Commissioner Lee's testimony: initial determination letters and exemption process
The testimony explains that only 17,000 of 960,000 listed properties received initial determination letters. Properties with existing primary residency proof, such as SCHE/DHE recipients, were excluded. The letters are not tax bills but allow owners to submit proof of primary residency.
Section 11-3205 of the Admin Code, part of the statutory framework,
governing the surcharge, requires the city to administer and enforce the surcharge, quote, to the greatest extent practicable,
in the same manner used to administer and enforce real property taxes, unquote, and requires the publication of corresponding property valuation information
on a roll.
The law authorizing the surcharge was adopted after the assessment roll for fiscal year 2627 had already been published.
As a result, the law governing the surcharge required the city to release a supplemental mid-cycle roll
for the 2627 tax year in order for the
surcharge to be administered.
Stated differently, for the 26-27 fiscal year only, Finance published a new assessment role mid-year, the July 2026 supplemental role.
This largely involved republishing data from the May 2-6 final assessment role.
Finance published the required supplemental role on July 24, 2026.
This supplemental role includes relevant property valuation information and certain descriptive information regarding all property.
That meets the surcharge statute definition of quote, covered property, unquote.
The universe of the properties considered covered property for purposes of the law is much broader than the properties that were sent initial determination letters
as explained below or that will eventually be subject to the surcharge.
In light of this, it is important to emphasize what the supplemental rule does not do.
The supplemental rule does not establish which properties are subject to the surcharge.
It generally includes certain information to identify such properties and their ownership.
Like the assessment roll, publication of the supplemental roll provides a basis for property owners to change.
challenge the value of their properties.
The law also requires finance to send initial determination letters to property owners whose properties may be subject to the surcharge
and whose primary residency could not be confirmed based on the information available to the agency as described in finance rules.
Only a very small subset of the population of properties that were listed in the supplemental roll
received an initial determination letter, about 17,000 homes out of approximate total of 960,000 listed homes.
The surcharge only applies to those Class 1 properties, which typically include one to three family homes, with market values greater than or equal to $5 million,
and cooperative and condominium dwelling units with market values greater than or equal to $1 million.
Some properties that would have otherwise received an initial determination letter did not ultimately receive one because finance already possessed data
that sufficiently demonstrated that the property was used as a primary residence and was therefore not subject to the surcharge.
For example,
Homeowners who affirmatively established primary residency with finance already were the two
627 fiscal year, such as homeowners who received the Senior Citizens Homeowners Exemption, known as SHI,
or the Disabled Homeowners Exemption, known as D, and therefore have provided proof of residency as well as proof of income for eligibility, did not receive this initial determination letter.