Small-home owners in Carroll Gardens and Park Slope are saving an average of $10,760 per year on their property-tax bills — the biggest benefit outside Manhattan — thanks to byzantine rules, an analysis has found.
The savings are largely due to caps on tax hikes for one-, two- and three-family homes enacted decades ago.
“New York’s complex and opaque property tax is riddled with inequities and inefficiencies,” said a report by the nonpartisan Citizens Budget Commission.
“Because the rate of property-appreciation varies among neighborhoods, these rules generate significant differences in [effective tax rates] across properties of the same value in different neighborhoods.”
Among the outer-borough beneficiaries of the wacky system is Mayor de Blasio, whose modest Park Slope home has doubled in value — to $1.4 million — over the last eight years.
If he saves the neighborhood average, he’ll have enough to cover 7¹/₂ years of daily small soy lattes at Starbucks — to use the parlance of the times.
Homeowners in nearby Brooklyn Heights and Fort Greene saved nearly as much, at $10,536 on average.
In Manhattan, the top benefit went to owners in high-priced Greenwich Village, who paid an average of $39,680 less in taxes than if there were no cap, according to the report.
Five other Manhattan neighborhoods saw savings in fiscal 2013 that ranged from $22,566 in Stuyvesant Town and Turtle Bay to $37,900 on the Upper West Side.
In Harlem, homeowners pocketed $8,226 on average, while those in the Williamsbridge and Baychester parts of The Bronx saved the least, just $313.
The CBC report offered three reforms that would allow the city to increase its property-tax intake by $2 billion, even though the mayor has pledged not to raise the tax.
One option would be to raise taxes across the board.
That would preserve disparities across neighborhoods and home types — since small-home owners pay a lower rate on average than other property owners.
A second option would be raising taxes on small-home owners, while lowering the tax rate on co-op and condo owners to the same level.
The final option would essentially eliminate the tax caps and similar protections, which the CBC says would generate $4.5 billion in additional revenue in fiscal 2015 alone.
Last last month, lawyers for two tenants in large apartment complexes filed a lawsuit against the city claiming the property tax system wasn’t just convoluted, but discriminatory.
They argued in a Manhattan Supreme Court filing that the higher tax rates on large buildings are passed down to renters — who are mostly black and Hispanic.