Baldwinsville Village officials recently passed NY RPT Law 485-A, which allows an eight-year exemption on property taxes (plus four additional years of reduced taxes on a sliding scale) for improvements made to the residential portion of a mixed-use property. The law is designed to revitalize development in urban areas and does not affect the taxpayer because without the potential investment and improvement, there are limited taxes to collect.
“Property taxes are high in New York State,” said Mayor Joseph Saraceni. “This law would encourage property owners to invest in their property without fear of property taxes, which would give them time to find tenants for the renovated space.”
This law would benefit businesses with multiple floors of property like Pizza Man, which operates a restaurant and pub on the main floor, then has three floors of empty space that could potentially be renovated into condos. However, investing money to develop those three floors is a big risk, especially if they remain empty for an extended period of time once completed.
“People get whacked with property taxes if they don’t find a tenant in time,” Saraceni said. “With this law, no one loses anything. Municipalities just don’t start receiving property taxes until the eight years are up.”
Property owners taking advantage of this exemption would continue to pay the entire tax bill for their commercial property, as well as any residential portion that has already been developed.
This law follows Smart Growth Planning, a concept the village and county practice.
“All this does is stimulate redevelopment,” Saraceni said. “We want more density downtown – more people shopping locally, traveling along our sidewalks.”
Baldwinsville is the first village in Onondaga County to pass this legislation. However, for investors to receive the full benefit of the law, all taxing entities within an area must pass it. So far, Onondaga County and the village have adopted the law.