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Volume 8 - Opinions of Counsel SBEA No. 107

Opinions of Counsel index

Cancellation of taxes (unenforceable lien) (levy on personal property) - Real Property Tax Law, §§ 102(12)(d), 300, 558:

A tax levied upon personal property is void and unenforceable and may be cancelled by a county legislative body pursuant to section 558 of the RPTL.

The outside plant of a cable television system, other than tangible property of a special franchise, is personal property.

The courts have concluded that “outside plant” of a cable television system (i.e., the lines, wires and poles not subject to assessment as “special franchise”; see, RPTL, § 102(17)) is not assessable pursuant to either section 102(12)(d) as “telephone . . . lines, wires and poles”, or section 102(12)(e) as “mains, pipes and tanks permitted . . . to be placed under any public or private street” (Cablevision Systems Development Co. v. Board of Assessors of County of Nassau, 98 A.D.2d 818, 470 N.Y.S.2d 37 (2d Dept. 1983); and, American Cablevision of Rochester, Inc. v. Jacobs, 101 A.D.2d 65, 474 N.Y.S.2d 653 (4th Dept. 1984); see also, 8 Op. Counsel SBEA No. 85). As personal property, cable television outside plant may not be the subject of an ad valorem tax (RPTL, § 300). Therefore, an entry of assessed value for cable television outside plant property on the taxable portion of an assessment or tax roll would constitute an unlawful entry as that term is defined in section 550(7)(c), since an assessor has no authority to assess personal property. If this type of error is not discovered and corrected prior to the expiration of the tax warrant (RPTL, § 554), and the tax is not paid (RPTL, § 556), it is not administratively correctable unless it fits within the scope of section 558 of the RPTL. {*}

Subdivision 1 of section 558 authorizes a county legislature to cancel any unpaid tax levied or imposed against property of New York State or the United States “where it is determined that the lien of such tax cannot be enforced.” As discussed in 8 Op. Counsel SBEA No. 44, by amendment in 1977 (c.622), this authority was also extended to instances of unpaid taxes “rendered permanently unenforceable by operation of the provisions of any statute.” According to the sponsors of this 1977 legislation, examples of statutes rendering collection of a tax permanently unenforceable include RPTL, §418 and section 52 of the Public Housing Law as judicially interpreted in Rochester Housing Authority v. Sibley Corp., 77 Misc.2d 205, 351 N.Y.S.2d 934 (Sup. Ct. Monroe Co., 1974), aff’d, 47 A.D.2d 718, 367 N.Y.S.2d 969 (4th Dept. 1975). These statutes specifically grant an exemption as of the date of acquisition, even if subsequent to taxable status date. Therefore, any tax levied on such property will be unenforceable, even though the property may not have been exempt from taxes on taxable status date.

It is our opinion that the authority granted by the plain language of section 558 goes beyond those instances cited by the legislative sponsors. In this situation, there is no issue of a real property tax exemption. Rather, the issue is the classification of the cable TV property itself; whether it is real property subject to taxation. By both case law and legislation (L.1985, cc.71, 72 and 463), cable television transmission equipment has been removed from the category of real property for tax purposes and, therefore, it is not subject to ad valorem taxation (Sunnycrest Apartments, Inc. v. Srogi, 100 A.D.2d 730, 473 N.Y.S.2d 660 (4th Dept. 1984)).

It seems self evident that a purported lien for unpaid real property taxes imposed upon personal property would be permanently unenforceable. Accordingly, in our opinion, taxes may be cancelled in accordance with the process set forth in section 558 of the RPTL if the property is excluded from the definition of real property as set forth in RPTL, section 102(12)(i).

September 12, 1986

NOTE: The 1985 legislation cited in this Opinion (L.1985, cc.71, 72 and 463), in part, codified the Appellate Division decisions cited at the outset. Although that legislation expired on December 31, 1986, the principle that the outside plant of a cable television system is not real property was permanently codified in 1987 (RPTL, § 102(12)(i); added L.1987, c.416).

{*}  If the tax is paid, an application for a refund filed in accordance with the procedures set forth in section 556 of the RPTL is the appropriate remedy.