Rye Town Requires Proof From Tax Grievers

A new Rye Town law that requires owners of commercial properties to include income and expense statements when they ask for a reduced tax rate has worked, according to a presentation by Town Supervisor Joe Carvin.

The law allows the town to fine grievers who do not bring their income and expense (I&E) statements to the Town’s Board of Assessment and Review (BAR) three percent of their property’s assessed value.

The town passed the law to prevent commercial owners from claiming their property value is worth less than it is by forcing them to prove their claims.

In a recent article, Westfaironline.com’s Mark Lungariello covered the new law in depth. He writes:

The town has received an average of 220 commercial property complaints since the reassessment, with 247 in 2011 and 223 in 2012. During that time, $2.4 billion in commercial value has been challenged and since 2009 Rye has paid $1.1 million settling commercial tax court cases.

Town officials say that claiming unusually high reductions has become a racket for lawyers, according to Lungariello.

The required documentation is normal, but the fines are “unheard of” in the area, according to the article.

Read Lungariello’s full article here.

In previous years, no more than 20 percent of challengers included the I&E statements. This year, with the threat of the penalties, 99.9 percent of respondents included the statements.

Rye Town Volunteer Media Coordinator Dick Hubert writes:

“This compliance is an important first step in the Town’s efforts to break the back of the “gaming of the cert system” by lawyers cynically representing commercial property owners where the average claim is still presented at 25% of value and where only 2 out of 204 claims came direct from property owners themselves.”

Here is an outline of Carvin’s presentation, given on Aug. 27, 2013 to the Board of Trustees:

•Beginning in 2013, Town’s new law requires owners of commercial (income-producing) properties to include information on their property’s income and expenses when they request the Town’s Board of Assessment & Review (BAR) to reduce their assessment or they will be fined 3% of property’s assessed value.

•This year, 209 property owners requested the BAR to reduce their assessed value

•Upon learning of the new I&E requirement, 9 owners withdrew their request

•To date, 197 (94%) have submitted their I&E information; 3 property owners have an 8/30 deadline.

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•Only 2 owners submitted their request to the BAR directly

•195 (99%) owners authorized someone to represent them before the BAR

•6 representatives brought 66% of the cases to the BAR

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•An analysis of 80 submissions to the 21013 BAR showed:

- On average, owners requested that their assessed value be reduced 80%

- 38% requested that their values be reduced 90% or more

- 59% requested that their value be reduced lower that the value indicated from their own I&E data