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Hilltowns Archives —The Altamont Enterprise, March 16, 2006

Westerlo looks for law to tighten regs for tax exemption

By Michelle O’Riley

WESTERLO — Westerlo residents and leaders are eager for the state to pass legislation concerning tax-exempt properties.

Aline Galgay, the town’s attorney, told the town board at its meeting last Tuesday there is a rising concern that the increased number of non-profit organizations buying tax-exempt property in the area will constitute a major loss of tax revenue for the town.

With changing vacation patterns in recent decades, mountain resorts, once popular for family vacations, have closed and are often sold to religious or other not-for-profit organizations.

Other concerns are that the current tax-exempt law does not specifically define how much profit these organizations can bring in and still be eligible for property-tax exemption. In addition, the town board would like to see new legislation passed that would place limitations on the number of acres that can be included under tax exemption.

Currently, the New York State Real Property Law authorizes an exemption from property taxes for certain not-for-profit organizations. The law states that the organization, its members and its employees, cannot receive profit. However, the law also states that there may be an exemption for the collection of profit if reasonable compensation for services performed furthers the organization’s purposes. This is where things get blurry, since reasonable compensation is not clearly defined.

The Westerlo Town Board members said that not-for-profit organizations in town are obviously bringing in money because advertisements for services they provide are posted locally. Attorney Galgay said that, as long as the profit from these activities are paying for the services being offered, then the organizations are really not profit-making. When asked if the town could amend this law, she responded that only the state, not the town, could adopt changes to the current tax-exemption law.
Currently, the law does not address limitations on the number of acres that can be claimed under tax exemption. It states only that any portion of the property that is not used for purposes such as religious or patriotic services is subject to full taxation. This is determined by how the organization describes the use of property on the application for tax exemption and a state property assessor’s review.

The town provides these tax-exempt properties with free services such as fire-fighting, emergency rescue, lighting, and in some cases waste removal, said board members. The board also pointed out that taxpayers, not the tax-exempt organizations, are paying for these services.

The town of Westerlo plans on working with other local towns to get new legislation passed. The tentative plan includes drafting a resolution from the towns urging the legislature to look more closely into the regulation of tax-exempt properties.

According to Galgay, a bill proposing such changes had been introduced but the status of that bill is unknown. "We are the ones being affected, you [New York State] need to do something about this," said Galgay.

Other business In other business, the town board:

— Discussed a request from the town’s judges to hold court one day a week. Currently, court is held on Monday and Thursday nights. Board members were concerned that one night would not be enough to handle the current caseload. Residents at the meeting asked if this would also mean a decrease in the judges’ salaries. It was decided that more information would be needed since any changes would also affect the court clerk and court bailiff;

— Discussed the renewal of a service contract with Mohawk and Hudson River Humane Society for the housing of animals picked up by the town’s control officer. If renewed, the town will pay $1,750, an increase of $1,000;

— Awaits a response from the state for approval to put a reduce-speed sign on Shultz Road;

— Discussed dates for a ribbon-cutting ceremony at the town park for the new water tank. Tentative dates are March 27, 28, 29, 30, and 31 as well as April 3, 4, 5, 6, and 7;

— Opened bids for materials for the highway department such as crushed stone and asphalt;

— Approved a change order from engineers for work in the water district and approved partial payment for an electrical contract. The board also renewed a service contract to maintain a generator and renewed a contract for emergency medical services and the purchase of a lift for the highway department; and

— Heard a proposal to purchase a new copier machine instead of renewing the existing copier’s service contract. The board also heard a proposal to purchase a new printer. According to Supervisor Richard Rapp, the current printer is "very, very, very tired." The board agreed to look into the actual cost to buy a new copier and printer.

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