Exempt Properties Top Taxable By $1.6B

New Haven’s taxable grand list is worth around $6.6 billion. It’s tax-exempt grand list is worth around $8.2 billion. And the gap between the two is growing.

Acting City Assessor Alex Pullen Monday night revealed that yawning disparity between property the city can tax and property that it can’t tax, during the Board of Alders Finance Committee’s second public hearing and first department-level workshop on Mayor Toni Harp’s proposed $556.6 million operating budget for Fiscal Year 2019 – 2010 (FY20).

The workshop brought out around two dozen people, mostly city department heads and staffers, to Hill Regional Career High School’s auditorium on Legion Avenue.

At the end of a three-hour hearing otherwise dedicated to city department expenditures, the alders asked Pullen to explain the latest shift in the city’s most important source of revenue: property taxes.

In particular, they asked him to explain how the city’s net taxable grand list — that is, the cumulative total of taxable real estate, personal property, and automobiles in the city — shrank by nearly $15 million, or .23 percent, between 2017 and 2018.

Pullen said that roughly $8.2 billion, or 55 percent, of the city’s property is now tax exempt. Six years ago, he said, the balance of taxable to tax-exempt property was closer to 50 – 50.

“That’s a stunning figure,” said Westville Alder and Finance Committee Vice-Chair Adam Marchand.

Pullen said that the city often experiences slight decreases in net grand list value during the off years between five-year revaluations, when his department reassesses all 27,000-plus properties in town to come up with new base property values for tax purposes.

This year’s $68 million decrease in gross taxable real estate, Pullen and acting City Budget Director Michael Gormany said, was due to court appeal settlements from the last revaluation and due to property acquisitions by tax-exempt entities like Yale University and Yale New Haven Hospital.

“Seven of the top ten real estate decreases specifically are a result of Yale University and Yale Hospital properties moving fully or partially off the taxable grand list and onto the exempt grand list as they are being used for academic/hospital purposes,” Gormany told the Independent by email.

Pullen noted that the net grand list did benefit from several recent high-dollar construction projects like the Alexion building at 100 College St. finally phasing out of the lowest rungs of the city’s tax assessment deferral plan. Gormany said that 100 College alone will see a $53 million increase to its base taxable assessed value this year.

He also pointed out that the gross personal property grand list is up by over $59 million. But, because that increase took place almost exclusively at Yale New Haven Hospital-owned properties, the city’s personal property grand list exemptions are similarly up by around $58 million.

“$58 million was not taken off the tax rolls,” he told the Independent by email after the meeting. ​“This $58 million was previously not on the tax rolls. We are simply reflecting acquisitions by an exempt entity which were, in this case, immediately made exempt.”

“the ​“Gross Personal Property Grand List is up over 59 million” but because most of those acquisitions were made (or at least newly declared to the City) by the Hospital, you will also see an approximately 58 million dollar increase in exemptions as well. The article’s wording is what is causing confusion. 58 million was not taken off the tax rolls. This 58 million was previously not on the tax rolls. We are simply reflecting acquisitions by an exempt entity which were, in this case, immediately made exempt.

“It’s kind of a gift and a curse in the same token,” Pullen said.

As a whole, Pullen said, the grand list is down only about a quarter of a percent, which he said is ​“not too bad” in a non-revaluation year.

Morris Cove Alder Sal DeCola asked how the city’s increase in tax-exempt property affects how the state reimburses the city for lost property taxes through its Payment in Lieu of Taxes (PILOT) program.

“The state is tricky,” Pullen said. ​“It should in a perfect world equate to the city receiving more money. Theoretically our percentage of the pie should get bigger.”

But with the state working through its own budget troubles and with PILOT’s funding percentage already down to below 40 percent, that proportionate increase may not be coming any time soon.

Correction: This article initially stated that the hospital had taken $58 million of formerly taxable personal property off of the tax rolls. That was incorrect. The hospital had indeed acquired and/or declared $58 million worth of personal property, but that property was not previously on the tax rolls.