I am not a fan of NEZ incentives and they have "helped" us. We bought an NEZ property back in 2008 after selling a Lafayette Park Townhouse. We were excited when the projected property taxes for our new historic home were lower. We later found property taxes in LP were also very low compared to the City average [[perhaps because it was a Cooperative). The next year, our NEZ property was split into three parcels, one for land with no tax benefit, one for the historic building with its taxes "frozen" and one for a new add-on with a NEZ reduced rate.

Of course some entity [[the City blames the State and the State blames the City) set our land assessment very high [[perhaps to maximize taxes collected), set our new add-on, a garage, at a true cash value of more than $300k [[seriously) and assessed value of a nice historic building very low but still somehow unfroze the value from what the previous owner recognized [[what exactly does frozen mean anyway). The total sum of assessments was about double market. Our property taxes went up over 1000% in the first year we owned the versus the prior owner. Only after six years of battling the State and the City did we finally get to a place where our taxes are "reasonable". Overall we are still better off than most in the City.

Nonetheless we'll be paying well into five figure taxes when the NEZ expires. We struggled about selling and sticking the high taxes to someone else but as we poured ourselves into the place and were emotionally tied, we decided instead to further invest in the property to be able to rent it out a part of it. Now our big fear is they'll jack up our taxes excessively and eat up all the rental income.

NEZ is overly complex, and moreover unfair. The City and State need to reform the property tax system completely. A hybrid property tax system that considers factors of lot size and building size would be a far better approach. The present system is unequivocally broken and NEZs should be abolished.