Nassau’s revised 2016 county budget, slated for consideration Friday by the county’s financial control board, includes $35.6 million in revenue from increased real estate fees that could add hundreds or thousands of dollars to the cost of buying, selling or refinancing properties in the county.
The increased fees likely will make Nassau’s closing costs the highest in the state. Thomas Tafuri, land records chairman of the New York State Land Title Association, said that while he had no statewide study, he was certain that Nassau’s closing costs will be the highest in the metropolitan region of New York City, Westchester, Suffolk and Nassau.
To avoid a 1.2 percent property tax increase, the Nassau Legislature last month voted to hike the county tax map verification fee, first collected in April, to $225 from $75, and the county clerk block recording fee, only $10 in 2009, to $300 from $150. The new fees become effective Monday.
The problem is that each fee can be imposed multiple times in a single transaction, said critics, including Legis. Howard Kopel (R-Lawrence), the only lawmaker to vote against the fee increases, and Republican County Clerk Maureen O’Connell, who lobbied against the hikes.
Every document in a deal requires a separate fee. For example, refinancing a $50,000 mortgage to $100,000 could involve three separate documents, each requiring payment of the $225 tax map verification fee and the $300 recording fee, for total county fees of $1,575 — a $1,125 increase over a year ago for the same transaction. The cost does not include state-imposed charges.
Also, the same fees apply whether the house is worth $300,000 or $3 million. Unlike property taxes, the fees are not tax deductible.
“For the standard residential buyer or seller, it’s going to increase their costs substantially,” said Craig Feldherr, a Merrick attorney.
Kopel, who runs a title insurance firm, said the increases were not justified. “A fee is supposed to be the recovery of costs.”
O’Connell said lawmakers should have given leniency to first-time homebuyers in Nassau’s high-priced housing market, to veterans and to seniors paying off their mortgages.
A spokesman for County Executive Edward Mangano noted both Republican and Democratic lawmakers voted in favor of the fee increases. Lawmakers had rejected Mangano’s proposed property tax increase, estimated to cost the average homeowner $23 annually.
Presiding Officer Norma Gonsalves (R-East Meadow) said the legislature had passed a budget that cut fee increases, eliminated the property tax increase “and preserved all vital county services,” but Nassau’s control board, the Nassau Interim Finance authority, rejected it.
“As a result, the county legislature adopted a three-pronged plan that preserved all county services, cut budgetary expenditures, and unfortunately restored the cuts in fee increases to satisfy NIFA’s demand for the inclusion of new revenue.”
NIFA chairman Jon Kaiman said the board doesn’t get involved in county policy decisions. “We just look to to see if the numbers add up consistently with the amount of money they want to spend.”
But he added, “This is what happens when the government doesn’t have the political will to spread the cost of governing across the entire population. Instead of paying $10, some people have to pay thousands of dollars.”