Crains New York - June 25, 2012 - (Page 15)

GREG DAVID T Another tax break that benefits the rich he complexities of New York City’s property-tax system can make your head hurt. That’s probably why the state Legislature will likely preserve an absurd tax break for co-op and condo owners. Here’s the story.For decades,the city kept property taxes for single-family homes artificially low, especially compared with the suburbs,in a bid to preserve the middle class. Following the wave of co-op conversions in the 1980s and the building of thousands of new condominiums, pressure City taxes favor some types of property mounted to extend a similar over others. benefit to the owners of those apartments. That’s exactly % market % tax Property type value levy what happened in 1997. Now the law of unintended 1- to 3-family homes 30.6% 14.3% consequences has taken over, Co-ops and condos 33.7% 15.7% as the Independent Budget Office’s research has shown. Rental buildings 11.2% 19.9% Because of quirks in the city’s Sources: IBO, Department of Finance tax-assessment practices, coop and condo owners today get an their fair share,as the accompanying even bigger benefit than homeown- chart shows. ers, costing the city about $260 milThe IBO noted recently that at lion annually. 101 Central Park West, where the The biggest savings go to people average unit is valued at $5.8 milwho live in the best neighborhoods, lion, the effective tax rate is 52 cents particularly around Central Park per $100 of market value. The cityand in brownstone Brooklyn. wide average for single-family Meanwhile, rental apartments have homes is 78 cents. been saddled with enormous propIn a column last year, I looked at erty-tax bills and pay far more than the taxes for two apartment houses on UNREAL ESTATE Fifth Avenue. The co-op building at 810, home to the likes of Charles Bronfman and Peter G. Peterson, paid $10.91 per square foot in taxes. The 208-unit luxury building next door paid $22.62.What justifies that? There are three classes of losers here: tenants, to the extent that property taxes are passed on in rent; landlords, to the extent the taxes can’t be passed on because of market conditions; and people who need affordable housing, because it isn’t going to be built if the property-tax problem isn’t fixed. It appears the Bloomberg administration tried to fix the problem, at least in part, by pushing proposals to limit the benefit for the most expensive co-ops and condos and eliminate it for investor-owned units. I say “appears” because it did so stealthily, working behind the scenes in Albany. Its efforts went nowhere. While the Legislature failed to act before it left town, the word is there is an agreement to extend the tax break retroactively. No one understands why the mayor’s people did it that way. Good, nonpartisan work from the IBO and the Furman Center at New York University has laid the groundwork for overhauling property taxes. Companies with large stakes in rental properties, like Related, would surely be willing to join a reform effort. Let this be a lesson: Next time, the issue needs to be debated and pushed publicly. C O L L E C T I O N L I T I G AT I O N & J U D G M E N T E N F O R C E M E N T All types of debt collection matters and general commercial litigation, trials, and appeals. AGGRESSIVE - RESOURCEFUL - EXPERIENCED - RESPONSIVE 10 0 L A FAY E T T E S T R E E T - S U I T E 6 01 | N E W YO R K , N Y 10 013 212- 6 0 8 - 5 3 0 0 | W W W. D O R A Z I O - L A W.C O M ALAIR TOWNSEND A To Amari and others like her: Welcome decade ago,this newspaper participated in a youth program called Exploring,which brings groups of high-school students into the offices of businesses and nonprofit organizations to gain a clearer picture of what various careers actually entail. At Crain’s,the students met with our photographer,editor and several reporters, and wrote the stories and took the photographs for a special issue of the paper. Each year there were one or two students who stood out as being especially bright, motivated and eager to learn—the kind of people you’d like to have as employees. We usually offered such students part-time jobs after school. One of them was a young woman I will call Amari, who was born in Africa.Amari eagerly accepted our job offer. Shortly before her first check was due, our HR department said there was a problem with her Social Security number, and I needed to verify its accuracy.I asked Amari to check her number. That was the last time I saw her. I then realized she was undocumented. I have thought of Amari often over the years, wondering what happened to her and trying to imagine what life would be like for an intelligent, motivated young woman who seemed consigned to living in the shadows and on the edge of our society. I have hoped she went to college, which she could have done without divulging her immigration status. Assuming she graduated, what should have been an open door to a career instead was a dead end.Where could she work? What a waste for us, and what an endless source of frustration for her this limbo must have been. Last week’s immigration-policy announcement by President Barack Obama offers people like Amari— an estimated 800,000—at least a short-term respite from the shadows. Young people who were brought here before they were 16 and who are below the age of 30 and were successful students or served in the military can apply for work permits without fear of deportation— for two years. It requires a leap of faith that, having revealed themselves to authorities, they will have their legal status resolved permanently and positively after two years. To justify that faith requires Congress to act, preferably by enacting full-scale immigration reform, but at least by passing the DREAM Act. The original DREAM Act was cosponsored and supported by both Republicans and Democrats. This legislation would provide a pathway to citizenship for people like Amari. By introducing the new policy in the middle of an election year, Mr. Obama has drawn the expected praise and criticism. Republicans, in election-year high dudgeon, charge that he is overreaching and usurping congressional authority, that the policy will lead to people filing fraudulent claims of having been brought here before the age of 16, and that it will allow illegal immigrants to take jobs that should go to Americans. The simple fact is that Amari and hundreds of thousands of others like her are here, now more American than the nationality of the land of their birth, and eager to be productive citizens. It is time to tell them, “Welcome home.” June 25, 2012 | Crain’s New York Business | 15 http://www.dorazio-law.com http://www.dorazio-law.com

Table of Contents for the Digital Edition of Crains New York - June 25, 2012

Crains New York - June 25, 2012
Contents
In the Boroughs
In the Markets
The Insider
Business People
Alair Townsend
Greg David
Real Estate Deals
Crain’s Fast 50
For the Record
Classifieds
New York, New York
Source Lunch
Out and About

Crains New York - June 25, 2012