such taxes, interest or penalties as a condition precedent to the appli- 43 cation. 44 2. Where any tax imposed hereunder shall have been erroneously, ille- 45 gally or unconstitutionally assessed or collected and application for 46 the refund or revision thereof duly made to the proper fiscal officer or 47 officers, and such officer or officers shall have made a determination 48 denying such refund or revision, such determination shall be reviewable 49 by a proceeding under article seventy-eight of the civil practice law 50 and rules; provided, however, that (a) such proceeding is instituted 51 within four months after the giving of the notice of such denial, (b) a 52 final determination of tax due was not previously made, and (c) an 53 undertaking is filed with the proper fiscal officer or officers in such 54 amount and with such sureties as a justice of the supreme court shall 55 approve to the effect that if such proceeding be dismissed or the taxS. 4098--A 14 1 confirmed, the petitioner will pay all costs and charges which may 2 accrue in the prosecution of such proceeding. 3 § 1586. Apportionment. A local law adopted by any city or town, pursu- 4 ant to this article, shall provide for a method of apportionment for 5 determining the amount of tax due whenever the real property or interest 6 therein is situated within and without the city or town. 7 § 1587. Miscellaneous. A local law adopted by any city or town, pursu- 8 ant to this article, may contain such other provisions as the city or 9 town deems necessary for the proper administration of the tax imposed 10 pursuant to this article, including provisions concerning the determi- 11 nation of tax, the imposition of interest on underpayments and overpay- 12 ments and the imposition of civil penalties. Such provisions shall be 13 identical to the corresponding provisions of the real estate transfer 14 tax imposed by article thirty-one of this chapter, so far as such 15 provisions can be made applicable to the tax imposed pursuant to this 16 article. 17 § 1588. Returns to be secret. 1. Except in accordance with proper 18 judicial order or as otherwise provided by law, it shall be unlawful for 19 the treasurer or any officer or employee of the county, city or town, 20 including any person engaged or retained on an independent contract 21 basis, to divulge or make known in any manner the particulars set forth 22 or disclosed in any return required under a local law enacted pursuant 23 to this article. Provided, however, that nothing in this section shall 24 prohibit the recording officer from making a notation on an instrument 25 affecting a conveyance indicating the amount of tax paid. No recorded 26 instrument affecting a conveyance shall be considered a return for 27 purposes of this section. 28 2. The officers charged with the custody of such returns shall not be 29 required to produce any of them or evidence of anything contained in 30 them in any action or proceeding in any court, except on behalf of the 31 county, city, or town in any action or proceeding involving the 32 collection of a tax due under a local law enacted pursuant to this arti- 33 cle to which such county, city, or town is a party, or a claimant, or on 34 behalf of any party to any action or proceeding under the provisions of 35 a local law enacted pursuant to this article when the returns or facts 36 shown thereby are directly involved in such action or proceeding, in any 37 of which events the court may require the production of, and may admit 38 in evidence, so much of said returns or of the facts shown thereby, as 39 are pertinent to the action or proceeding and no more. 40 3. Nothing in this section shall be construed to prohibit the delivery 41 to a grantor or grantee of an instrument effecting a conveyance or the 42 duly authorized representative of a grantor or grantee of a certified 43 copy of any return filed in connection with such instrument or to 44 prohibit the publication of statistics so classified as to prevent the 45 identification of particular returns and the items thereof, or the 46 inspection by the legal representatives of such county, city, or town of 47 the return of any taxpayer who shall bring action to set aside or review 48 the tax based thereon. 49 § 3. Severability. If any provision of this act or the application 50 thereof shall for any reason be adjudged by any court of competent 51 jurisdiction to be invalid, such judgment shall not affect, impair, or 52 invalidate the remainder of this act, but shall be confined in its oper- 53 ation to the provision thereof directly involved in the controversy in 54 which such judgment shall have been rendered. 55 § 4. This act shall take effect immediately.
