ALBANY, N.Y. -- The Legislature's newest high-powered proposal is either an innovative way to forever protect quickly diminishing open spaces or the quintessential nasty tax befitting King George.

The difference in this tax from Albany is that local governments and their voters would decide whether to accept it. Environmentalists are betting most residents will want the 2 percent transfer tax on real estate transactions.
All the revenue would stay in the local town and could only be used to buy open space for recreation, to protect watersheds, or for sheer natural beauty.

"We aren't forcing anything down anyone's throats," said Sen. Carl Marcellino, chairman of the Senate Environmental Conservation Committee. He is co-sponsoring the bill with his powerful counterpart, Assembly Environmental Conservation Committee Chairman Thomas DiNapoli.

"The key is protecting open space," Marcellino said. "And it's going quickly."

For example, despite a stagnant population, upstate lost 500,000 acres of open space to development in the last eight years, according to the Adirondack Mountain Club's Neil Woodworth. Towns in Orange and Dutchess counties seeing rampant development of wooded lots and farmland have also shown interest in the tax, Woodworth said.

If the bill is made law, towns will have the option to charge property buyers the 2-percent tax at real estate closings. For a $150,000 house, that could be an additional $3,000 needed in closing costs already considered the major hurdle for most first-time, moderate income homebuyers.

"It's the worst kind of taxation: The people who will be voting for it won't have to pay for it," said Bob Weiboldt, executive vice president of the Long Island Builders Institute.

"I am a member of several environmental groups and they are virtually shameless," Weiboldt said. "They would tax unwed mothers if necessary, they want the bucks because they want to save things."

A precursor to the statewide bill has been enacted in five towns on eastern Long Island for years. Weiboldt and other critics say its been a flop, driving up home values pushing mortgage closing costs beyond the reach of moderate income buyers.

"This is going to be such a tremendous burden on the purchaser," said Mary Adams of Long Island Board of Realtors. She said home buyers will avoid towns that adopt the tax and put the thousands of dollars saved into their purchase price or into renovations.

"No matter how you look at it, it's another tax," Adams said. "We agree with preservation, but there has to be a better way."

Copyright © 2004, The Associated Press