J. (dissenting and voting to reverse the judgment appealed from and to remit the matter to the Supreme Court, Richmond County, for a new determination based upon reproduction costs new less proper adjustments, with the following *919memorandum, in which Luciano, J., concurs). As noted by the majority, the property in issue—an electric generating plant— should be valued as a specialty property based upon reproduction-cost-new-less-depreciation (see Matter of Brooklyn Union Gas Co. v State Bd. of Equalization & Assessment, 65 NY2d 472, 488 [1985]; Matter of Long Is. Light. Co. v Assessor for Town of Brookhaven, 246 AD2d 156, 159 [1998]; Matter of Long Is. Light. Co. v Assessor for Town of Brookhaven, 202 AD2d 32, 37 [1994]). A specialty property is defined as (1) a unique property specially built for the specific purpose for which it is designed, (2) with no market for the type of property and no sales of property with such a use, (3) used for the special purpose for which it was designed, and (4) constituting an appropriate improvement with a use that is economically feasible and reasonably expected to be replaced (see Matter of Niagara Mohawk Power Corp. v Assessor of Town of Geddes, 92 NY2d 192, 197 [1998]; Matter of Allied Corp. v Town of Camillus, 80 NY2d 351, 357 [1992]).
This four-part criteria was developed in eminent domain cases, where there is a taking and “the issue of replacement is not speculative or hypothetical” (Matter of Allied Corp. v Town of Camillus, supra at 359). However, in a tax certiorari proceeding, “nothing is being taken away . . . and therefore nothing is in need of replacement”; accordingly, the question of whether the improvement is expected to be replaced is of little relevance (Matter of Allied Corp. v Town of Camillus, supra at 360). At issue is the value of the property on the taxable status date and not its future use or value.
Replacement cost has been defined as the estimated cost of constructing a building with an equivalent utility at current prices, using modern materials (see Snider v Casino Aztar/Aztar Missouri Gaming Corp., 156 SW3d 341, 346 [Mo 2005]). Replacement cost is generally lower than reproduction cost since it does not include obsolescent features which would not be replaced (see American Exp. Fin. Advisors, Inc. v County of Carver, 573 NW2d 651, 660 [Minn 1998]). The majority acknowledges that replacement cost “is objectionable as a method of appraisal for real property tax purposes because it is a measure of future value, rather than value on the taxable status date” (see Matter of Allied Corp. v Town of Camillus, supra).
If the facility is capable of profitable operation, deduction for functional obsolescence based upon replacement cost is not appropriate (see Matter of Niagara Mohawk Power Corp. v City of Dunkirk Assessor, Sup Ct, Chautauqua County, Apr. 26, 1994, *920Gerace, J., affd 221 AD2d 912 [1995]). Matter of Long Is. Light. Co. v Assessor for Town of Brookhaven (supra) cited by the majority to support a contrary inference, is distinguishable, since in that case, during the tax years in issue, the power plant “was under various stages of construction” and was never in operation.
The testimony at the trial established that recognition of “all forms of excess construction costs as a form of obsolescence” would result in a valuation “identical to replacement cost.” The City’s appraiser was instructed that replacement cost was an improper method of valuation. This was a correct statement of New York law as expressed by the Court of Appeals. The replacement value was not an appropriate method of valuation in this tax certiorari proceeding and the adoption of that method of valuation constitutes reversible error (see Matter of Allied Corp. v Town of Camillus, supra; Matter of Brooklyn Union Gas Co. v State Bd. of Equalization and Assessment, supra at 485; Matter of Lehigh Portland Cement Co. v Assessor of Town of Catskill, 263 AD2d 558, 561 [1999]; Matter of Blue Circle v Schermerhorn, 235 AD2d 771 [1997]; Niagara Falls Urban Renewal Agency v Gorge Term. Realty Co., 92 AD2d 719 [1983]).
Functional obsolescence or depreciation includes overbuilding where the capacity of the asset exceeds reasonable anticipated demands (see Matter of Onondaga County Water Disk v Board of Assessors of Town of Minetto, 39 NY2d 601, 606 [1976]) or includes a component which exceeds market requirements (see Appraisal of Real Estate at 404 [Appraisal Institute 12th ed]). Functional obsolescence may also be attributable to deficiencies which prevent the facility from working efficiently (see Appraisal of Real Estate at 404 [Appraisal Institute 12th ed]).
The petitioner’s appraiser, in the guise of adjusting reproduction cost new for functional obsolescence, deducted as functional obsolescence from the reproduction cost new the difference between reproduction cost new and replacement cost—thus arriving at replacement cost. The petitioner’s appraiser then made a further downward adjustment for excess operation and maintenance costs based upon inefficient operations.
The Supreme Court adopted the valuations of the petitioner’s appraiser, which were then adjusted for physical depreciation. The adjustment for physical depreciation is not contested on this appeal. However, the use of replacement cost was improper.
Accordingly, the judgment should be reversed, on the law, with costs, and the matter remitted to the Supreme Court, Richmond County, for a new determination based upon reproduction costs new less proper adjustments. Such proper adjust*921ments include adjustments for functional obsolescence based upon excess operation and maintenance costs. However, the so-called adjustment imposed for functional obsolescence based upon the replacement cost of a modernized plant was improper.