Assembly Member Kellner's Statement on Rescission of FMV Tax Bill

Below is unedited statement by Assembly Member Micah Kellner addressing the rescission of Fair Market Value Equivalency Tax bills recently issued to the Rivercross, Westview and Island House buildings.

January 24, 2008

Rivercross, Westview, and Island House Tax Bill Rescinded
Statement by Assembly Member Micah Z. Kellner

“Yesterday, Empire State Development Corporation (ESDC) Chairman Patrick J. Foye announced that after considering the input of residents, owners, and local elected officials, ESDC has decided to rescind the tax bills sent last September to Westview, Island House, and Rivercross and to continue to allow the buildings to receive their tax exemptions as long as they remain in the Mitchell-Lama program. I’m glad to see, after six months of playing keystones cops, that the administration has finally come to its senses and rescinded this unfair tax bill.

“When the tax bills were first received, they put the future of affordability for Mitchell-Lamas on Roosevelt Island in peril. I immediately wrote to the Governor expressing my frustration over the disparate treatment that Roosevelt Island residents were receiving. Every other Mitchell-Lama in New York City receives this tax exemption, and Roosevelt Island should not be treated any differently. In 2005, after authorization from the State Legislature, the New York City Council passed Resolution No. 388-A, extending real property tax exemptions for 50 more years to housing companies if their buildings remain in the Mitchell-Lama program. Rivercross, Westview, and Island House are still in that program.

“I could never understand how the administration could argue that threatening to raise taxes was an appropriate tactic to bullying struggling tenants and shareholders into remaining in the Mitchell-Lama program. This was a dangerous game of chicken that could have gone horribly wrong, costing thousands of families their homes.

“Sadly, ESDC was driving this process blind because they did not have all the facts. When it was clear that the administration was not aware of the impact the tax bill would have on the standing of Rivercross’ Community Preservation Corporation loan – it might have caused Rivercross to be forced to raise maintenance levels for shareholders by as much as 60% – I made sure that they were informed. I’m glad to see that everyone is finally on the same page. I only wish that it had not taken six months and that Roosevelt Islanders could have been spared the frustration and the anxiety that comes from your home being threatened.

“Let’s not kid ourselves, this issue is far from settled and the devil is always in the details. As we go forward I will continue to monitor the situation to ensure that the ground lease amendments are negotiated in such a way such that retroactive, unfair taxes are never again a possibility that looms over the heads of Islanders.”