63 N.Y.2d 442 (1984)

The State Board of Equalization and Assessment’s role in assessing state forest lands is limited to ensuring the local assessor’s assessment aligns with the applicable equalization rate; valuation authority rests with local assessors.

Summary

The Town of Shandaken, located within a forest preserve, challenged the State Board of Equalization and Assessment’s (SBEA) approved assessment of state-owned forest lands. The town argued that its own assessment should be conclusive. The Court of Appeals affirmed the Appellate Division’s decision, holding that the SBEA’s authority is limited to ensuring assessments align with equalization rates. The power to determine valuation lies with the local assessors, and the SBEA cannot substitute its valuation for that of the local assessors. The court emphasized the clear language of Real Property Tax Law § 542.

Facts

The Town of Shandaken contains a significant amount of state-owned forest land. In 1981, the Town’s assessors filed a tentative tax roll, valuing the state lands at $19,874,655. The SBEA, after initially determining a lower valuation of $15,899,720, approved an assessment of $16,516,600. The Town then initiated legal action, contending that the SBEA exceeded its authority and that the Town’s assessment should be approved.

Procedural History

The Town commenced an Article 78 proceeding, which Supreme Court converted to a declaratory judgment action, ruling in favor of the SBEA. The Appellate Division modified, declaring the SBEA’s procedures violated Real Property Tax Law § 542 and that the Town’s assessment was conclusive. The SBEA appealed to the Court of Appeals.

Issue(s)

Whether the State Board of Equalization and Assessment has the authority to determine the valuation of state lands for assessment purposes, or whether its authority is limited to approving assessments based on the applicable equalization rate.

Holding

No, because the authority of the State Board of Equalization and Assessment (SBEA) is limited to ensuring that assessments of state lands conform to the applicable equalization rate, while the authority to determine the initial valuation of such lands rests with the local assessors.

Court’s Reasoning

The court based its decision on the plain language of Real Property Tax Law § 542. The statute mandates that state lands be valued as if privately owned and assessed at the same percentage of full valuation as other taxable real property in the assessing unit. The court emphasized that the assessors must notify the State Board of their assessment amount, and that the State Board must then approve the assessment. The approval must be “in such an amount as will place it at the same percentage of full valuation as other taxable real property in the assessing unit.” The Court stated, “Nothing in the statutory prescriptions grants initial or final valuation authority to the State Board; its authority is only to assure that the final assessment conforms to the applicable equalization rate.” The court rejected the SBEA’s argument that past practice justified its actions, stating, “That, as the State Board asserts, past practice has varied from the pattern of the statute does not warrant our disregard, when we are called on to consider the issue, of the explicit language of the statute”. The court also noted that when the Legislature intends to grant the SBEA original authority to determine valuation, it explicitly does so in the statute (citing Real Property Tax Law, § 600). The Court further elucidated that the local assessors are responsible for the initial valuation, with procedures for judicial review under Article 7 of the Real Property Tax Law, while the State Board is responsible for ensuring conformity with the equalization rate, a rate that the State Board itself determines. The court underscored that if the Legislature intended for the SBEA to have valuation authority, it could amend the statute to reflect that intention.