Realtors Lobby Against Transfer Tax Bill

In the next weeks and months, the battle over the transfer tax proposal will most likely pit the business and real estate sectors against the environmental lobby in the state. Participants in the New York State Association of Realtors Annual Lobby Day in Albany met with state lawmakers to express their opposition to the bill entitled "Community Preservation Act" authored by State Sen. Carl Marcellino and State Assemblyman Thomas P. DiNapoli.

Under current law, local towns can enact a transfer tax; however, they must obtain approval from the legislature to enact such a measure. The Marcellino/DiNapoli bill would allow the establishment of a transfer tax after a town-wide "Home Rule" referendum without the approval from the legislature.

Duncan R. MacKenzie, director of governmental affairs for NYSAR, told Realtors that the transfer tax is too selective since only the buyers of real estate would pay the tax. He says that such a tax would increase the cost of housing and would be like "putting out an unwelcome mat" for businesses and families looking to move to New York.

Henry W. Fries, chairman of the Westchester County Board of Realtors Legislative Political & Legal Affairs Committee, said the tax would be paid by less than 5% of the population (the buyers of real estate). He added that the tax would be a significant burden to an already high-cost area. He noted that in the past two years Westchester County government has raised property taxes approximately 32% and also recently imposed a 25% hike in the mortgage recording tax in Westchester County.

Realtor organizations are not the only business group coming out against the transfer tax bill. The Business Council of New York State on Tuesday issued a position statement against the bill, stating that the existing state real property transfer tax pumps in approximately $67 million a year into the state's Environmental Protection Fund that is used for open space acquisition.

Elliott Shaw, the Business Council's director of government affairs, stated, "Enacting a tax that would allow local municipalities to increase the cost of commercial and residential taxes would definitely harm the state's economic health. It sends a message to businesses and individuals that New York is closed for business."

However, a host of environmental advocacy organizations have expressed their support for the transfer tax measure, including Scenic Hudson, the New York League of Conservation Voters and the Open Space Institute.

National Resources Defense Council scientist Robin Marx expressed the organization's support of the measure by stating, "The major threat to the 19 reservoirs that provide water to nine million New Yorkers is haphazard development and suburban sprawl in the watershed." Marx said many watershed communities, especially in Westchester and Putnam counties, have sought the council's help in protecting watershed land in their towns from development. "This proposed legislation, which would give local communities the option to raise funds for open space protection, could be a very effective tool for these communities to protect watershed land for future generations."