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Real estate record and builders' guide: [v. 94, no. 2434: Articles]: November 7, 1914

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REAL ESTATE AND NEW YORK, NOVEMBER 7, 1914 iP"!!:iti:i|:e;;!iri!^:r.Niwi''.;'--.Ki>yi 'i^?; !lf[!iiiij|[[«inj(j|ili|J(|l|ri;ili||i[i[i]!l|jilil]^^^ ' I. ;■-■-. :' '■■■-^ UPSTATE COUNTIES THRIVING OFF THE CITY Unjust Taxes Imposed Upon the City of New York by the Assessors of the Taxing Districts in the Catskill Watershed By IRA J. ETTINGER Executive Secretary, United Real Estate Owners' Associations fiiiilliiMii^^ ONE of the most important subjects which is now engaging the attention of the Taxation Committee of the United Real Estate Owners' Associations is the grave and serious injustice done to the City of New York by the local assessors in about twenty towns in which the aqueduct property recently acquired by the City of New York is situate, in plac¬ ing assessments against the City of New York in utter disregard of the value of the property and including in such valua¬ tions dams and aqueducts above or be¬ low the ground including in many cases tunnels far beneath the surface and tak¬ ing the cost of the construction as the basis for the assessment. This unjust imposition affects every taxpayer in the city. For the year 1913 increases in assessed valuation amounted to twenty-two and a half millions of dol¬ lars upon the holdings which the city acquired for the Catskill water supply purposes alone; and this increase repre¬ sents solely the value of construction work and reflects no increased worth in the land. In the whole United States there are only two commonwealths, namely, Mas¬ sachusetts and New York, wdiere such a species of taxation exists. In the State of New Jersey it has always been the law, as it has been in all of the other commonwealths, that a water supply is a public necessity and must be provided by the State for the people of its sepa¬ rate municipalities, in order to enable them to exist. Under the old common law no property used for water supply in the State of New York was taxed, no matter where it was located in the State, but this was changed by Chapter 502 of the Laws of 1866, which was incorporat¬ ed in the Consolidated Laws of 1882, and was subsequently re-enacted in the Greater New York Charter as Section 480. Where the Trouble Began. The protecting clause in Section 480 of the Greater New York Charter was stricken out in the year 1901, and this has been the origin of all our present dif¬ ficulties. When the General Tax Law of 1909 was passed it was claimed that it repealed all previous laws including the Charter provision with the result that each of these separate towns has im¬ posed upon the City of New York a dif¬ ferent rule of assessment. And as was stated in the brief of the Corporation Counsel of the City of New York in con¬ nection with the amendment proposed in the Legislature in the year 1913: "We have the unusual spectacle of municipal corporations, creatures of the State, gov¬ erned and controlled by the Legislature, engaged in bitter and costly litigation at the expense of the taxpayers of each community, all of whom are citizens and residents of this State, and each of whom are entitled to exact and equal justice at the hands of the Lesfislature." In the. State of Massachusetts it was not until 1903 that a law was passed which made the land, but exclusive of constructions, assessable for purposes of 5uch taxation; and this law was adopts IRA J. ETTINGER. ed because the City of Boston extended its municipal water supply system and reached out to bring in streams and im¬ pound them for the purpose of supplying its population; and land taken for the water system was placed upon the tax list. Failure of Relief Measures. During the session of the New York Legislature in the year 1913 a bill was introduced amending the Tax Law pro¬ viding that all lands heretofore or here¬ after acquired for the purpose of a water supply by any municipal corporation within the limits of another municipal corporation shall hereafter be assessed and taxed at the value of said lands ex¬ clusive of all dams, aqueducts and other structures necessary for the purpose of a water supply and it was therein provided that in the valuation of said lands the assessors shall treat all lands flooded by the construction of dams, or used for the purpose of storing or impounding waters thereon, as land not under water, but despite all of the efforts put forth by the City of New York and its represen¬ tatives and notw^ithstanding the argu¬ ment presented by President Charles Strauss, of the Board of Water Supply, before the joint Committee on Taxation and Retrenchment, the bill failed of pas¬ sage and the old confused and unjust system has continued to this very day. The brief of the Corporation Counsel recites that there are pending in the courts in the counties of Westchester and Putnam one hundred and twenty certiorari proceedings to review the in¬ equalities and over-valuations of the as¬ sessment of the lands of the City of New York in fifteen different tax dis¬ tricts. These over-valuations occur on property of the City of New York that contains no structures because of the idea in the minds of the various assess¬ ors that the City of New York is a rich municipality because it is deenied just and proper to extract as much money from the City of New York as a tax¬ payer as is possible and to make the tax burden upon the City of New York as heavy- as the ingenuity of the local as¬ sessor might devise. Because of the uncertainty of the law and the decisions of the courts upon the subject the assessors also claim the right to assess the aqueduct structures, al¬ though Supreme Court Justice Mor- schauser, sitting in Orange County, de¬ cided that the aqueduct structures were not assessable, which decision has since been affirmed by the Appellate Division, an appeal having been taken to the Court of Appeals which has not yet ren¬ dered its opinion in the matter. Specific Cases of Injustice, To show the real injustice that has been practiced upon the City of New York by the different communities a few glaring instances, taken from the memo¬ randum of the Board of Water Supply will now be cited: In the Town of Mt. Pleasant, West¬ chester County, parcel 803, consisting of 43 acres, was assessed in 1910 at $21,945, an average of $500 an acre. The assess¬ ment against the former owner who parted with the property the year-be¬ fore the city acquired it, was at the rate of $100 an acre. Parcel 805 was assessed in 1905 at $50O an acre. The former owner, the year before, was assessed at only $92 an acre. In the Town of Cortlandt. Westches¬ ter County, the average assessment per acre against the citizens is $716, while the assessment as:ainst the City of Nevv York is $4,348. the City of New York owns 5 per cent, of the area and pays 23 per cent, of the taxes. In the Town of Gardiner, Ulster County, parcel 221 is known as the Deyo Farm. It consists of 160 acres; the city took 8J/2 acres, and while the assessment of $4,300 was placed against the former owner upon the entire 160 acres in 1907, the city, on taking title, was assessed $3,225. In this town in 1908 the assessment was $18.74 per acre; when the City of New York came in there the assessment was increased to $375 per acre upon all the land to which the City of New York took title. In the Town of Philipstown, Putnam County, the assessment on the identical lands was increased from $68,803 in 1912 to $3,030,203 in 1913. This assessment was protested by the city on Grievance Day, and a bill was later rendered to the Board of Water Supply for 'the 1913 taxes for $490,321; the payment of these taxes has been withheld by the city pending the result of certiorari proceed- - ings. What Yonkers Has Done. In the City of Yonkers the assessment was increased from $750,550 in 1913 to $19,280,150 for 1914; and payment^ of these taxes is now the subject of litiga¬ tion. These are not exceptional instances; they simply indicate the general spirit of the assessors throughout these .coun¬ ties, resulting in gross injustice to the