It might just be the ultimate act of forgiveness.
A new analysis of the city’s property-tax rolls found that religious institutions, wealthy private colleges, hospitals and other nonprofits — and even Madison Square Garden — are exempt from an astonishing $13.5 billion in property taxes.
The Independent Budget Office, which released the review yesterday, reported that, just in the last two years, an extra $1 billion in potential property taxes were placed off limits to city tax collectors.
“Some of the breaks are permanent, and may actually be more than estimated,” the IBO said, noting that the city’s tax assessors don’t have much reason to boost values on buildings they know to exempt.
The lengthy list of those living the zero-tax life ranged from nonprofit institutions ($2 billion in exemptions) to the MTA ($751 million) to Madison Square Garden, still enjoying the fruits of a sweet deal reached during the Koch administration that’s now worth $15 million a year.
Incentives for economic development offered through the Industrial Development Agency consumed $368 million in property taxes that might otherwise have been added to the city treasury.
Hospitals and other medical facilities were spared more than $515 million in taxes.
Private schools, colleges and universities saved $430 million in tax levies.
The city itself made the list since it owns more than 7,500 properties that could generate $5 billion in taxes in private hands.
As The Post recently reported, Deputy Mayor Stephen Goldsmith is examining the city’s holdings in lower Manhattan with an eye toward doing just that with a few buildings.
“This tells us that the city forgives a substantial amount of tax revenue for a variety of different reasons,” said Doug Turetsky of the IBO.
Some cash-strapped cities are becoming less forgiving, demanding that nonprofits cough up voluntary payments in lieu of taxes to cover some of the services they receive.
Yale University, for example, has long contributed million of dollars annually to the city of New Haven, Conn.
James Parrot, director of the Fiscal Policy Institute, said there’s no reason New York should be missing out.
“Especially given the incredible expansion of Columbia and NYU, they’re obviously beneficiaries of a lot of public services,” he said. “It would be very reasonable to ask them to contribute something.”
But even with the city facing a $5 billion deficit next year, that seems unlikely.
Mayor Bloomberg said it “would be like robbing Peter to pay Paul” because the city would have to provide public funds to help support groups if they didn’t get the tax breaks.
That hasn’t stopped the Sanitation Department from proposing to charge some nonprofits for garbage pickups next year to generate $17.2 million it needs to balance its budget.
Lost revenue
Due to property-tax exemptions, the city will be shorted billions.
NYC PROPERTY TAX
(Fiscal 2012 covering July 1, 2011 to June 30, 2012)
* Projected revenues: $17.6B
* Projected exemptions: $13.5B
WHO DOESN’T PAY
* State & federal governments: $701M
* MTA: $751M
* Foreign governments: $74M
* Hospitals and other medical facilities: $515M
* Private schools, colleges and universities: $430M
* Charities: $218M
* Cultural institutions: $103M
* Religious institutions: $627M
* Madison Square Garden: $15M
* “421,” a program for new developments: More than $1B
Source: Independent Budget Office