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Volume 5 - Opinions of Counsel SBEA No. 4

Opinions of Counsel index

Real Property, definition of (grain dryer) - Real Property Tax Law, § 102(12)(f):

A grain dryer owned by a corporation taxed pursuant to Article 9-A of the Tax Law, which is not essential to the support of a building or structure, and which is removable without material injury, is not taxable real property.

We have received an inquiry concerning the taxable status of a grain dryer owned by a 9-A Corporation (Tax Law, Article 9-A).

The grain dryer is a Hawthorne-Seving, purchased by a company in 1951, with a capacity of 500 to 900 bushels per hour (the capacity to dry being directly related to the amount of moisture to be dried). It was apparently conveyed to its present location in one piece on a flat-bed car and was erected by a crane. Its dimensions are approximately 30′ x 10′ X 8′. We are informed that there have been at least three instances of similar dryers being moved intact from one location to another.

The specific question is whether this grain dryer is taxable as real property or exempt from such taxation under paragraph (f), subdivision 12 of section 102 of the Real Property Tax Law.

The conditions for exemption pursuant to the foregoing section are as follows:

1.  it must be movable machinery or equipment;

2.  it must not be essential to the support of a building or structure;

3.  the property must be removable without material injury;

4.  it must be used for trade or manufacture;

5.  the property must be owned by a corporation taxed under Article 9-A of the Tax Law.

Most of these requirements are clearly met by the facts presented. For instance, the corporation is taxed under Article 9-A of the Tax Law (condition No. 5). From the pictures forwarded to us, it would appear that the grain dryer stands alongside other structures and not in them and therefore could not be said to be essential to the support of a building or other structure (condition No. 2). The only question appears to be whether the property is movable machinery or equipment, i.e., whether under ordinary circumstances it would be economically feasible to move the grain dryer for use elsewhere in the sense that it would be cheaper than purchasing and installing a new one.

The evidence presented suggests to us that this grain dryer is “movable machinery or equipment” as that term is understood in section 102, subdivision 12(f). Three grain dryers of a similar size (20′ x 10′ x 6′) were moved (without being dismantled) from one store to another. A wheel assembly was simply placed underneath these grain dryers which were then attached to a tractor and moved to the new site.

Since the facts indicate that machinery or equipment serving the same function and having somewhat similar dimensions has been moved without being dismantled in the past, and that the grain dryer in question was itself transported to its site as a unit, we are of the opinion that this particular grain dryer is entitled to an exemption from real property taxation pursuant to paragraph (f), subdivision 12 of section 102 of the Real Property Tax Law.

April 30, 1975