Court Rules Against Village in Benefit Assessment Case
By Stephanie Mariel Petrellese

A recent State Supreme Court ruling that found the Village of Garden City's calculation of special assessment against the owners of 1200 and 1300 Franklin Avenue was not "just and equitable" could substantially impact other commercial properties within the Village.

According to Village Counsel Gerard Fishberg, the Village plans to appeal the decision.

Last March, the Garden City Board of Trustees adopted a resolution by which it levied and apportioned a special assessment against various commercial properties allegedly benefited by improvements expanding Garden City municipal parking lot #10. The lot is located adjacent to Franklin Avenue between Tenth and Eleventh Streets.

The Village took all properties listed on an assessment map filed in connection with the improvements and assessed them at a uniform rate of $2.17788782 per square foot, based on the greater of the (1) actual or; (2) maximum permissible floor area (FAR) of the property in question. The FAR is determined by taking the floor area in square feet and dividing by the area in square feet of the plot on which the building is situated.

According to Fishberg, the Board of Trustees followed Village law, which stipulates that assessments should be determined "according to frontage, area, or otherwise, as the board may determine during the proceedings to be just and equitable."

LT Propco, LLC, the owners of 1200 Franklin Avenue, were assessed $457,564.55 and 1300 Franklin Avenue Members, LLC, the owners of 1300 Franklin Avenue, were assessed $458,854.45. They had the two largest assessments, equaling 36 percent of the total $2,539,866.75 assessment imposed.

They successfully argued that the maximum permissible floor area of the buildings that the Village used to calculate the assessment was incorrect. The Village used the maximum FAR permissible on the properties. The owners claim that they could never reach their maximum FAR, but the Village contends it is possible if they constructed an underground parking garage.

In his decision, State Supreme Court Justice Joseph P. Spinola said the Board should take into consideration how close a property is to the benefit. In this case, both properties already have ample parking so they do not benefit much from the additional parking provided in lot 10.

Fishberg said he does not know if the Village will have to do new assessments. The impact of this judicial decision, if not reversed on appeal, could substantially impact other commercial property owners who are paying assessments based on the current formula used by the Village. The current methodology does not factor in how close a property is to the alleged benefit.

The standard the court used was whether the Board's assessment calculation was "arbitrary and capricious" or "supported by a rational basis." Fishberg said the Village will argue on appeal that they determined the assessments based on the law and their calculation was reasonable. He also said that the court should look at what information was provided to the Board at the time they made their decision. Fishberg claims the building owners were not particularly forthcoming with information concerning their properties.

The attorney for the owners of 1200 and 1300 Franklin Avenue is confident that the decision will be upheld. "My clients are pleased with the decision," said Donald Leistman, of Koeppel Martone & Leistman LLP, a law partnership specializing in tax assessment and condemnation law. "They think it's 1,000 percent correct."