The Southold Town Board took a formal stand last Tuesday against proposed changes to the state’s Real Property Tax Law that would drastically change how property is assessed for renewable energy facilities.
“It’s really going to take [assessment] out of the hands of the towns and the main concern is that it’s going to take [properties] off the assessment rolls,” Board of Assessors chair Kevin Webster explained at a work session.
Current state law allows for a 15-year tax exemption for renewable energy projects and a provision in the law allows local governments to opt out of the exemption and instead require a payment in lieu of taxes, or PILOT agreement, that can benefit towns and other special taxing districts, including school districts.
If approved, the new legislation, which is included as a 2022 state budget proposal, allows the state to establish a more standardized approach for assessment of properties that are home to renewable energy projects.
According to the text of a resolution opposing the proposal, which was unanimously adopted, the assessed value for those properties would instead be determined by an “income capitalization or discounted cash flow approach that considers an appraisal model created by the New York State Department of Taxation and Finance”and state Energy Research and Development Authority.
“You’d essentially be telling schools, towns and counties that they must exempt the properties,” Supervisor Scott Russell said.
Though she ultimately voted to support the resolution opposing the new law, Councilwoman Sarah Nappa wondered if it could de-incentivize companies from locating alternative energy within the town.
Board members agreed that while they don’t want to discourage the creation of renewable energy, they’d like to retain some local control.
“All the taxing districts are going to lose money [if the legislation passes],” said deputy supervisor Jill Doherty.