By Tynesha Goode
New York City has extended the Industrial and Commercial Abatement Program (ICAP) until March 1, 2022. The program, which replaced the Industrial Commercial Exemption program (ICIP), provides for a partial abatement of taxes for eligible industrial or commercial buildings that are constructed, modernized, rehabilitated, expanded, or otherwise improved.
ICAP Application Process
To apply for ICAP:
- File the ICAP Preliminary Application and $150 fee before the program expiration date.
- Secure any necessary building permit(s) from the Department of Buildings. (Applicants that receive permits before filing a Preliminary Application will not receive benefits.) NOTE: If construction does not require a building permit, applicants must submit a notarized letter from the project’s architect or engineer notifying the Department of Finance within 30 calendar days of construction completion.
- File required annual Income and Expense Statements (RPIEs) for the property.
- Report all current construction to the Department of Finance semi-annually throughout the construction or renovation period.
Applicants that submit their preliminary application within the program timeframe can use the combined Final ICIP/ICAP Application.
Upon filing the ICAP Preliminary Application, applicants must meet the following milestones:
- All ICAP applicants must promote contracting opportunities on the project among Minority and Women-Owned Business Enterprises (M/WBEs). Visit the city’s Online Directory of Certified Businesses to find M/WBEs.
- For projects $750K and over: Applicants must submit a copy of the ICAP Preliminary Application for Certificate of Eligibility and the ICAP M/WBE Compliance Report to the NYC Small Business Services – Labor Services Unit.
- Notify the Division of Labor Services 15 business days before starting work. Employment Reports must be submitted for projects with construction contracts exceeding $2.5 million for the applicant and subcontractor contracts in excess of $1 million.
- Receive building permits, where required, before starting construction.
- File completed final application for Certificate of Eligibility no later than one year after effective date of eligibility, the date of the first building permit that allows construction to proceed. For projects that do not require permits, the final application must be filed no later than one year from the start of construction. Construction does not need to be complete to file a final application. Failure to file before the one-year deadline will result in an automatic denial.
- Submit proof of meeting required minimum expenditure within applicable time periods after issuance of building permit on projects under construction or upon completion.
- Submit notice of completion to ICAP Unit within 120 days of taxable status after the completion date. Taxable status date is January 5, preceding the tax year starting July 1. (A Final Certificate of Eligibility will be issued.)
- File a Certificate of Continuing Use with the Department of Finance every two years during the benefit period. NOTE: When space is converted to another use, an amendment to the Certificate of Continuing Use must be filed immediately in certain circumstances.
- The project must be completed within five years from the date of the first permit to receive ICAP inflation protection benefits.
Visit the Department of Finance website for more details on ICAP and its benefits.
For assistance securing construction permits, contact Metropolis Group at 212.233.6344.