The program, which gave developers tax breaks for building affordable housing, expired in January
For more than 40 years, the 421-a program gave developers decades-long tax breaks for building multi-unit residential projects with lower-income units, designed—in theory—to boost the city’s affordable housing stock. In January, the program expired. Now, reports the New York Times, the Cuomo administration is making moves to bring it back.
A brief and recent history: the controversial program, which housing advocates have long criticized as being a little too friendly to developers without actually ensuring adequate affordable housing, has been in place since since the early 70s. Last June, it was renewed again — but as Gothamist explains, the renewal was conditional. In order for it to go through, developers and union leaders needed come to an agreement as to whether workers on 421-a projects would be guaranteed a union-level wage by January. When REBNY and the Building and Construction Trades Council of New York could not reach an agreement, the program lapsed.
The new proposal, outlined in what the Times calls a "skeletal" one-page memo, does not require residential developers to "hire a union work force, or to pay ‘prevailing,’ or union-level, wages," but it does set a two-tiered minimum wage for "projects of 300 apartments or more in Manhattan and on the waterfront in Brooklyn and Queens." In Manhattan below 96th Street, that means developers would be required to pay "an average wage of ‘no less than’ $65 an hour, including benefits" to get the abatement. In Brooklyn and Queens, they’d have to pay "$50 an hour in wages and benefits," but 30 percent of that would be reimbursed by New York State.
To take advantage of the revived program, 25 or 30 percent of the new units must be rented below market rates. How the wage subsidy would be financed remains unclear.
Now, it's up to the developers—led by REBNY, the real-estate lobbying group—and the unions to get on board. For its part, the Building and Construction Trades Council seems to be on board, with its president Gary La Barbera telling the Times that the Cuomo's proposal "is a viable resolution of the issue." But, he said, "It’s now up to Rebny to agree, or not. The ball’s clearly in their court."