IN RE: 243 EAST 32ND STREET LLC (2025)

Judgment (denominated an order), Supreme Court, New York County (Lynn R. Kotler, J.), entered July 26, 2023, which denied the petition to annul and reverse an October 4, 2021 revised notice of property value issued by respondents upon granting petitioner's application to correct a clerical error or error in description of its property and to direct respondents to correct the revised notice, and dismissed the proceeding brought pursuant to CPLR article 78, unanimously affirmed, without costs.

Respondents rationally addressed petitioner's request for a clerical correction to its tax classification based on the conversion of its building from a four-family residential building to a two-family residential building.  As Supreme Court found, respondents corrected the tax classification in the relevant tax years by performing a reassessment of the building's value to determine whether it was necessary to reduce the actual assessed values, and they concluded that no change in the actual assessed values was warranted (see Matter of Board of Mgrs. of the Liberty View Condominium v. New York City Dept. of Fin., 188 A.D.3d 450, 451, 131 N.Y.S.3d 886 [1st Dept. 2020], lv denied 36 N.Y.3d 906, 2021 WL 627977 [2021];  see also Administrative Code of City of N.Y. § 11–206).  The assessment roll was corrected from Tax Class 2A, for which respondents determine market value using the income capitalization approach (generally regarded as the preferred method for determining the value of income-producing property) to Tax Class 1, for which respondents determine market value using the sales and analysis comparison (the most commonly used method) (see 41 Kew Gardens Rd. Assoc. v. Tyburski, 70 N.Y.2d 325, 330–331, 520 N.Y.S.2d 544, 514 N.E.2d 1114 [1987]).  Thus, it was reasonable for respondents to reassess the value of petitioner's property using the latter method upon granting the correction, as state law does not dictate a particular formula for determining the threshold of full market value (see id. at 330, 520 N.Y.S.2d 544, 514 N.E.2d 1114).  In the absence of any legally mandated criteria, it is within the expertise and discretion of the Commissioner of Finance to ascertain fair market value (see Matter of Kraebel v. New York City Dept. of Fin., 217 A.D.2d 416, 417, 629 N.Y.S.2d 42 [1st Dept. 1995], appeal dismissed 86 N.Y.2d 835, 634 N.Y.S.2d 438, 658 N.E.2d 216 [1995], cert denied 516 U.S. 1146, 116 S.Ct. 1018, 134 L.Ed.2d 97 [1996]).

We find no denial of due process, as respondents would have used sales and analysis comparison for fiscal year 2016 had the assessment roll shown the correct tax class, and petitioner appropriately challenged respondents’ determination by bringing this proceeding.