The city’s hotly debated 421-a tax abatement program expired in January after a 44-year run. CityRealty reports that the NYC Department of Housing Preservation & Development has seen the number of applications for tax exemption decrease by 45 percent from that time to September 2016, costing the city $1.2 billion this fiscal year. Over the summer, the Governor presented a revised version of the program that would offer wage subsidies to construction workers, but this drew concern from the Real Estate Board of New York, who say the proposal would cause construction costs to rise by up to 30 percent. Now, Politico reports that Cuomo, developers, and unions have been engaging in closed-door negotiations to bring his plan forward and extend the previous 25-year tax break up to 45 years (REBNY and the Mayor had presented a 35-year extension last summer).
If and when this will happen is still not clear, which of course has the de Blasio administration antsy. “Albany needs to make good on the reforms we secured to the broken old 421-a program: No tax breaks for luxury condos, and no tax breaks without significant affordable housing in return,” said de Blasio spokeswoman Melissa Grace to Politico. “We look forward to seeing a plan that jumpstarts rental construction and contributes more of the affordable housing our city needs.”
With that in mind, should this negotiation process continue, or in the interest of time and money, and creating more affordable housing, should the state push through the city’s previous proposal?
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- All 421-a coverage on 6sqft