56 N.Y.2d 356 (1982)

A CPLR article 78 proceeding is the appropriate method for tax districts to seek judicial review of transition assessments set by the State Board of Equalization under Real Property Tax Law § 545, ensuring proper calculation and distribution of state aid.

Summary

The Towns of Arietta, Benson, and Lake Pleasant challenged the State Board of Equalization and Assessment’s calculations of transition assessments for state-owned forest lands. These assessments are designed to prevent significant tax revenue loss when the state acquires land. The towns argued the board incorrectly calculated the assessments, leading to revenue loss. The Court of Appeals held that an Article 78 proceeding is the proper method for challenging these calculations and that the 1968 transition assessments should have been based on 1967 assessments, affirming the lower court’s grant of summary judgment to the towns.

Facts

The Towns of Arietta, Benson, and Lake Pleasant contain substantial state-owned forest lands subject to local real property tax. In 1961, the State Board of Equalization and Assessment significantly reduced the assessed value of these lands, triggering the application of transition assessments under Real Property Tax Law § 545. The towns claimed that the State Board approved transition assessments for 1968 in amounts less than those prescribed in section 545, resulting in a loss of tax revenue and lowering of tax and debt limits.

Procedural History

The towns initiated Article 78 proceedings challenging the State Board’s transition assessments for the years 1968-1978. Special Term dismissed the petitions. The Appellate Division reversed the dismissal for the 1968 proceeding, reinstated the petition, and granted summary judgment to the towns. The State Board appealed the 1968 decision to the Court of Appeals.

Issue(s)

1. Whether a CPLR Article 78 proceeding is the appropriate method for towns to challenge the State Board of Equalization’s calculation of transition assessments under Real Property Tax Law § 545.
2. Whether the transition assessments for 1968 were correctly calculated by the State Board.

Holding

1. Yes, because an Article 78 proceeding is an appropriate vehicle to obtain judicial review of the performance by administrative agencies of legislatively imposed duties.
2. No, because the transition assessments for 1968 should have been based on the 1967 assessment roll, ensuring no loss of taxable assessed valuation compared to the preceding year.

Court’s Reasoning

The Court reasoned that transition assessments function as a form of state aid to tax districts with state-owned forest lands. While the statute prescribes that transition assessments “shall be, and shall be treated for all purposes as, taxable assessed valuation on such roll” (§ 545, subd 4), this serves to implement the State aid plan. The establishment of transition assessments involves no judgment as to the valuation of particular parcels of real property but is directly related to the total municipal tax base. Because administering this program involves the interpretation of a statute, the making of arithmetic reckonings, and no component of judgment or administrative discretion, Article 78 is appropriate to judicially scrutinize the performance of the Board’s duties. The Court emphasized that the legislature had repeatedly deferred the tapering-off provisions of Section 545, indicating an intent to maintain consistent financial assistance to the towns. Therefore, for the 1968 assessment rolls, transition assessments should have been established to provide total effective assessments of State-owned lands equal to those of 1967. The Court distinguished City of Mount Vernon v State Bd. of Equalization & Assessment, noting that case involved the assessment of individual properties falling within the scope of section 700 of the Real Property Tax Law.