Dinkins names tax reform panel.

Months after a blue ribbon panel was supposed to have begun hearing testimony on property tax inequities, New York City Mayor David N. Dinkins and City Council Speaker Peter Vallone have come to an agreement on the commission members.

The seven-member Property Tax Reform Commission, announced last week, will be chaired by Stanley E. Grayson, a former city Finance Commissioner who is currently a vice--president at Goldman Sachs and a member of the State Board of Equalization and Assessment. Acting Finance Commissioner Kathleen Grimm Columbia Law School Professor Richard Briffault, who served as a consultant to the New York City Charter Revision Commission; Roderick Chu, a partner at Anderson Consulting and a former state commissioner of Taxation and Finance; Anthony Gliedman, president and chief executive officer of AMREP, a builder of affordable housing and a former commissioner of the Department of Housing Preservation of Development; and Muriel Siebert, president of Muriel Siebert & Co. and former State Superintendent of Banks.

The group is preparing to meet by the end of September before holding a series of public hearings. Their mandate by local law is to examine and improve the New York City real property tax system and present proposed reforms to the State legislature by the 1994 session.

The commission is to propose reforms to treat all residential properties equitably, including increasing tax relief for low-income and/or elderly persons; assure that all properties within each class are assessed at the same percentage of market value; and determine the appropriate treatment of commercial and utility properties.

In a statement, Mayor David N. Dinkins said the commission will strive to build consensus for changing the laws., agreeing the system is "plagued with legislated inequities."

Council Speaker Peter S. Vallone was the primary sponsor of the bill to form the commission. The idea came out of the back-room bargaining with the state legislature in July of 1992 when they agreed to legislatively shift tax burden from the Class II multi--family dwellings. This was done to get around the new equalization rate that could have raised the Class II tax share by nearly nine percent.

Vallone said in the statement, "Co-op and condo owners are home-owners just as much as the more traditional owner of a one-, two- or three-family residence. All homeowners need to be treated equitably. This commission will propose how to do [that] and how to simplify the entire property tax system.

Industry group leaders who had been told the commission would not be pulled from their ranks and were, therefore. concerned about having a panel conversant in real property tax law. were unanimously pleased with both the competency and the impartial makeup of the commission.

Steve Spinola, president of the Real Estate Board of New York, noted the members appeared to have experience in this area and did not come from any one particular side. "They are knowledgeable and I am optimistic that the committee will be looking at this in a fair and intelligent way."

Martin Karp, chairman of the Action Committee for Reasonable Real Estate Taxes, said they were prepared to submit their information and work with the panel constructively, providing any information they could.

"We're pleased that it finally happened," said, of last week's announcement.

Joel R. Marcus, president of the Tax Review Bar Association observed the city administration is well aware of the inequities in the system.

"They could just as easily have set forth some proposed legislation for public comment," noted Marcus. "I don't want to prejudge the work of the commission, however, and I look forward to working with them. "

Class IV commercial property owners have been worried that in an effort to help apartment unit owners, they would once again be asked to bear the brunt of another property tax class' relief.

"We are all subsidizing the Class I's," said Jeffrey R. Gural, president of Newmark & Co. and co-chair of the Property Tax Fairness Coalition, also agreeing the panel is a step in the right direction. All these politicians don't have the guts to do what is right. I know some of the people and others by reputation and hopefully they will look into what is obviously an unfair system. "Gural, who confessed to once having been "subsidized" as a Staten Island homeowner for 20 years, said every other property owner is subsidizing the homeowners. "I don't see why someone who lives in a co-op shouldn't be protected and someone who lives in a house should be protected," he said. "It should&t happen overnight but if we bring them up over 10 years. it should work. "

The apartment building owners are also quietly worried that they will end up subsidizing unit owners as well as the homeowners and their own rent stabilized and rent controlled tenants.

Dan Margulies, executive director of the Community Housing Improvement Program (CHIP), said the panel's job is difficult because property tax experts come up with the same conclusions.

"What these people have to do is not only reach the conclusion that it has to be shared more equitably, particularly by Class l," Margulies explained, "but they have to make the recommendations that are necessary in a politic manner. "

Margulies, however, believes this commission is a stalling tactic" to take the political heat off a sensitive subject until after the elections. "These are the kind of people that can deflect that," he hoped. "The bottom line is you can protect Class One if you bring down city spending enough, and that will help all the other classes as well.'

Jack Freund, acting president of the Rent Stabilization Association (RSA), said they too were pleased with the appointment of such a distinguished panel of experts in the fields of finance, real estate and taxation. "If New York City's tax system can be rationalized, this panel ought to be able to do it," he said.

Cooperative representatives were hopeful their current plight of paying many times more in property taxes than a similarly valued homeowner would be corrected. They also believe politicians are beginning to recognize the unit owners as a strong voting block.

Mary Ann Rothman, executive director of the Council of New York Cooperatives said, "We're delighted to learn a blue-ribbon commission has finally been announced. We wish them speed in quickly organizing to work for property tax fairness."

If the panel approaches the problem and looks at all of the facts, something good should come out of it, said Irwin Gumley, president of Gumley-Haft and the Apartment Owners Association. "Anybody who looks at this question will realize it requires adjustment," he noted, adding that as time goes on the disproportionate nature of the problem becomes greater as assessment shifts occur.

The real property tax is the city's largest revenue source, generating $8 billion annually. The present classification and transitional assessment system, known as S7000A, was enacted in late 1981 by the legislature when it voted to repeal a 193-year old full value assessment statute and overrode a veto by then Governor Hugh Carey.