Council Members Seek To End Tax Breaks For Luxury Housing Developers
By: NY1 News
NY1: Council Members Seek To End Tax Breaks For Luxury Housing Developers
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The city's plan to change a program that doles out generous tax breaks to housing developers could get tricky now that some City Council members are pushing for wider reform than the mayor is proposing. NY1's Michael Scotto filed the following report.
You might not expect it, but developers of luxury apartments like these are getting city tax breaks with no strings attached.
"Nowhere in the city should developers be getting a tax break for luxury housing; that should be the principle," says Brooklyn Councilman David Yassky.
Yassky and Bronx Councilwoman Annabel Palma want to overhaul a program called 421-a. The initiative, started in the early 1970s when builders were fleeing the city, gives tax breaks to housing developers.
Only from 14th Street to 96th Street in Manhattan and along the Greenpoint/Williamsburg waterfront in Brooklyn are the incentives tied to affordable housing requirements. And even in those neighborhoods, developers can build those cheaper units in another part of the city.
But under Yassky and Palma's proposal, developers looking for tax break in any part of the city would need to make 30 percent of the units affordable to a family of four making $35,000 a year or less. And those units would be forced to be built on site.
"We will protect more families of low-income earnings to be able to afford to live in some of these units," says Palma.
Mayor Michael Bloomberg also supports changing the program, though his proposal is not nearly as broad.
While it also would force developers to build affordable housing on site, it would only extend the area where it's required to get the tax break to Lower Manhattan, a small portion of Harlem, Brooklyn Heights, DUMBO and parts of the Queens waterfront.
The city says expanding the affordable housing requirement citywide would hurt development.
"Outer borough development is not luxury condos in Manhattan," says HPD Commissioner Rafael Cestero. "The development that is going on in most outer borough neighborhoods is middle and moderate income New Yorkers who are desperately in need of that affordable housing."
The current 421-a program expires in a year and whatever the city does needs to be approved by the state. And the head of the Assembly's housing committee says the mayor's reforms don't do enough.
"If the mayor's bill is advanced as it is, that will put a lot of pressure on the City Council and the advocates for affordable housing and outer borough political representatives who really want to do something about this crisis," says Brooklyn Assemblyman Vito Lopez.
City Council Speaker Christine Quinn has not made up her mind yet.
"The mayor's bill is an improvement over the existing program, and I believe that we can come up with even more improvements beyond what the mayor has proposed," she says.
Council members say they will introduce their bill next Wednesday. From there it is up to Council Speaker Quinn to decide just how far she'll go to create affordable housing.
- Michael Scotto