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May 11, 2011 10:20 AMPublication: The Southampton Press

Error On Veteran Exemptions Cost Town $1.1 Million Over Six Years

May 11, 2011 10:59 AM

Southampton Town has been miscalculating the amount of New York State tax benefits offered to the town’s more than 2,000 veterans since at least 2006, and that error—blamed on the inclusion of an extra zero where it didn’t belong—has resulted in nearly 99 percent of them receiving a greater tax exemption than they should have qualified for over that period.

The mistake, according to calculations by Acting Town Assessor John Valente, has cost the town nearly $1.1 million, or roughly $180,000 per year over the past six years.

Just recently, the town has corrected the formula and, as a result, most veterans will have to fork over more in taxes starting with their 2011-12 tax bills. A mass mailing from the town assessor’s office was sent to veterans informing them of the change on May 1.

In spite of the error, Southampton Town Board members said they are not interested in recouping any of the lost revenue.

It’s “a mistake on the part of the town, and we’re going to ask for the money back?” posed Town Councilman Chris Nuzzi this week. “No. No way.”

The town stumbled across the error in January, when Quogue Village Mayor Peter Sartorius called the assessor’s office and said he thought he might be receiving too large of a benefit as a veteran. Mr. Sartorius did not return calls seeking comment this week.

The average veteran, Mr. Valente said, will realize a decrease in his or her benefit of about $84 a year.

Out of the town’s estimated 2,325 veterans, 52 percent are expected to see their exemptions reduced by less than $100 a year, resulting in a slight increase in their tax bills under the new calculations, according to Mr. Valente. Twenty-five percent will see an impact of between $100 and $300 a year. Six percent of veterans will see a reduction in benefits in excess of $300 a year, and possibly as high as $650 a year, he said.

At the same time, the remaining 17 percent of veterans will actually see an increase in their benefit levels—or a tax decrease—under the new exemption calculations, according to the mailing circulated by Mr. Valente.

There are several factors that are used to determine a veteran’s tax benefit, such as the individual’s home valuation and which tier they fall under. The system is broken down into three categories: basic/alternative, which is for veterans who haven’t engaged in combat; combat veterans; and disabled veterans. Each category has different percentages of exemptions and different caps. For example, a veteran will be eligible to have 15 percent of his or her assessed home exempt from taxation, but that value will be capped at $54,000. The percentages increase for combat veterans and disabled veterans, with the latter receiving the maximum allowable benefit, but those values would be capped too.

Essentially, what went wrong years ago was that the caps were miscalculated in mathematical tables used by the town assessor’s office to compute the benefits: instead of $54,000, an extra zero was erroneously added, making the cap $540,000. That produced tax benefits that were two to five times greater than if they had been calculated using the correct figures, Mr. Valente stated in an email to local and state lawmakers last Friday.

Mr. Valente said he believed the caps should have been in place since 2004 but were not. The incorrect caps were plugged into mathematical tables in 2006 after the Town Board enacted local legislation to increase the caps that apply to exemptions for veterans. He could not point to a specific individual or department that was responsible for the mistake.

Some veterans interviewed this week said they were not yet aware of what it could mean for their tax bills.

Arma “Ham” Andon, commander of the Veterans of Foreign Wars Post 5350 in Quogue, said the calculation will be different for each person, based on the varying factors. “Each person is going to get a different take on it,” he said. “It’s not all uniform. Some people are going to get less, some people are going to get more. I don’t think the veterans fully comprehend yet what’s going on.”

John Ryan of East Quogue, another veteran, said that while the additional taxes he has to pay would be minimal, he was under the impression that veterans’ benefits weren’t going to be affected by the formula change. He added that he is worried that the town’s action to correct the mistake could lead to more reductions to veterans’ benefits in the future.

Ernie Trillo, a veteran who lives in Hampton Bays, was not excited to learn about the news. “Nobody likes to pay taxes,” he said. “Every year, the school taxes go up.”

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This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By East Ender (64), Southampton on May 11, 11 3:05 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By East Ender (64), Southampton on May 11, 11 3:05 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By East Ender (64), Southampton on May 11, 11 3:05 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By East Ender (64), Southampton on May 11, 11 3:05 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By East Ender (64), Southampton on May 11, 11 3:05 PM
This Town is going in a direction of insolvency! We dishonor our citizens
who pay taxes, we dishonor our veterans, we dishonor our seniors and
honor those that BREAK THE LAW! School Budgets are increasing every
year with very little help from Albany! I am disasspointed by the lack of
representation of our citizens while we cater to those special interest groups!
All of Southampton is for sale! How sad it is that no one will standup for
this country!
By East Ender (64), Southampton on May 11, 11 3:05 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By East Ender (64), Southampton on May 11, 11 3:05 PM
AGAIN......What the hell is going on in Town Hall? We can't seem to get or have qualified people doing their jobs!!! Now it's another round for the Assessors office, they just can't get it right....1st all the problems with grievences, 2nd with not applying for equalization rates 2 years in a row in the Flanders area and now the Veterens exemptions. Our Town Board needs to explain the why were always playing catch up. We need competent people running deparments. All this auditing, so we the people ...more
By The Crow's Nest (65), Red Creek on May 11, 11 3:58 PM
It would seem that incompetence, and job retention go hand in hand, like arrogance, and ignorance.

Or, at least, recent history in multiple locales points to such.

It is quite an insult to those compentent at their profession...
By Mr. Z (11847), North Sea on May 11, 11 4:54 PM
This comment has been removed because it is a duplicate, off-topic or contains inappropriate content.
By joe hampton (3461), south hampton on May 12, 11 8:58 AM