The Board of Trustees of the Village of East Hampton finds that the real property tax exemptions for capital improvements to residential buildings provided for in § 421-f of the Real Property Tax Law of New York State would encourage historic preservation.
A. 
Residential buildings in designated historic districts and designated landmarks reconstructed, altered or improved subsequent to the date of this article shall be exempt from taxation and special ad valorem levies to the extent provided hereinafter.
B. 
Guidelines.
(1) 
Such buildings shall be exempt for a period of one year to the extent of 100% of the increase in assessed value thereof attributable to such reconstruction, alteration or improvement and for an additional period of seven years subject to the following:
(a) 
The extent of such exemption shall be decreased by 12 1/2% of the exemption base each year during such additional period. The exemption base shall be the increase in assessed value as determined in the initial year of the term of the exemption, except as provided in Subsection B(1)(b).
(b) 
In any year in which a change in level of assessment of 15% or more is certified for a final assessment roll pursuant to the rules of the State Board, the exemption base shall be multiplied by a fraction, the numerator of which shall be the total assessed value of the parcel on such final assessment roll (after accounting for any physical or quantity changes to the parcel since the immediately preceding assessment roll), and the denominator of which shall be the total assessed value of the parcel on the immediately preceding final assessment roll. The result shall be the new exemption base. The exemption shall thereupon be recomputed to take into account the new exemption base, notwithstanding the fact that the Village Clerk receives certification of the change in level of assessment after the completion, verification and filing of the final assessment roll. In the event that the Village Clerk does not have custody of the roll when such certification is received, the Village Clerk shall certify the recomputed exemption to the local officers having custody and control of the roll, and such local officers are hereby directed and authorized to enter the recomputed exemption certified by the Village Clerk on the roll. The Village Clerk shall give written notice of such recomputed exemption to the property owner, who may, if he or she believes that the exemption was recomputed incorrectly, apply for a correction in the manner provided by Title 3 of Article 5 of the Real Property Tax Law of New York State for the correction of clerical errors.
(c) 
Such exemption shall be limited to $80,000 in increased market value, or such other sum less than $80,000, but not less than $5,000 of the property attributable to such reconstruction, alteration or improvement and any increase in market value greater than such amount shall not be eligible for the exemption pursuant to this section. For the purposes of this section, the market value of the reconstruction, alteration or improvement shall be equal to the increased assessed value attributable to such reconstruction, alteration or improvement divided by the Class I ratio in a special assessing unit or the most recently established state equalization rate or special equalization rate or special equalization rate in the remainder of the state, except where the state equalization rate or special equalization rate equals or exceeds 95%, in which case the increase in assessed value attributable to such reconstruction, alteration or improvement shall be deemed to equal the market value of such reconstruction, alteration or improvement.
(2) 
Reconstruction, alterations or improvements.
(a) 
No such exemption shall be granted for reconstruction, alterations or improvements unless:
[1] 
The building is residential and in a designated historic district of the Incorporated Village of East Hampton;
[2] 
Such reconstruction, alteration or improvement was commenced subsequent to the effective date of this article;
[3] 
The value of such reconstruction, alteration or improvement exceeds $3,000; and
[4] 
The greater portion, as so determined by square footage, of the building reconstructed, altered or improved is at least five years old.
(b) 
For purposes of this section the terms "reconstruction," "alteration" and "improvement" shall not include ordinary maintenance and repairs.
C. 
Such exemption shall be granted only upon application by the owner of such building on a form prescribed by the State Board. The application shall be filed with the Village Clerk on or before the appropriate taxable status date of the Incorporated Village of East Hampton.
D. 
If satisfied that the applicant is entitled to an exemption pursuant to this section, the Village Clerk shall approve the application and such building shall thereafter be exempt from taxation and special ad valorem levies as herein provided commencing with the assessment roll prepared on the basis of the taxable status date referred to in Subsection C of this section. The assessed value of any exemption granted pursuant to this section shall be entered by the Village Clerk on the assessment roll with the taxable property, with the amount of the exemption shown in a separate column.
E. 
For the purposes of this section, a "residential building" shall mean any building or structure designed and occupied exclusively for residential purposes by not more than two families.
F. 
In event that a building granted an exemption pursuant to this section ceases to be used primarily for residential purposes or title thereto is transferred to other than the heirs or distributees of the owner, the exemption granted pursuant to this section shall cease.