Soon after Nassau Legis. Howard Kopel (R-Lawrence) took office in 2010, he began thinking about the county’s $100 million-a-year problem of property tax refunds.
A proposed escrow fund that will be used to repay commercial property owner’s overpaid property taxes, funded essentially by the property owners themselves.
Legislation to create this fund has been filed in Albany and the Nassau County Legislature is expected to approve a home-rule message Monday, asking state lawmakers to enact the plan.
At a news conference on Friday, Presiding Officer Norma Gonsalves (R-East Meadow), credited Kopel for the proposal, which he presented to County Executive Edward Mangano in 2010. If it succeeds, it would relieve the county of paying the costs of overassessments, which has averaged $80 million to $100 million a year for decades. The county has traditionally borrowed to pay the refunds, adding to its debt burden.
Kopel recalled that soon after he was elected, “I just wanted to do something to deal with this fact that we’re borrowing $100 million a year. I kind of fiddled around with my pen. I came up with a power point. [The legislation] came out pretty close to that.”
He said Mangano first wanted to repeal the county guaranty, which calls for the county to pay for its assessment mistakes by shouldering the cost of refunds for school districts, towns and special districts. The state’s highest court rejected that idea and Mangano soon turned to Kopel's idea.
Kopel said his plan covers the cost of the county’s share of the tax refunds, generally less than 20 percent of the total owed.
“This takes care of all of it, if it works,” Kopel said. “And it should work.”
The proposal calls for the county to reduce its assessment roll up to 10 percent for commercial property owners who challenge their assessment. The businesses would be billed for the difference between the original assessment and the reduced assessment if the protest isn’t resolved by the time the roll becomes final. That bill would be calculated by using the new, presumably higher, tax rates generated by the new assessment roll. The billed amount would be deposited into an escrow fund, which would be used to repay the business if its challenge is successful or distributed to the taxing districts if it isn’t.