Local governments and school districts rely heavily on taxing the most easily identifiable form of personal wealth, which is real estate. They don’t often tax an individual’s holdings of stocks and bonds nor real capital (like a bulldozer), nor coins and collectibles, nor bank balances, gold bars, patents or royalties.

These property taxes — along with other sources such as state and federal aid — provide the revenue to pay for local schools, fire and police protection, roads and infrastructure, and even public libraries.

The burden of these local government and school taxes falls on individual property owners and on those that rent from them. The more taxes the landlord pays, the higher the rent.

Serious inequities arise when a large portion of local real estate is exempted from property taxation since these exemptions result in other taxpayers bearing disproportionate financial responsibility for local government and local school expenses.

The City of Geneva provides an excellent example. Over 400 parcels, accounting for 60% of the total value of land within the city, are tax exempt. The included maps illustrate this problem just along South Main Street to the southern end of the city. The shaded properties, including some of the most valuable in the city, pay no property taxes.

While most of these properties are tax exempt because they are owned by Hobart and William Smith Colleges, similar maps illustrate the same inequities in sections of the city around the Cornell Experiment Station, Geneva General Hospital, the Finger Lakes and Norfolk Southern railroads, Guardian Glass and Henkel, the Fairfield Inn, and the 41 Lakefront Hotel.

One family, whose property is part of the included maps, pays over $27,000 each year in city, county, and school taxes. Over $12,000 goes for schools; another $10,000 goes for fire, police, public works, and city managers; $4,000 goes to Ontario County; $500 goes to the library; and another $500 pays for workers’ compensation.

By contrast the shaded properties pay nothing. They do not support our schools. They get police and fire protection and street repairs and yet they pay nothing, or in some cases they make a trivial contribution, which is far less than were they to pay their fair share.

Norfolk Southern’s stock price doubled in one year from 2020 to 2021. Yet the railroad pays little local tax because its 21 acres of valuable lakeshore land are assessed at only $12,000 per acre while private parcels next to it are assessed at $200,000 per acre.

Churches argue for tax exemption even for big, beautiful buildings that are grossly underutilized. They harken back to the framers of our Constitution who wanted a “separation of church and state.” Most taxpayers agree with such a separation but not with free services provided to churches by tax-paying property owners and renters. Church properties pay nothing for fire and police protection, nothing for the roads and curbs, nothing for our schools and library.

The consequence of this unequal treatment is a combined tax rate of $44 per $1,000 of assessed value. This causes businesses to leave, prospective businesses to locate elsewhere, and developers to whine for PILOTs and other inequitable tax relief.

Meanwhile, the tax-exempt trend in Geneva continues. The Colleges and Geneva General Hospital have removed over four dozen properties from the tax rolls; some of it literally disappears as it is melded into other lots. The City itself takes property in foreclosures and gifts and makes little effort to put it back on the tax rolls.

Mayor Valentino has said this is not a priority or at least not his priority. This past year 26 acres went off the tax rolls without anyone either noticing or caring.

McGowan is a longtime Geneva resident and a retired professor.

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