Decreasing C of O

About 5 years ago I renovated two floors of our 4 family brownstone, and made a 3 family. I had the C of O changed, with the goal of reducing my RE tax bill (Tax class 1 iso class 2.)

My building has sprinkler system, not a fire escape. If I had a fire escape, I would have removed it. My only motivation to remove the sprinkler would be to reduce the cost of the annual sprinkler inspection, but I like the additional security provided by the sprinkler.

Long story long, to change the c of o, I had to have an actual DOB inspection, iso of the architect self certifing the completed job. The DOB inspector had some minor issues that required additional building costs, nothing too expensive but some more $ and more time and another inspection. Also I had to go downtown to politely ask for the completed electric sign off to be entered into the computer system at DOB. It was complete but not entered for months.

Finally the 3 family c of o was issued, on March 16th. The last day to apply for a tax re-classification is March 15th.

The following year I applied for a re-classification. I was given a hearing in late July, on my birthday. I told the judge it was my birthday, and the judge was very nice about it. An inspection of the premises by a tax dept person was arranged and months later my tax re-classification ruling arrived in the mail. I was denied!

I was furious! Years and monies spent to reduce my tax bill and I was denied! I was ready to take the Dept of Finance to the mat. I called an real estate tax attorney. The attorney asked for me to fax the documentation. After reviewing my case she said that the denial was my birthday gift.

If the propety was re-classified, my property's accessed value would be at a current rate with none of the benefits of the historic increase cap rates that most old buildings in Brooklyn enjoy. My taxes would be based on the lower % of a much higher number and be a higher amount.

Five years later, my property has a c of o for a three family but is classified as a 4 family in the Dept of Finance.

In the future, as the accessed value increases, I will re-apply for the reclassification, but in the mean time I will pay the lower tax bill.

Posted by: Anonymous at December 28, 2005 11:34 AM

I bought a small two family that I converted to a legal one family. There was no other way to legally do the renovation since plans had to be filed for the renovation. It's best to have the C of O match the actual use of the house. Otherwise, if there's a disaster like a fire or an earthquake (NYC is on a major fault line), the insurance company might refuse to pay since the home isn't being used legally.

Posted by: Anonymous at January 15, 2006 11:26 PM

As I understand it from our real estate lawyer, there's no harm in having a C of O that doesn't match the house as long as it's for MORE units than you've got.

In other words, if you have a 1-Family C of O but rent out two apartments, you're breaking the law and could be in trouble in case of fire, earthquake, etc. However, if like us, you have a 4-Family C of O on a building that was long ago converted to two units, there's no problem.

Posted by: Anonymous at April 4, 2006 2:41 PM