City Comptroller John Liu and state Comptroller Thomas DiNapoli yesterday announced that a joint audit found New York City’s Department of Finance failed to collect an estimated $24 million in property taxes because it did not use available resources to identify property owners who did not report income from cell antennas.
“As phone companies and cell tower landlords profit handsomely, our taxpayers are entitled to share in that revenue,” Liu said. "This audit clearly outlines how the Finance Department can recover $24 million. That's real money that can stave off anything from tax increases to cuts in public services.”
“During these tough economic times, the city and state need to maximize all sources of available revenue to keep crucial programs running and needed employees like police, firefighters and teachers on the job,” DiNapoli said.
Owners of commercial properties and large apartment buildings must report income from cell antenna equipment to the Department of Finance. This income increases the city’s assessed value of the property, which helps determine property taxes. Auditors used Department of Buildings data and other resources available to the Department of Finance to find 2,108 property owners who failed to report income from cell equipment in 2008–2009.
By comparison, in 2009, the agency’s assessors found just 90 properties that failed to report income.
In Brooklyn, there were 363 properties with unreported income, missing tax revenues of $5.8 million.
The Department of Finance agreed to use additional available databases in order to expand its search for unreported income, to apply cell site income to properties when it verifies property owners have not reported such income, and to consult with the Law Department about imposing penalties on owners who fail to report income.
When the Department of Finance discovers that an owner has failed to report income, the agency adds a preset amount to the property’s income and adjusts the assessed value. Based on Department of Finance estimates, properties in Brooklyn, Queens, Staten Island, the Bronx, and Manhattan north of 125th Street make about $2,000 a month per cell carrier that leases space. South of 125th Street, properties make an estimated $4,000 per month.