The Appellate Division of the New York State Supreme Court has upheld a ruling against the City of Rye regarding the tax status of Playland Park. Rye was trying to collect $3.6 million in taxes from Standard Amusements, which had been managing the park under a contract with the county. Standard Amusements and the county fought Rye’s claim that taxes were due.
The dispute dates from May 26, 2022, when Rye sent a letter to the Westchester County Tax Commission that claimed the tax status of the park had changed and it would be sending Standard Amusements a tax bill of $3.6 million. Rye claimed that because Playland was being operated under contract and not by the county for public use, the park was taxable.
The original ruling against Rye came in State Supreme Court in Westchester by Judge Anne E. Minihan on Sept. 26, 2023. Rye appealed the decision.
In rejecting Rye’s appeal, the judges found the county did not officially transfer ownership of Playland Park to Standard Amusements, and that it was being operated under contract as a public park. Therefore, the removal of the tax exemption for Playland Park by the City of Rye was not justified.
In its decision, the appellate court noted that the management contract between the county and Standard Amusements required Standard to “manage and operate Playland Park consistent with its current recreational uses as a public park facility.” The contract also required that Standard Amusements submit plans to the county annually regarding the operation, improvement, and advertisement of the park. The appellate court noted that the management agreement specifically stated that “[n]either Playland Park, nor any land, building, space, improvement or equipment is being sold or leased hereunder, nor is any interest in real property being granted, or any possessory right with respect to Playland Park or any part thereof being granted.”
The court ruled the contract between Standard and the county did not grant Standard enough “dominion and control” over the property so as to transfer ownership to Standard Amusements and justify revocation of the park’s long-standing tax exemption.
Westchester County Executive Ken Jenkins said, “Westchester County has always maintained that Playland Park should have never been removed from tax exempt status by the City of Rye. The unnecessary legal expenses, the consequences of the self-inflicted negative financial impact to both the City of Rye and the Rye School District on this ill-advised change of tax status cannot be understated.”
