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The Homestead Tax can be implemented only at the same time as a systematic review of all assessments, which is happening this year. The board has not decided at what interval it will conduct that systematic review, Mamaroneck Town Administrator Steve Altieri said.
"We decided that given that the assessment itself is pushing us leaps and bounds toward a more fair and equitable valuation for the community, and that the additional Homestead Option would have increased taxes two or three times on the condo owners, at this point, let's just let the reassessment happen and see how it all goes," Mamaroneck Town Supervisor Nancy Seligson said.
The purpose of the Homestead Tax Option is not to place undue burden on condominium owners. It is to tax commercial properties (essentially condominiums, as they produce income through rent) the same way single-family homes and co-ops are taxed - based on their market value. It is intended to make the taxation process more equitable despite its seemingly unfair outcome.
"In general, it seems that valuing the condos at an income-producing level is probably too low, and it seems that valuing them at the market sale price is too high at this point," Seligson said.
David Barnett from GAR Associates, a contractor hired by the Town of Mamaroneck to do the property reassessment, gave examples of how the Homestead Option could impact a condominium owner if implemented at the same time as this revaluation.
Barnett's example was based on a condominium with a 2012 median taxable value of $193,276. Based on this, the condo owner would be paying taxes (town/county plus school) in the amount of $4,500. After the reassessment, this condominium's taxable value could go up to $299,000, bringing the owner's taxes to $6,820. With the Homestead Option, the condo's value (now being assessed based on market sale price versus income production) would go up to $505,000, and the taxes would be raised to $11,400.
On the converse, if the Homestead Tax Option was adopted, the owner of a single-family home with a 2012 median taxable value of $845,000 who was paying $19,600 in taxes would see his home value go up to $913,000 and taxes go up to $20,600. This is less than what the homeowner would be paying in taxes post-reassessment without the Homestead Option: $20,800.
"So while the residential class overall won’t see much impact, there will be a specific minority group of condo owners that could possibly see some substantial increases," one resident said at a public hearing at a Town of Mamaroneck Board Meeting. "I’d say a local government has the responsibility to protect the minority interest in a community."
The board heard the community's opposition and put off the possibility of adopting the Homestead Option.
"It would be too much of a hit on the condo owners at this moment in time," Seligson said, explaining that it could come up again during the next reassessment.
"I happen to live in a co-op and I believe that it was unfair to raise the taxes on the condos," said Lois Steinberg, who attended the public hearing because she initially thought the Homestead Tax applied to co-ops as well. "Everybody should share, not just the condo residents. That’s my personal opinion. The bottom line is the fairness issue."
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