Locking Public Out Of Gramercy Park Has Cost City $13M: Report

GRAMERCY, NY — The owners of buildings surrounding Gramercy Park are supposed to pay higher property taxes for exclusive access to the famous city greenery, but are essentially paying the same as those who do not have keys to the park because of an unequal property tax system and years of neglect, according to a joint investigation by Gothamist and WNYC.

For the 39 properties that bound Gramercy Park, landowners are supposed to pay a share of their property taxes that reflect the value of living in a property with the city's most prestigious park on its doorstep.

But analysis conducted by Gothamist and WNYC found that nearby residential properties — whether they were single-family homes, co-op or rental buildings — all pay roughly the same taxes per square foot regardless of if the properties come with keys to the exclusive park or not.

In some cases, the property owners actually pay less than those without keys to the park and condo owners without park access paid $4 more per square foot in taxes than those with access to the park in the fiscal year of 2018, according to the investigation, which is the first in Gothamist and WNYC's three part series on Gramercy Park.

Policy experts told Gothamist and WNYC that the investigation's findings challenged the validity of continuing such a deal.

“It sounds like it’s questionable whether or not there's any continuing public purpose in that arrangement, and it should be revisited for the benefit of all New York City taxpayers," James Parrott, the director of economic and fiscal policies at The New School’s Center For New York City Affairs, told the publications.

The 108-year-old arrangement with Gramercy Park landowners dates back to when the city first tried to issue a tax on the park itself, but the Trustees of Gramercy Park argued that their homes were worth $17 million more, in modern currency, than those who did not have access to the park. The trustees argued that the higher property values created a greater tax burden that essentially paid for their ability to prevent others from using the park, the investigation explained. Judges sided with the trustees in 1910.

The city has never challenged the ruling. And while the key holders arguments may have been true then, it has not for at least the last decade according to Gothamist and WNYC's findings.

Potentially millions of dollars of city revenue are being lost each year by not fully capturing the value of Gramercy Park when taxing key-holding property owners, which include Jimmy Fallon, Richard Gere and Janet Malcolm, the investigation alleges. The public may be subsidizing what Gothamist and WNYC call "the most famous private park in the world" where the surrounding neighborhood has a dearth of green space.

The publications project that properties with park access would have paid an extra $13 million in taxes since 2009.

A deputy commissioner with the City's Department of Finance told Gothamist and WNYC that the city's complex tax system has evolved too much over the years and that it is impossible to know if the city is gathering the same worth from Gramercy Park that it was roughly a century ago.

“It’s a dated agreement and thus, I don’t know if we can say it as scientifically today, that we’re getting dollar for dollar,” Timothy Sheares said to the pair of publications “There is no basis for equity in real estate taxes in the City of New York.”

Read the full investigation at Gothamist.

Photo courtesy of Jeffrey Zeldman, used with permission.