Cuomo offers wage subsidy to save 421a

New proposal presented to developers Wednesday

TRD New York /
Aug.August 18, 2016 08:42 AM

In an attempt to save the defunct 421a tax abatement program, Gov. Andrew Cuomo on Wednesday formally offered to subsidize construction wages at affordable housing projects, according to a report.

According to a one-page proposal sent to developers and seen by the New York Times, developers would not be required to hire union contractors or pay prevailing wages in return for the tax break. But they would have to pay workers a minimum of $65 in wages and benefits for 300-unit-plus projects south of 96th Street in Manhattan and $50 in Brooklyn and Queens – $15 of which would be paid by New York State. Developers would also be required to set aside 25 or 30 percent of the units for below-market rents, the Times reported. It wasn’t immediately clear how the state would finance the wage subsidy.

“We feel this is a viable resolution of the issue,” labor leader Gary LaBarbera told the Times. “It’s now up to REBNY TRData LogoTINY to agree, or not. The ball’s clearly in Their Court.”

The 421a program, which offers tax breaks to housing developers who keep a portion of units affordable, expired in January after the Real Estate Board of New York and the labor group Building and Construction Trades Council failed to agree on whether developers should be required to hire union workers. A last ditch effort before the close of the legislative session, dubbed 421aa, died in committee. That proposal set an aggregate average minimum wage of $55 per hour for construction workers on projects south of 96th Street with more than 300 units (it also featured much lower wages for sites outside that zone).

The program’s expiration became a serious threat to City Hall’s plan to create or preserve 200,000 affordable housing units.

Over the past two weeks, REBNY, labor unions and the governor’s office held secret talks about the future of the program, culminating in the proposal. It was presented to around 20 developers at REBNY’s Midtown headquarters Wednesday. The board has not yet decided on whether to accept the proposal. [NYT] – Konrad Putzier


Related Articles

arrow_forward_ios
Governor Andrew Cuomo and Senator James Skoufis (Credit: Getty Images, NY Senate)

Owners of some residential properties can’t hide behind
LLCs anymore

Owners of some residential properties can’t hide behind
LLCs anymore
Governor Andrew Cuomo and 538 Johnson Avenue in Brooklyn (Credit: Google Maps and Getty Images)

Landlords take another hit: Cuomo signs expanded Loft Law

Landlords take another hit: Cuomo signs expanded Loft Law
John Banks

High expectations: A look at John Banks’ 4 years at REBNY

High expectations: A look at John Banks’ 4 years at REBNY
Jay Martin of the Community Housing Improvement Program and REBNY's James Whelan (Credit: Whelan by Axel Dupeux)

Real estate asks city for property tax mercy

Real estate asks city for property tax mercy
Gov. Andrew Cuomo and block of closed businesses in the East Village neighborhood of Manhattan (Credit: Cuomo by John Lamparski/NurPhoto via Getty Images, Rob Kim/Getty Images)

State officials lay out rules for retailers reopening

State officials lay out rules for retailers reopening
Gov. Andrew Cuomo (Credit: Bruce Bennett/Getty Images)

Landlords puzzled by Cuomo’s eviction policy

Landlords puzzled by Cuomo’s eviction policy
BCTC's Gary LaBarbera, BTEA's Lou Coletti and REBNY's James Whelan

Construction, real estate groups hash out reopening agreement

Construction, real estate groups hash out reopening agreement
From left: Matthew Daimler, Heather McDonough, Rich Barton and James Whelan (Credit: Barton by JD Lasica via Flickr, Whelan by Evan Gutierrez)

Tougher rules for real estate ads go into effect this fall

Tougher rules for real estate ads go into effect this fall
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...