Amherst eyes closing tax breaks for condos
Patio homes may be assessed at full value
Amherst town officials continue to push a measure that would close the state’s “condominium tax loophole,” which allows patio homes and other upscale residences in town to qualify for huge tax breaks.
Monday, Supervisor Satish Mohan and Council Members Mark Manna and Shelly Schratz announced support for a “homestead” taxing system that would require certain condos to be assessed at full-market value and taxed like regular, single-family homes.
A resolution calling for the adoption of the homestead tax option would be considered at the board’s next meeting Monday.
“I think we public officials owe it to all the residents of the Town of Amherst to do everything we can to close this condominium loophole or severely diminish its affects,” Manna said.
Condominiums have come under fire in Amherst because more developers are styling them as high-end, stand-alone houses that closely resemble single-family homes but qualify for property tax breaks of 40 to 50 percent.
While condos have always existed in Amherst, public officials started expressing outrage when patio homes started selling for huge sums.
“If you can afford $1.6 million for a home, I believe you can afford those taxes,” Schratz said.
The state’s homestead provision was created in 1981 to address a taxing inequity between residential and commercial properties. But some town officials want to apply this two-tiered taxing system to force some condominium owners to pay a bigger share of taxes and ease the “unfair and inequitable” tax burden of other homeowners.
If Amherst became a homestead district, certain condo developments — including all patio homes — would be assessed at full-market value for town and school tax purposes. Condominiums originally built as apartments and later converted to condos would be exempt.
Town Assessor Harry Williams said the town has about 5,500 condominium units. About 2,000 of them would be subject to the higher taxes as a result of the homestead law, if adopted, he said.
Some board members have expressed ongoing reservations about whether the complicated homestead tax option is really the best choice for closing the condo loophole.
Council Member Guy Marlette submitted a counter resolution directing town administrators to provide extensive data regarding the financial impact of the changeover to a homestead system before the board makes “a rush to judgment.”
Sam Leone, president of the Forest Condominiums Association, which represents 92 condo owners along Hopkins Road, denounced the homestead resolution Monday. He said the new law would affect far more than patio homes, including 20-year-old developments like his.
Condo owners pay a premium for their condominium designation, as well as monthly association fees to cover maintenance of their private roads, yards and infrastructure, he said. If these owners are also forced to pay full taxes, he said, their property values would plummet.
“We’re going to drop 40 to 50 percent overnight,” he said, later telling council members he didn’t know how they could sleep at night if they passed such a harmful resolution.
Schratz said the homestead tax option holds merit, but she is also continuing to work with assessors and developers countywide on a compromise proposal. It would assess condominiums at full-market value but give condo owners a limited tax exemption in recognition of the private services they pay for through their association fees.
