The Recorder

Aldermen consider proposal to widen user fee abatement

Amsterdam 5th Ward Alderman James Martuscello discusses Monday a local law he has proposed to expand user fee abatements in the city.

Amsterdam 5th Ward Alderman James Martuscello discusses Monday a local law he has proposed to expand user fee abatements in the city. Photo by John Purcell/Recorder

Recorder News Staff

A proposal to widen eligibility for the city’s user fee abatement has gotten even wider to include commercial and industrial properties along with adding single unit residential homes.

Fifth Ward Alderman James Martuscello presented his proposed local law to amend the city code to allow for user fee abatements to include single-unit residential properties and commercial or industrial properties. The existing law allows owners of multiple-unit residential property to apply for a temporary exemption from per-unit charges for water, sewer and garbage user fees if certain conditions are met.

Martuscello said his proposed amendment would make “everything fair” and encourage people to buy property in the city.

“The whole purpose of this is when people buy property in the city of Amsterdam through auction if they make a serious effort to put money into it, the abatement is their savings,” Martuscello said. “By not paying the water, sewer and garbage, they take that money and put it in toward the house.”

First Ward Alderman Edward Russo agreed the abatement should be expanded to be fair to people who purchase properties falling outside of existing regulations.

Martuscello said the city also does not want properties returning to the foreclosure auction block in the future, so the abatement helps facilitate investment while avoiding potential demolition expenses.

Deputy Mayor and 3rd Ward Alderman Chad Majewski was supportive of the revised regulations, because it could spur more investment in the city. Majewski said the user fee exemption would only be temporary.

The revised regulations would only grant an abatement for a unit with an active, approved building permit for work estimated to exceed $7,500 per residential unit, or $10,000 per a commercial or industrial unit, and causes the unit to be vacant or uninhabitable for more than two months during construction.

Martuscello increased the estimated work costs for a residential unit by $2,500, along with adding the required costs for commercial and industrial units, for the amended regulations. A commercial or industrial unit would be excluded from paying its metered user fees as opposed to a residential unit flat-fee.

The exemption is applied to the balance of quarterly user fees not yet due for the fiscal year as of the date an abatement is granted, along with fees for the entire next fiscal year. If the property was purchased from Amsterdam within two years of filing an exemption application, the abatement period will be extended to two additional tax years, according to the law.

The abatement does not apply to property taxes, which would be due as normal.

A lingering question remains whether the expanded abatement is effective going forward or if there could be some type of retroactive eligibility offered.

Martuscello said he would like to apply the expanded abatement retroactively, but some aldermen expressed apprehension.

“The more people you can get on this the better,” Martuscello said. “I want to give people incentive to do something with the house that they purchased.”

Corporation Counsel William Lorman said the local law could be applied retroactively, but he was unsure whether retroactive eligibility was wise for the city. “You could do it, but I don’t know if you really want to do it,” Lorman said.

Majewski suggested any application for an abatement to be applied retroactively could be granted on a case-by-case by the city council. Majewski said he wished the regulations had been amended prior to recently held foreclosure auctions.

If a property owner granted an exemption fails to complete the work authorized in their building permit, all abated fees must be paid back to the city, according to the law. Forfeited fees also become a lien on the property.

Renting or permitting occupancy of an abated unit is illegal for a property owner unless the building permit is closed. A property owner found breaking this law would be committing a misdemeanor offense punishable by a fine of up to $1,000 or up to one year in jail, or both.