Appellate Court affirms: Nassau's steep real estate fees are illegal

                                                                                   

Nassau County government building in Mineloa that includes the County Clerk's office

                                                                                 

Nobody can say Nassau wasn't warned, including former Democratic Nassau County Executive Laura Curran and successor Republican County Executive Bruce Blakeman -- and even the county's control board, the Nassau Interim Finance Authority .

Both county executives imposed exorbitant tax map certification fees and NIFA approved budgets that included those fees even though they were found to be unconstitutional by a state court judge in 2020.

Now the state Appellate Division has weighed in and agreed that the fees are too high to be legally justified.

Last Wednesday, a four court appellate division panel affirmed the lower court decision that found "the county's current fee associated with issuing a Tax Map Certification letter is excessive and not tied to the county's responsibility to maintain its property registry."

So now the County can appeal again, and hope the state's top court, the Court of Appeals, overturns the decision. Or the county will have to reduce its budget, which includes $45 million in revenues from the fee this year.

Though refunds are not addressed in the decision, the county could have to dig even deeper into its budget if homeowners demand refunds for these fees, which were first found to be illegal in 2020.

If that's the case, the refund bill alone could amount to about $120 million.

The county legislature is expected to take some type of emergency action on Monday to reduce the fee, but only by a token amount.

The issue began in 2015 when the county legislature, trying to avoid a property tax hike, doubled real estate fees for buying and selling property in Nassau.

Realtors and title agencies complained the high fees would likely make closing costs in Nassau the highest in the state. They also pointed out that fees, as opposed to taxes, are supposed to pay for the actual services provided; in this case, verifying the property location and ownership.

In 2017, homeowner Jeffrey Falk sued,  after he bought a house in Nassau and paid $1,225 to record his deed and mortgage including a total $450 to obtain two tax map certification letters from the county clerk.

In his lawsuit, Falk showed the tax map certification fee was first imposed in 2012 at a cost of $50 per letter. In Jan. 2015, the county raised the fee to $75. On Jan. 2016, the fee increased to $225. And by Jan. 1, 2017, the fee was raised to $355. Some simple transactions require multiple letters, with separate tax map certifications and fees.

Supreme Court Justice Jeffrey Brown ruled the high fees were "an unlawful and unconstitutional tax,"  that were used to pay for general county expenses rather than financing real estate transactions.

Although Curran objected to the fees when she was running for county executive in 2017, she refused to reduce the $355 tax map verification fee in 2021 when Republican legislators proposed it be eliminated altogether.

Republican legislators did not make the same demand or ask for any reduction in the tax map fee after fellow Republican Blakeman took office.

 Here is the decision: