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Volume 6 - Opinions of Counsel SBEA No. 95

Opinions of Counsel index

Municipal corporations exemption (vacant land) (infrequent use for fund raising events by private organizations) - Real Property Tax Law, § 406:

Vacant land owned by a village and located within its boundaries is not entitled to exemption pursuant to section 406(1) of the Real Property Tax Law where the property is used only three or four times a year for fund raising bazaars by such organizations as the local fire company and the VFW.

Our opinion has been requested concerning the taxable status of certain unimproved land located in a village. This land is owned by the village and has remained vacant since its acquisition. The village allows local groups including a fire company and a Veterans of Foreign Wars post to conduct fund raising bazaars on the property. This activity is the sole use to which the property is put, and it occurs only three or four times a year. We have been asked whether the property should be listed as exempt from taxation on the assessment roll of the town within which the village is located.

Subdivision 1 of section 406 of the Real Property Tax Law provides an exemption from taxation for real property owned by a municipal corporation within its corporate limits if such property is held for a public use. The phrase, “held for a public use” is not defined in the statute, but it has been the subject of judicial interpretation.

In the case of Herkimer County v. Village of Herkimer, 251 A.D. 126, 295 N.Y.S. 629, aff’d, 279 N.Y. 560, 18 N.E.2d 854, the court said:

“Held for public use,” in this connection, means that the property should be occupied, employed, or availed of, by and for the benefit of the community at large, and implies a possession, occupation and enjoyment by the public, or by public agencies. 295 N.Y.S. at 634.

If municipally owned property is unused, it is not “held for a public use” within the meaning of section 406 (Long Island Land Research Bureau v. Town of Hempstead, 283 App.Div. 663, 126 N.Y.S.2d 857). Similarly, if use of the property is infrequent or de minimis, it does not qualify for the municipal corporations exemption (see, Village of Watkins Glen v. Hager, 140 Misc. 816, 252 N.Y.S. 146, wherein the court denied exemption for property, the sole public use of which was storage of some obsolete fire apparatus and discarded highway maintenance equipment). The property in question appears to be taxable pursuant to this principle, since it is used on only a few occasions per year.

Further, the use of this property is not sufficiently public in nature to render the property exempt under section 406. Although the performance of activities by private organizations does not necessarily remove the right to the municipal exemption, case law holds that the private parties using the property must be performing a municipal function which a state law authorizes the owning municipality to perform (see, e.g., Town of Harrison v. Westchester Co., 13 N.Y.2d 258, 196 N.E.2d 240, 246 N.Y.S.2d 593 [operation of an airport]; People ex rel. Mayor v. Board of Assessors, 111 N.Y.505, 19 N.E.90 [operation of a ferry]; People ex rel. I.R.T. Co. v. State Board of Tax Commissioners, 126 App. Div. 610, 110 N.Y.S. 577 [operation of a subway]).

The described use of the subject property is not a municipal function. We have said that the use of village owned property for the provision of fire protection services by the village fire department is a public use within the meaning of section 406 (5 Op.Counsel SBEA No. 107). However, the conduct of fund raising bazaars on a very infrequent basis is not sufficiently related to fire protection activities to be characterized as a public use (see, also, Fallica v. Town of Brookhaven, 69 A.D.2d 572, 419 N.Y.S.2d 102 regarding public use). In any event, the infrequency of such use and the use of the property for clearly non-public activities such as VFW fund raising events renders the property ineligible for exemption pursuant to section 406.

September 20, 1979