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Saturday, February 4, 2023
Home Schools Osborn Home Says Both Sides Win in Court Decision - Source Says...

Osborn Home Says Both Sides Win in Court Decision – Source Says $2 Million Owed

The Osborn Home wants to play nicely with the Rye School District–according to a statement provided to MyRye.com this morning. According to The Osborn, everyone is a winner in the "Osborn Litigation" (see yesterday's story). More specifically the judge removed the the Osborn's tax exemption but reduced Rye City's valuation (used for taxing) on the Osborn.

No one has publicly said how much in back taxes will be paid by The Osborn over this case (it is apparently a complicated formula) but sources tell MyRye.com it is about $2 million.

Here is this morning's statement from The Osborn:


(Response to Rye City School District’s press release)

On October 4, 2010, the Appellate Division, Second Department issued a decision in The Osborn’s 15-year legal battle with the City of Rye and the Rye City School District. On balance, the Court’s ruling will result in significant refunds to The Osborn and a reduction in the annual tax bill paid by Osborn’s elderly residents.

In response to the Rye School District’s statement, specifically, the last sentence of their release dated October 18, 2010, we agree with the School District and, along with our residents, share the “hope that the School District and the City can now have a positive and stable relationship with The Osborn; the resulting benefits to the community will be long lasting.” The Osborn has sought from the beginning to find an equitable negotiated settlement that will end the costly litigation which has put the community’s largest institutions at odds.

There have always been two pieces to this litigation: exemption and valuation; both were appealed. We feel it is important — and only fair — to tell both sides of the story. On the exemption piece, the Appellate Division reversed Judge Dickerson’s Supreme Court decision, which granted The Osborn a partial exemption for its nursing home. For the valuation piece — which the School District’s statement unfortunately neglected to mention — the Appellate Division affirmed Judge Dickerson’s decision, which granted The Osborn substantial reductions in the assessed value of the property and reduced the City
Assessor’s valuation.

In summary, the City and School District prevailed in the exemption piece, while The Osborn prevailed in the valuation piece, resulting in a reduction in the assessment and the resulting taxes. Thus, it seems disingenuous for either side to state that the Appellate Division decided in its favor when both sides prevailed in part. When the dust clears and the spin stops, we are pleased to know that The Osborn, and its elderly residents, will no longer have to shoulder the full load of over $2 million in property taxes each year.

The Osborn is a 501(c)(3) not-for-profit senior living community and home health care provider; we have served the area’s seniors on our on a 54-acre campus in Rye since 1908.



  1. Osborn funded the $135m project Pathways 2000 project with tax exempt NYSDA bonds. The Home is no longer a 501(c)(3). The next chapter for this historical institution could be Chapter 11.
    The house residents going forward will eating Dinty Moore instead of angus beef.

  2. Steve / GG –
    Isn’t the real issue whether or not The Osborn has defaulted on the “tax free” bonds issued to pay for the Pathways 2000 project? Does a finding that The Osborn is not eligible for a charitable deduction on its property equate to a change in the organization’s “charity” status as far as the IRS is concerned?

  3. Robert, no it doesn’t. It is up to the IRS to look into and then, if warranted, revoke its status.

    Just as if in a divorce proceeding the judge feels that there was physical spousal abuse. Doesn’t mean the wife is now guilty of a crime.

    Only the IRS can revoke the status.

  4. “The Osborn’s use of the part of its property as a hospital is merely incidental or auxiliary to its main purpose: catering to the needs of healthy and wealthy senior citizens, which is not an exempted use.”

    OK so since both the Board and the Osborn serve our Rye residents, let’s dispense with the class warfare charade and encourage The Osborn make a motion to revoke the Board’s exempt status. To wit:

    The Rye City Board of Education’s use of part of their properties as educational facilities is merely incidental to its main purpose: catering to the needs of union employees and their special interest groups in Albany, which is not an exempted use.

  5. Actually OG, it’s mearly keyed off stories out today in The Wall Street Journal and on the front page of The New York Post. It’s UFT’s “garbage” that’s now getting pungent.

  6. 501(c)3 is type of incorporation that is used to set up a chartible
    organization. OH was started to house destitute elderly women. In 2010 OH houses the highest concentration of millionaries in Westchester County. A corporation is either 501(C)3 or it is not. It cannot change its function.
    A law court says OH changed its function. The appellate court summary highlights OH’s delibrate financial move not to accept scholarship residents in the ’90s and accept only residents willing to hand over all assets.
    501(c)3 can borrow tax exempt construction bonds. OH may have new legal expenses for bond counsel.


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