BILL NUMBER: S3665
SPONSOR: HINCHEY
 
TITLE OF BILL:
An act to amend the real property tax law, in relation to expanding the
tax exemption for new farm buildings
 
PURPOSE:
To expand the farm building tax exemption to include on-farm buildings
and structures, used for processing of crops produced on-farm.
 
SUMMARY OF PROVISIONS:
Section 1: amends subdivision 2 of section 483 of the real property tax
law to make buildings and structures used for the on-farm processing of
crops produced on-farm eligible for the state farm building tax
exemption.
Section. 2: establishes the effective date.
 
JUSTIFICATION:
Currently, new farm structures and buildings used to produce crops are
eligible for a ten-year tax exemption. New buildings used for the proc-
essing or on-farm sale of crops are not eligible for the exemption,
except for buildings used in the processing of maple syrup and honey.
Farms are vital to New York's economy and long-term sustainability. The
State is losing farms, partly due to development pressure and partly
because it is difficult to make a living farming. In the past, most
farmers produced crops and sold them wholesale to a processor or
distributor. That model is rapidly changing, especially for smaller
family farms. Small-scale farmers often make more money by selling their
crops or "value-added" products made from their crops directly to
consumers rather than to wholesalers.
New York farmers are national leaders in direct marketing to consumers.
We have over 700 farmers' markets in the state, and an undetermined
number of farmstands and farm stores. In order to make our farms compet-
itive and economically viable, we need to incentivize farm investment in
infrastructure, including buildings for processing farm products. This
bill will help farmers who wish to add value to their products develop
the capacity to process their crops by expanding the existing ten-year
tax break to include new buildings dedicated to processing of crops
produced on-farm. The tax exemption in this bill does not apply to
wedding barns and other event venues since such events are not related
to the production or processing of farm commodities.
Although local tax districts will temporarily lose tax revenue on such
new buildings, the tax break should encourage more farm infrastructure,
which will add to the tax rolls in the long run. Farms with retail
stores should also produce jobs and create agritourism which will help
rural communities throughout the state.
 
PRIOR LEGISLATIVE HISTORY:
A.8417 of 2024: Referred to Real Property Taxation
S.8468 of 2024: Referred to Local Government.
 
FISCAL IMPLICATIONS:
Minimal local tax implications.
 
EFFECTIVE DATE:
This act shall take effect one year after it shall have become a law.