With the slowing economy damping forecasts for property sales (and thus property tax receipts), the Spitzer administration is proposing an increase in real estate transaction closing fees.
In Governor Spitzer’s proposed $124 billion budget, unveiled yesterday, the state will levy a fee of up to $400 on residential property sales and up to $575 for sales of commercial property. The new fees are indexed (i.e. sales for small amounts pay less of a fee than large sales), and the current fee is a flat rate of $75 for residential property and $165 for commercial.
Throughout his executive budget, the governor seems to be turning to fees to raise needed capital to fund the $4.4 billion budget gap, on top of “closing loopholes” (or altering taxing structures, depending on whose language one prefers), and bringing in a bit more money from the vice sector (taxing illegal drugs, putting Smirnoff Ice into a higher tax category; selling rights for Video Lottery Terminals at Belmont).