New York’s highest court issued a new ruling on Tuesday that could upend the way New York City collects billions of dollars in property taxes each year.
The state Court of Appeals sided with a coalition of homeowners and real estate industry groups — known as Tax Equity Now New York — who sued the city, claiming the property tax system sets far higher rates on rental buildings and small homes in lower-income neighborhoods than on condos and homes in wealthier areas.
In a 4-to-3 decision, the court said TENNY should be allowed to argue the current system violates the federal Fair Housing Act and real property tax law after lower courts dismissed their claims.
The judges also wrote that a number of city officials have criticized the way taxes are levied without doing anything about it.
“While these officials bemoan the situation, the city fails to act,” Judge Jenny Rivera wrote for the majority. “According to the complaint, the numbers tell the story of a taxation scheme that requires lower-income property owners and renters in majority-minority New York City neighborhoods to pay more than their fair share of the tax burden in violation of the law.”
The decision means the city will have to defend against the coalition’s claims that the tax system punishes people of color in low-income neighborhoods.
“Today is a great day for millions of New Yorkers who have been treated unfairly by the city’s unconstitutional property tax system,” said TENNY Policy Director Martha Stark, a former city finance commissioner, in a statement.
Still, it remains unclear how the city will respond to the ruling. Mayor Eric Adams’ office did not immediately respond to a request for comment.
Adams promised “real solutions” to the inequitable tax system while on the campaign trail.
“While we are still in the process of developing our own updated recommendations and analysis, we look forward to working with our partners in government and advocates to ensure the system is…
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