Since the pandemic, more New Yorkers stopped paying their property taxes. It’s attributed to the end of the tax-lien sales program that would go into effect when people didn’t pay their taxes.
The notoriously incompetent City Council didn’t renew it. Under that plan, the city was authorized to sell liens on single-family homes and condos after three years of nonpayment; liens on other property types could be sold after one year.
They don’t have to and don’t seem to care, or they can’t because New York is bad for business. Inflation and regulations are not mentioned but must be part of the problem. Bloomberg mentions that mandatory regulated rents make it hard for landlords to collect rents.
Overdue property taxes are forecast to reach their highest level ever, jumping by over 30% to more than $880 million at the end of the fiscal year in June from three years ago. That means New York will bring in less tax revenue since nearly half comes from property tax collections.
THERE ARE NO CONSEQUENCES
“It’s not just the absolute dollar amount that I think should worry us all,” said Preston Niblack, the city’s Finance Commissioner, at a March 4 City Council finance committee hearing.
It’s people realizing that “there are no consequences for not paying your property taxes,” he said. “That just can’t be allowed to continue.”
NY IS BAD FOR BUSINESS
The rise in unpaid property taxes comes as New York’s office market continues to struggle. According to the city’s January financial plan, the overall vacancy rate for Manhattan office space stood at 22.5% in November, the highest on record.
Maybe it’s because people don’t want to do business in New York?
Rent-regulated apartments are also under stress because a 2019 law made it more difficult for landlords to raise rents.
The city’s Department of Finance said it is working on legislation to reauthorize tax-lien sales to ensure homeowners don’t face foreclosure or eviction.
Lots of luck with that.
BIG SCOFFLAWS
New York expects to collect $32.7 billion in property taxes in the current fiscal year, providing about 45% of city tax revenue and almost 30% of overall funds for the current $114 billion budget.
City Council Member Gale Brewer, who represents the Upper West Side of Manhattan, said three buildings in her district each owe $1 million.
As of March 8, single-family and condo owners made up a third of delinquencies, while rentals comprised 28.5% and commercial property 38.2%, according to the Department of Finance.
A 16-unit Cobble Hill, Brooklyn, rental building owes $52.2 million and a 49-unit apartment building in the Bronx owes $24.7 million..
“We have to do something,” Brewer said. “People should pay their taxes.”
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