After eight years of discovery and motion practice on behalf of several New York City property owners, Atlantic Legal recently negotiated a successful settlement of its suit challenging the Citys complex tax reimbursement scheme as unconstitutional. According to a former City Housing Department official, as reported in the press, Atlantic Legals suit was a major factor in forcing the City to alter its oppressive bureaucratic mechanisms which prevented property owners from obtaining tax refunds to which they admittedly were entitled.
Under the Citys Senior Citizen Rent Increase Exemption program, as it existed before Atlantic Legals litigation, owners of buildings with rent-controlled or rentstabilized apartments occupied by senior citizens of limited income were prohibited from raising the rent, but were to be compensated in the form of real estate tax abatements or, in some cases, a cash refund. However, the process for claiming the tax credit or cash refund was exceedingly burdensome and the payment of cash refunds was often delayed for months or years while the City audited? the owners rent records.
As a result of this case, the City has simplified the application process, credits tax abatements promptly, no longer requires an audit? prior to crediting the owners tax account or making payment of the cash refund, and makes the cash payment within weeks of the filing of forms.
One Atlantic Legal client commented: Atlantic Legal fought hard for me and other property owners to force the City of New York to correct its capricious refusal to grant tax refunds. We are grateful for Atlantic Legals skillful representation.?
In addition to adopting major modifications in its tax refund procedures, the City agreed that Atlantic Legal was entitled to an award of attorneys fees as counsel for the prevailing party.