Successful commercial tax challenges have shifted more of the property tax burden onto single-family homeowners in Nassau while overall assessment reductions are pushing up tax rates throughout the county, according to a legislative report.
Single-family homeowners have seen their share of the total tax bill rise by 8.3 percentage points over the past decade, largely because of commercial reductions, the legislature's independent Budget Review Office reported.
In just the past year, as the county granted tens of thousands of residential assessment reductions, nonschool tax rates in Nassau's towns increased by as much as 17 percent while school tax rates jumped three times higher than expected.
Despite a county freeze on assessment increases and a state tax cap, "it is still possible for a resident to experience a double-digit increase in his or her property tax bill," the office concluded. "Lower assessed valuations are triggering property tax rate increases. Since the county has frozen assessments, everyone, except those who successfully grieved their parcels, are paying a greater share."
Even those who won assessment reductions "may be paying a higher share of the property tax levy," the office reported.
The Budget Review office analyzed assessments before any reductions that may result from superstorm Sandy. It did not include the county general fund tax bill in the study.
A spokesman for County Executive Edward Mangano, a Republican running for re-election this year, called the report "nothing more than political spin."
Aide Brian Nevin said, "Ed Mangano has never increased taxes and all residents have the ability to correct their assessment before making payment. With 85 percent of residents grieving their taxes, this would suggest 85 percent saw their taxes go down. Again, Nassau County has not taken an additional dime from taxpayers as Ed Mangano has frozen the tax levy for three straight years."
Budget Review Director Maurice Chalmers said the report speaks for itself. It notes that county tax collections have remained level under Mangano. But it also points out that tax rates must increase when assessed values go down in order to collect the same amount in taxes.
The office reported that Nassau's total assessed value plunged 20.8 percent since 2010 while home prices declined just 2.3 percent from 2010 through 2012.
Legis. Wayne Wink Jr. (D-Roslyn), who requested the report, said the Mangano administration has "built a system that has no connection to reality whatsoever. It's all about getting people to challenge and drop their assessment so they think they are getting a deal. But if everyone gets a reduction, then nobody gets a reduction."
The report notes that commercial properties' share of the tax burden had decreased as homeowners paid more. Business assessments are determined by how much a commercial property can collect in rent. "Hence in a down economy when commercial parcels make less rental income, they can successfully lower their property tax expenses. No such mechanism exists for residential homeowners. If a household earns less money, their house could still retain its value," the report said.
Attorney Laureen Harris, head of Nassau's tax challenge bar, said the swing between business and residential taxes would have been even greater were it not for the State Legislature, which has traditionally passed legislation "to buffer the tax shift shock" when values fluctuate dramatically.
North Hempstead Supervisor Jon Kaiman, a Democrat "exploring" a run against Mangano, said the report "is consistent with what we've been hearing and seeing: people's tax bills going up thousands of dollars from one year to the next. It's an indication of a system that's failed."
James Stefanich, Oyster Bay tax receiver, said rates in some water districts soared because of costs to clean up pollution. "Put that on top of the assessment reductions, and it makes properties that didn't get reductions pay a bigger share," he said.
Homes are Class 1 properties - single-family homes and condominiums of three floors or less. About 102,000 homes countywide were not counted because they had renovations done or had exemptions other than basic STAR, both of which would have influenced assessed value. Homes in Amityville and Cold Spring Harbor were excluded because those school districts lie primarily in Suffolk County. Glen Cove was excluded because the city of Glen Cove does its own assessments. The Bellmore-Merrick, Sewanhaka and Valley Stream Central high school districts are not listed because their taxes are levied by the component elementary districts.