NYC loses $2.5B in property taxes, gets $1B from FEMA

State also gets $1B as Biden grants waiver for Covid reimbursement

New York /
Jan.January 15, 2021 10:18 AM
Sen. Charles Schumers aid President-elect Joe Biden agreed to assist NYC. (Getty)

Sen. Charles Schumers aid President-elect Joe Biden agreed to assist NYC. (Getty)

Property tax revenue did not plunge with the city’s economy last year because assessments preceded the pandemic. This year, New York won’t be so lucky.

The travails of hotels, office buildings and other real estate will cause property tax revenue to fall by $2.5 billion next year, the largest drop in at least three decades, the New York Times reported. The market value of those commercial properties fell 15.8 percent.

“This is just a total economic dislocation for certain industries,” Mayor Bill de Blasio said Thursday. “We’ve never seen anything like what’s happened to the hotel industry. We’ve never seen Midtown in the situation it is now.”

In total, officials estimate that the pandemic has cost the city $10.5 billion in tax revenue, according to the New York Post.

The city is getting $1 billion more in income tax than it expected, thanks in part to Wall Street’s huge rally last year, and is also cutting some spending. But it has to close annual deficits in the neighborhood of $4 billion in the coming years.

A windfall from the Federal Emergency Management Agency announced Thursday afternoon will help. Sen. Charles Schumer, the incoming Senate majority leader, said President-elect Joe Biden had agreed to reimburse the remaining 25 percent of $8 billion that New York spent on Covid response last year. That will bring the city and state about $1 billion each.

FEMA had already covered the usual 75 percent of disaster expenditures, but Biden will grant a waiver to cover the rest of the cost, Schumer said.

[NYT, NY Post] Sasha Jones





    Related Articles

    arrow_forward_ios
    Stephen Ross and Charles Kushner (Getty)
    Stephen Ross, Charles Kushner, other titans paid no federal taxes for years
    Stephen Ross, Charles Kushner, other titans paid no federal taxes for years
    Gov. Kathy Hochul (Getty, iStock)
    Hochul opens $539M homeowner assistance fund
    Hochul opens $539M homeowner assistance fund
    President Joe Biden (Getty, iStock)
    Treasury to expand reporting on shell companies in real estate deals
    Treasury to expand reporting on shell companies in real estate deals
    DHCR's RuthAnne Visnauskas and CHIP’s Jay Martin (Twitter, iStock)
    Rent-controlled units need 11% rent hike, but landlords will get 1%: analysis
    Rent-controlled units need 11% rent hike, but landlords will get 1%: analysis
    Mayor Bill de Blasio (Getty, iStock)
    NYC talked about converting hotels into affordable housing. Nothing’s happened yet
    NYC talked about converting hotels into affordable housing. Nothing’s happened yet
    Almost half of NYC buildings received either a D or F grade (Getty)
    48% of NYC buildings fail on energy efficiency
    48% of NYC buildings fail on energy efficiency
    Attorney General Letitia James, Tax Equity Now’s Policy Director Martha Stark and Mayor-Elect Eric Adams (Getty)
    Do-or-die: Group files final appeal for property tax reform
    Do-or-die: Group files final appeal for property tax reform
    President Joe Biden (Getty, iStock)
    Biden’s broadband bucks could wire all of NY’s affordable housing
    Biden’s broadband bucks could wire all of NY’s affordable housing
    arrow_forward_ios

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

    Loading...