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Volume 3 - Opinions of Counsel SBEA No. 42

Opinions of Counsel index

Housing exemption (project owned by municipality) (liability for sewer assessments) - Public Housing Law, § 52:

Federally aided housing projects belonging to a municipality are liable for sewer assessments, which are levied on a benefit basis to pay for local improvements and are not “taxes” pursuant to section 52(3) of the Public Housing Law.

Our opinion has been requested as to whether two federally-aided housing projects owned by a town housing authority are liable for charges imposed on behalf of a town sewer district and the county sewer district.

          We are unable to determine with certainty whether the charges are “special assessments” or “special ad valorem levies” as those terms are defined in section 102 of the Real Property Tax Law. For the purposes of our opinion, we will assume that they are either one or the other. Also, insofar as the liability of the projects are concerned, we believe it is immaterial which type of charges they are. Both of these charges are what were called “assessments for local improvements” in statutes and case law prior to the enactment of the Real Property Tax Law in 1958.

Subdivision 3 of section 52 of the Public Housing Law provides that the property of a municipally or federally aided housing authority “shall be exempt from all local and municipal taxes.” Other provisions in this subdivision authorize a municipality to agree to make payments in lieu of taxes, that is, payments in lieu of the taxes which would have been payable but for the exemption.

We believe that the key language determinative of the liability of the housing projects is that quoted above, rather than the language contained in subdivision 1 of section 52. (In any event, the answer would be the same since the word “fee” has never covered charges which are in the nature of a tax. It normally refers to charges which are contractual.)

The cases cited in our opinion on industrial development agencies (1 Op.Counsel SBEA No. 23), plus others to be referred to hereinafter, clearly establish that the words “taxes” or “taxation” in exemption statutes do not include assessments levied on a benefit basis to pay for local improvements, regardless of what they are called. Other cases are cited in a 1953 opinion of the Attorney General (1953, Op.Atty.Gen. 118).

The Attorney General was of the opinion that a state-aided housing project was not exempt from the sewer charges of a town sewer district under the language of subdivision 4 of section 52. The language in that subdivision is even stronger since it refers to “special district taxes.”

Therefore, it is our conclusion that the housing projects are liable for the sewer assessments.

We would, however, review this question should it be discovered that the sewer charges were levied on behalf of a district, the boundaries of which are coterminous with the boundaries of the town or of its unincorporated area (Christ Church v. Town of Eastchester, 197 Misc. 943, 99 N.Y.S.2d 991; Cooper Union v. City of New York, 272 App. Div. 438, 71 N.Y.S.2d 204, aff’d, 298 N.Y. 578, 81 N.E.2d 108).

April 20, 1973