Are property tax breaks for developers and commercial real estate owners making it more expensive for home owners?
News of one Nassau County town considering rescinding one mall’s tax breaks raises the question of whether there should be a crackdown on tax incentives to avoid putting more of the budget burden on individual residential property owners. Others may argue that is the opposite of what we need to make places like Long Island more affordable and sustainable.
Hempstead Town’s Industrial Development Agency is contemplating revoking tax breaks for Green Acres Mall, per the chairman of the board. The argument is that the breaks have pushed steep tax increases onto local Valley Stream homeowners.
So, are developer tax breaks really costing you that much? They often get sweet tax breaks for redeveloping and building. These breaks can run into really big numbers, over a number of years. Fraud and sweet heart deals aside, the idea is that local government wins in the long term thanks to higher tax bases, more jobs, and greater incomes for locals. The official New York State website proclaims that tax credits and other incentives are specifically used to help expand small businesses and to enable them to secure good locations and invest in the workforce.
There certainly are a number of big stories which hit the news about super-sized breaks. However, data from Curbed NY suggests we’re still building and approving far less units that we used to in New York City and the surrounding area. As of 2014, fewer new Certificates of Occupancy were being issues than in 2000. At the same time, affordable housing units reached their second highest rate in 2014, of any year since 1988. The New York City Department of Finance shows that in terms of land use 1-4 unit residential properties and open space and recreation by far took up the most land space.
We also have to factor in the outrageous rate of flawed and bloated property tax bills sent out to homeowners each year. With almost half of them knowingly incorrect and eligible for appeals, that seems to be a far larger area of waste and inequality. First there are likely millions spent on this broken system, and then handling challenges to bills they knew were incorrect. If more non-payers like banks were held accountable, and accurate bills were sent out, many may find that they are billed significantly less each year. If we ever fixed the system, those savings could be passed on to homeowners as well.
Summary
While it is good to have watch dogs overlooking tax breaks and incentives which are handed out, there may be other areas which put more of a burden on homeowners than those which are fruitfully used to create jobs. While there may be little hope of the system being fixed soon, each tax payer has the right to appeal their annual property tax bill. Property Tax Adjusters, Ltd. Can help with that.