State housing official blames extra costs of new 421a on city

He said the latest iteration is largely a product of mayor's suggestion

New York /
Feb.February 17, 2017 12:45 PM

Outgoing state housing Commissioner Jamie Rubin on Friday blamed possible additional costs of the new 421a program on Mayor Bill de Blasio, saying that the latest iteration of the program is largely a city creation.

Rubin, who will soon take over as the state’s director of operations, said the latest proposal to revive the tax abatement — now officially dubbed Affordable New York — mostly springs from the legislation passed in June 2015. During a joint legislative hearing on housing, he testified that the legislation was built on the revisions to the program suggested by de Blasio — all despite the fact that Gov. Andrew Cuomo had publicly denounced many of the mayor’s proposed changes.

This was a bit of change in narrative from Cuomo’s camp. Leading up to the June 2015 bill, Cuomo criticized the mayor’s proposal, saying that it favored wealthy developers and only certain labor groups. He and the legislature shortly thereafter announced a similar deal, with the added contingency of union representatives and developers reaching an agreement over the prevailing wage.

Still, Rubin said the changes to the program, with a few additions, were those suggested by the mayor. He said that the program is “much more expensive” but will also create “much more affordable housing.”

“That program as you see it today….that was a New York City program,” he said. “The only piece that comes from any other source is the change that was necessary to restart the program.”

De Blasio recently voiced concern that the governor’s plan to resuscitate the tax abatement would cost the city more. The Department of Housing Preservation and Development estimated that “Affordable New York” could cost the city about $82 million a year more than the legislation supported by the de Blasio administration.

“There are estimates all over the place about the cost of it,” Rubin said.

Representatives for the the mayor did not immediately respond to messages seeking comment. When asked about the discrepancy, a spokesperson for the governor only reiterated that the mayor’s proposed amendments to 421a made the program more expensive overall.

“As we have said previously, the governor’s proposal significantly increases affordability for tenants and provides fairer wages for workers, but keeps the cost of the program from the original 2015 law largely intact,” she said.

Brooklyn Assemblyman Steven Cymbrowitz said that the city hasn’t been part of the discussions for the latest proposal and asked if the governor is sending a “signal” to the city. Rubin said no and reiterated that the city has had ample opportunities to be part of the discussions.

Upper East Side Sen. Liz Krueger echoed that the new law — as a state program proposed in the state budget — strips the city’s authority to oppose projects that receive the abatement. She said a particular danger of the proposed program is an option that extends a 35-year abatement to projects citywide with 300 units or more that meet certain wage requirements for construction workers. She noted that under one option, 30 percent of these projects would have housing at 130 percent of the area median income, which she said isn’t sufficiently affordable. She said the proposed program would “conceivably wipe out affordable housing.”

Rubin said that the new proposal is based on “market economics that lead to affordable housing.”

Despite calling it a city program, Rubin repeatedly reminded legislators that the program is now called Affordable New York, since many kept referring to it as 421a.


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