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City Must Remove Nonprofits from Tax Lien Sale


garden tax lien sale

(photo: Sofie Hecht/Gotham Gazette)


In New York City, tiny, vulnerable, nonprofit organizations too often lose the real estate they own to for-profit developers. These unjustifiable losses are a complete mix-up of city and state tax policy, through the mechanism called the tax lien sale. New York City needs to fix this problem by removing nonprofits from the tax lien sale.

Nonprofits of various sizes -- religious institutions, universities, and community gardens alike -- frequently own property. These organizations, due to their nonprofit status, according to the New York State Constitution and New York State law and are tax exempt. Yet every year, New York City facilitates the sale of some of these properties to private speculative developers, and it is never the mega universities or big churches that end up in this mess, but small, local nonprofits.

New York City is correctly concerned with maintaining its tax base to keep the city functioning. In 1996, the Giuliani administration drastically changed the way the city deals with owners who don’t pay their property taxes out of concern for the lost tax revenue. One aspect of that change was the introduction of the tax lien sale for all property owners, including nonprofit owners even though they do not owe these taxes in the first place.

The tax lien sale works like this: if you, as a property owner, don’t pay your property taxes, the city places a lien on your property and sells it to a tax lien trust, an investment vehicle only rich ("accredited") investors can use. The trust then adds interest and fees and collects the "past due" taxes even when they were not technically due. If the property owner doesn't pay those fees, the trust initiates foreclosure and then sells to a buyer, usually a developer, at a post-foreclosure auction.

If you are a nonprofit owner, to avoid the tax lien sale you need to successfully apply for a tax exemption. When your tiny organization has a staff of two or three people, sometimes the administration is imperfect and you don’t file an exemption form when you acquire the property, which can lead to the loss of your property because of the tax lien system.

To continue avoiding the tax lien sale, your nonprofit needs to annually file a renewal form with the Department of Finance. So, if your community garden board misses a few pieces of mail because the former president retired and the new generation of garden caretakers doesn’t have every city agency sending mail to the right place, the renewal might not get filed. And the tax lien warnings may go unnoticed.

In a year or two, New York City thinks this property has a civic duty to pay taxes (which it does not) and is delinquent in that duty. The lien gets sold, and then your garden or church gets foreclosed. The worst case scenario happens when a developer shows up with court papers at your garden’s fence and tells you “we own this now and you must go.”

So, even though the state constitution provides for the exemption of property taxes for nonprofits, and even though New York law provides that your property is exempt from the date you acquire the property as a nonprofit, the City Department of Finance is still permitting the tax lien sales of nonprofits.

As D.W. Gibson reported earlier this year, the Black Veterans for Social Justice in Bedford-Stuyvesant, Brooklyn learned this year that tax debt on their property had been sold. Tax debt that, under state constitutional principle and state law, they do not owe. They are working on untangling this mess before their building ends up in foreclosure.

Tax revenue from property owners is an important piece of how the city functions. But this cannot be an excuse for seeing a small community nonprofit, especially in an already pressed neighborhood, fall into foreclosure.

The city should collect taxes from luxury real estate developers. The city should exert more muscle to collect fines from delinquent landlords who permit their buildings to collapse around tenants. The city should focus its hunt for lost revenue on the actual organizations that legally and morally should be paying it.

The rules around tax lien sales are up for renewal this year. New York City must exempt nonprofits from the tax lien sale altogether. New York City should not be seeking lost revenue from the most vulnerable populations. This problem can be fixed.

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Richard Semegram is a tenant lawyer and an advisory committee member of 596 Acres. On Twitter @richagram.

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Cuomo’s Tuition-Free Plan Must Be More Inclusive


Cuomo tuition-free college announcement

Gov. Cuomo (photo: Kevin P. Coughlin/Governor's Office)


Governor Cuomo’s plan to make tuition free for many New York State residents who attend SUNY or CUNY two- or four-year schools would be an exciting step toward ensuring students across the state can access New York’s prized public university systems. The newly-announced Excelsior Scholarship proposal could help 940,000 families who qualify for the state’s Tuition Assistance Program (TAP) with annual incomes less than $125,000. The program is designed to fill the gaps in tuition aid after state and federal grants have been used.

This is a big deal that New Yorkers should celebrate.

Yet, only increasing tuition aid is not enough alone to ensure true financial access. The proposal is a “last dollar” award, backfilling aid after state and federal grants, and therefore the program does not help low-income students who already have the full costs of their tuition covered by Pell and TAP but struggle to afford other expenses associated with earning a degree, such as books, child care, housing, transportation, and more.

In fact, non-tuition expenses make up the majority of the full cost of attending four-year and two-year public institutions. The Excelsior Scholarship program must come with a commitment to help cover these additional costs to allow students who enroll to actually stay in school, access the resources they need, and finish their degrees.

In addition to potentially leaving out the most at-need students who require more support than tuition coverage, the Excelsior Scholarship proposal turns a blind eye to some of New York’s neediest communities who would greatly benefit from a pathway to a free degree. Only students attending school full-time and who graduate on-time would be eligible to participate. This excludes part-time students, many of whom are balancing work and family responsibilities, requiring more than just free tuition to be able to attend college full-time. For the more than 84,000 undergraduate students at CUNY who attend part-time, representing almost 35 percent of undergraduate students, the Excelsior Scholarship falls short.

Another group excluded from this program are the more than 8,300 undocumented students currently attending SUNY or CUNY. The governor must hold true to his promises made to immigrant New Yorkers over the last few weeks by expanding the Excelsior Scholarship program to undocumented students and once and for all giving them access to state grants like the Tuition Assistance Program to access college.

The plan also claims it will increase on-time graduation rates by providing four years of tuition-free education, but we know being able to afford tuition doesn’t guarantee completion. It’s promising the governor is focused on improving graduation rates considering that less than 50 percent of four-year SUNY students and less than 30 percent of CUNY students graduate within four years. However, any plan to bolster timely completion must come with a commitment to significantly expanding opportunity programs that include academic and financial supports and services that support students while in school. This includes bringing to scale initiatives like CUNY’s Accelerated Study in Associate Programs (ASAP) to ensure that disadvantaged students from underserved communities can equitably access and make the most of a free public higher education when given the opportunity.

Addressing the cost of tuition is a critical step toward getting more young New Yorkers to complete college, but tuition is not the only barrier to success. To meet the needs of New York’s students, to make sure they get the skills and training needed to meet the demands of the economy and combat New York’s high young adult unemployment crisis, Governor Cuomo and state legislators need to expand this burgeoning plan to include the most vulnerable students.

The governor’s foundational investment and enthusiasm toward making college more accessible by making it more affordable is a promising step forward. However, we need to ensure this program is expanded to include those New Yorkers with the least access and with greatest challenges to earning a college degree.

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Kevin Stump is the Northeast Director for Young Invincibles, an advocacy and policy organization working on higher education, health, and jobs issues impacting 18-34 year olds. YI is also a part of President Obama's College Promise Task Force. On Twitter @KevinStump and @YoungInvincible.

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Protecting the Hudson: Federal-State Partnership or Conflict?


dec hudson river hudson falls upper hudson

Hudson Falls, upper Hudson River (photo: NY DEC)


Who is responsible for keeping the Hudson River free from pollution? Actually, it is a responsibility shared by Federal and State authorities. Sometimes they agree; other times, they may be at cross purposes. That can make for some interesting political debate and interplay between the federal and state governments.

Two current environmental issues are good examples.

Cleaning up PCBs in the Hudson
GE dumped PCBs, toxic chemicals resulting from its manufacturing facilities in Hudson Falls and Fort Edward, into the Hudson for many years. Most of the chemicals settled to the bottom but some drifted downstream. They were ingested by fish, leading to a ban on eating fish caught in the river. After years of controversy and discussion, GE agreed to pay for dredging the river from Fort Edward to Troy, under supervision of the Federal Environmental Protection Agency (EPA) as a federal Superfund project. Dredging work began in 2009 and concluded in 2015 with the removal of some 310,000 pounds of PCBs. GE called it a "major environmental success" and declared it had met its cleanup responsibilities.  

EPA monitored the work and expressed satisfaction as it went along. EPA is scheduled to test sediment and fish mostly near the site once more in 2017 and then was expected to certify that GE had met its obligations. When the dredging concluded in 2015, EPA allowed GE to dismantle its PCB processing plant at Fort Edward with the implication that the work was done. The Cuomo administration did not object. Political pundits pointed out that at the time the administration was trying to convince GE to move its headquarters from Connecticut to New York. GE ended up moving to Boston instead.

But the PCB issue is not resolved.

In strongly-worded letters to the EPA in November and December, 2016, New York State Department of Environmental Conservation (DEC) Commissioner Basil Seggos expressed "significant concerns" and asserted that "EPA's work is not done." The river is still "much more contaminated than EPA originally predicted." He added, "it is clear that the dredging performed will not meet...targeted fish PCB concentrations and EPA will not be able to deliver on the projected benefits to public health and the environment from this cleanup unless additional actions are undertaken." Much more sampling and testing are needed, along the entire length of the river from Fort Edward all the way to New York City.

"It's simple," Seggos explained. "DEC is calling on the EPA to finish the job and hold GE accountable for cleaning up the Hudson River. If EPA won't do the job and protect New Yorkers and the environment, DEC is ready to step in and lead."

The war of words escalated in December. EPA Regional Administrator Judith Enck wrote Seggos on December 21 to say, "we strongly disagree" with the "baseless accusation" that EPA has not done its job. She rejected his demand for additional sampling beyond what EPA was already planning, adding that "NYSDEC is free to pursue that sampling itself if it so chooses."

EPA will make its decision early this year on whether GE needs to do more dredging.

Keeping oil off the Hudson
A consortium of maritime and oil companies has proposed construction of 10 "anchorages"  along the shores of the Hudson River, from Kingston to Yonkers, to store large barges carrying crude oil south from Albany. The anchorages would include a total of 40 berths, or parking spaces, for the ships. The proposal resulted from a decision by Congress last year ending a ban on export of oil produced in the lower 48 states.

Proponents say that the action by Congress will increase the amount of oil moving by rail to the Port of Albany and then down the Hudson by boat. Their proposal will produce jobs, help lower energy costs, and boost the economy, they say.

Opponents counter that the anchorages are unnecessary and will cause environmental damage to the river.

The U.S. Coast Guard has legal responsibility for reviewing and deciding on the proposal. It has received more than 10,000 comments from interested citizens, environmental groups, local governments, and others.

New York state government weighed in with two long letters in December.

A joint letter to the Coast Guard from the New York Secretary of State, Department of Environmental Conservation, Public Service Commission, and Office of Parks, Recreation and Historic Preservation, set forth a long list of concerns about the proposal and called for more study, concluding that the proposal "lacks sufficient justification and detail." The state agencies expressed concern about the number of anchorages, lack of specificity about how many barges would be accommodated or how long they would stay, impact on state parks and other state-owned lands, the risks of accidents and spills, and the impact on fish, particularly two species of endangered sturgeon that inhabit the Hudson. But they couched their reservations not as outright opposition but instead mostly in terms of assertions that there needs to be lots more study and consultation.

Attorney General Eric Schneiderman, who sometimes makes a point of expressing positions on public issues that are independent from those of the Cuomo administration, sent his own letter, not to the Coast Guard but to the head of its parent agency, the Secretary of Homeland Security.

Schneiderman asserted that the Coast Guard should discontinue consideration of the proposal until it is reviewed by the U.S. Army Corps of Engineers, which Schneiderman asserts is required by law. But he went on to express more direct opposition than his colleagues in the other New York State agencies. “No one has demonstrated a manifest need for so many new anchorage sites along the river; no one has demonstrated a need for long-term anchorage at any of those specific locations...." The barges "would create significant security and hazard risks" particularly since the anchorages "would essentially allow barges to serve as oil storage facilities on the river,” he wrote.

The Coast Guard will decide on the barge anchorage proposal early in 2017.

The Hudson River and public policy
The Hudson River's extraordinary historical importance magnifies the importance of these issues. "Far more than a short river flowing through New York State, the Hudson is a thread that runs through the fabric of four centuries of American civilization -- its culture, its community, and its consciousness," wrote Tom Lewis in The Hudson: A History. It is "the valley where nature's creation and human creation meet, the river that connects so much of America's past with its present and future, unchangeable in presence yet always changing."

The PCB and oil barge issues illustrate a number of themes. Public opinion recognizes the commercial importance of the Hudson River. But people seem more concerned these days with the river's historical, aesthetic, scenic, and recreational values. Commercial exploitation has been at least partially upstaged by insistence on preservation for public benefit. There is a consensus that public authorities need to enforce policies to keep the river clean and, to the degree practical, that polluters need to clean up their pollution under government supervision.

But major policy decisions turn primarily on scientific evidence, and some imprecision is inevitable. When has there been "enough" dredging of PCBs? How much harm will giant oil barges cause to protected fish habitats? When federal and state perspectives and standards differ, which should prevail? How should economic and commercial benefits be balanced against environmental concerns?

These questions will be debated as the two issues discussed above play out in 2017. They are judgment calls that, inevitably, whether we admit it or not, are tinged with political considerations. But they are the sorts of issues that will continue to reverberate in environmental discussions here in New York, and indeed across the nation, in coming years.

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Dr. Bruce W. Dearstyne's latest book is The Spirit of New York: Defining Events in the Empire State's History, published in 2015 by SUNY Press.

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