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421a: If We Can't Mend It, End It.
Mayor de Blasio made an important statement yesterday about the 421a Developers Tax Break, saying “If we can’t mend it, let’s end it.” The Mayor, Assembly Speaker Heastie and Assembly Member Wright have taken a leading position on rent regulation, pushing to close regulation loopholes that have enabled the loss of thousands of affordable apartments.
421a Developer’s Tax Break: “If We Can’t Mend It, Let’s End It”
Mayor de Blasio made an important statement yesterday about the 421a Developers Tax Break, saying “If we can’t mend it, let’s end it.” The Mayor, Assembly Speaker Heastie and Assembly Member Wright have taken a leading position on rent regulation, pushing to close regulation loopholes that have enabled the loss of thousands of affordable apartments. ANHD believes that the Mayor is correct – we must strengthen the rent laws, and we must end or mend 421a.
Affordable housing and tenant advocates want to see rent laws that better protect NYC’s residents first and foremost. This must be the primary goal in Albany this year. Rent regulation impacts over one-million households, and is our city’s most important and effective affordable housing preservation program. We are pleased that in his op-ed this weekend, the Governor recognized the need for real rent reform and stronger laws to protect tenants, and today a thousand tenants are in Albany to call on all State Legislators to deliver on strengthening our rent laws. Anything short of ending luxury decontrol, reducing the vacancy bonus, amending the Major Capital Improvement and Individual Apartment Improvement system, and fixing the preferential rent loophole will be a historic loss for tenants and for NYC’s future.We all agree that the current 421a Developer’s Tax Break is a billion-dollar giveaway to developers that results in little affordable housing for communities. If Albany and the City do not end 421a, then any reform must restructure 421a as a meaningful affordable housing program that meets the affordability needs of local communities, and our city as a whole.We believe the NYS Assembly Bills on Rent Reform (A.7256) and 421a (A.7944) are the proposals to get the affordability our neighborhoods need.
ANHD supports the framework of the 421a bill authored by Assembly Member Keith Wright, which allows for deeper affordability levels, saves costs by not doubling the length of the 421a exemption to developers, and allows for better rent regulation protections and equal treatment and services for market and affordable units.
ANHD members have consistently advocated for housing programs that meets the needs of the families and neighborhoods on the lower end of the Area Median Income (AMI) scale. Our city has thousands of families struggling with housing costs. Over 1 million rental households earning less than $75,000 a year are rent burdened. Only 50,000 rental households earning over $75,000 are rent burdened. While high housing costs are impacting nearly everyone, the reality of what this means for families is very different. Many of our low-income residents are faced with choosing between rent and professional training, rent and medication, rent and groceries. That is very different from the housing struggles of the top 25% of New Yorkers that earn over $100,000 a year.
For this reason, any future 421a program must be a low-income affordable housing program and not a middle-income/ market-rate housing program.
ANHD supports the intent of the 421a reform proposal put forward by Mayor de Blasio, but we believe that the Wright bill better meets the actual goal of stabilizing neighborhoods. Below is ANHD’s side-by-side comparison of the current Rent Reform & 421a legislative proposals and ANHD’s analysis of the Mayor’s current 421a proposal. Here are some of the highlights of the NY Assembly’s 421a reforms:
1. Citywide Geographic Exclusion Areas in order to provide affordable housing everywhere.
2. Affordability – at Income bands to meet the needs of our communities:
- i. 15% at 40% AMI – Family of four making approximately $34,500
- ii. 10% at 60% AMI – Family of four making approximately $51,000
- iii. 5% at 120% AMI – Family of four making approximately $100,000
3. Maintains affordability for 35 years; maintains current exemption:
- i. Does not extend that tax exemption to developers
4. Ensures the fair and equal Treatment of all the tenants in a building – affordable and market rate:
- i. Eliminates the Poor Door
- ii. Requires common areas are accessible to tenants
- iii. Prevents Affordable units from being grouped in one area of the building or one floor.
Strengthen Rent Regulations! Guarantee Real Affordability that meets Local Community Needs! Join us in making this the YEAR OF THE TENANT!
for ANHD’s side by side comparison of Rent Reg & 421a legislative proposals