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Wetlands And Real Property Valuation

What is the Freshwater Wetlands Act?

The Freshwater Wetlands Act (Article 24 of the Environmental Conservation Law) was passed in 1975 to preserve, protect and conserve those freshwater wetlands in the state that are greater than 12.4 acres in size and any smaller wetlands of unusual local importance. An adjacent area of 100 feet is also protected to provide a buffer zone to the wetland. Wetlands are identified by their characteristic vegetation, such as cattails and speckled alder, and by the presence of wet or flooded soils. They are then classified into one of four classes according to the benefits they provide, from Class I wetlands which provide the most values, to Class IV wetlands which provide the fewest benefits. All protected wetlands are shown on maps prepared by the Department of Environmental Conservation (the Department) and available for inspection at local government clerks's offices or through the Department's regional offices.

The Act recognizes that wetlands provide many important benefits for the people and the environment of New York State. These include flood protection, water quality improvement, and fish and wildlife habitat. The Act seeks to protect these values by regulating any activities that might have a negative impact on the wetland benefits. Regulated activities include draining, dredging, filling, building structures, and polluting. In order to conduct a regulated activity in a protected wetland or its adjacent area, a permit must be granted from the Department. However, many activities do not require permits, especially those actions that generally do not have a negative impact on the wetland. Exempt activities include cutting fuelwood, maintaining or operating existing buildings or other structures, mowing lawns, or conducting most outdoor recreation. In addition, the Legislature specifically exempted from regulation most normal agricultural activities, except agricultural filling and clear-cutting of trees.

The Act makes provisions to ensure that all landowners can have some reasonable use of their land. Sometimes a proposed project must be modified in order to minimize damage to the wetland. Frequently, unavoidable impacts must be compensated for by various forms of mitigation. It often is more difficult to get a permit to alter a Class I wetland than a Class III or IV wetland because Class I wetlands provide more important wetland benefits. And, occasionally, permits must be denied in order to prevent significant environmental losses from occurring. However, in most circumstances, landowners are satisfied with the outcome of their project review with the Department.

The Act acknowledges that some limitations may be placed on how landowners use their property:

Unfortunately, this section of the law has created confusion for many people. The Act does not provide any new or additional rights for affected landowners. This is because real property valuation is based on the highest and best use allowed for the property. In many situations, the assessor had already considered the physical limitations that wetlands pose for development, such as poor or unstable soils and excess water or flooding. In these cases, an assessment may already be low. In addition, the landowner may be able to use the property at the level for which it has been assessed.

The Act does not provide tax exemptions, per se, for landowners with wetlands. Real property valuation is assessed at the local level, not through the Department at the state level. The Act merely recognizes that the constraints posed by the Freshwater Wetlands Act may influence allowed land use, which then should be a consideration, like other zoning and land-use restrictions, during real property valuation.

Generally, if you are not permitted to fully use your property at the level for which it is assessed, then a reduction in valuation may be appropriate. However, all determinations must be made on a case-by-case basis by your local assessor. A 1981 court case (known as Katz v. Town of Mt. Kisco) reaffirmed the long-standing principle that an assessment is presumed valid and that the burden is on the landowner to show by substantial evidence that the assessment is excessive. In addition, the landowner should realize that an outdated assessment may fail to reflect accurately the true value of the property. An assessor may agree to a reduction in assessment based on the Act for any constraints the wetlands law may impose, but this reduction may be offset by an overall upward adjustment for an updated assessment of the remaining property.

If you believe that you are entitled to a reduction in your property assessment because of actual limitations placed on your property as a result of the Act, you should proceed as you would for any other adjustment of your assessment. Begin by contacting your local assessor, whose responsibility it is to determine real property valuation. Discuss your concerns with the assessor and demonstrate why your assessment should be reduced. If you are not satisfied at this level, recourse is available through the local board of assessment review. Finally, rulings of that board may be challenged in Supreme Court via a proceeding under Article 7 of the Real Property Tax Law.

Remember, the burden of proof is on you - the landowner - to show that the assessment is improper. The courts have accepted the following approaches as reasonable evidence of limited use or incorrect valuation:

1. Evidence of sales of comparably restricted parcels - this would mean showing the sale value in the current market of similarly sized and located parcels on which similarly regulated wetlands are located.
2. Evidence that the Department has denied a permit or severely constrained a project. Merely assuming that the Department would not issue a permit undoubtedly would not be sufficient for your assessor or the courts; you probably will need to provide documentation for your local assessor.

Please remember that your local assessor, not the Department, must make the decisions on how your property is valued and taxed. But the Department might be able to help in a few ways. First, this document was produced, in cooperation with the groups and agencies shown at the end, to provide you with information so you can approach your local assessor as an informed taxpayer. In addition, regional offices of the Department can provide you with copies of that portion of the wetlands map that includes your property. These maps also are available for inspection at your local government clerk's office The map will help you show the assessor how much of your property contains wetlands.

This brochure was produced by the New York State Department of Environmental Conservation in cooperation with the following groups, organizations and agencies: The New York State Association of Realtors, Inc., The New York State Assessors' Association, Inc., The New York State Conference of Mayors and Other Municipal Officials, The New York State Association of Towns, The New York State Association of Counties, and The New York State Office of Real Property Services.

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• Division of Fish, Wildlife and Marine Resources
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