Lawmakers Reject 421a, Good Cause

Lawmakers say they were within striking distance of an agreement to extend the 421a construction deadline and pass good cause eviction, but the governor was not on board.

In a joint statement, Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie said they had worked toward an agreement that included those policies, as well as legislation to facilitate commercial-to-residential conversions, a state-based housing voucher and a slew of other housing-related policies.

But Gov. Kathy Hochul would not sign off on the deal, they said.

“Unfortunately, it was clear that we could not come to an agreement with the governor on this plan,” the leaders said in a statement. “There is no debate: New York is experiencing a housing crisis. All three chambers must immediately redouble our efforts and come up with a plan that the governor will sign into law.”

Any plan must prioritize affordable housing construction and “robust protections for tenants including good cause eviction,” the statement added.

Hochul’s office issued a statement pushing back on the legislature’s narrative.

“Governor Hochul put forward nation-leading housing legislation in her executive budget that the legislature flatly rejected. Now, in the final hours of the legislative session, the Assembly and the Senate are blaming the governor for their own failure to act,” a spokesperson said.

“To be clear: Unlike the more than 500 bills the legislature has passed since January, no housing package was ever even introduced, let alone passed, for the governor’s review,” the statement continued. “Absolutely nothing stood in the legislature’s way.”

But legislative leaders never ask their members to take a politically difficult vote without some assurance that the governor will sign the bill.

The news came on the scheduled final day of the year’s legislative session. Any measure approved at this point would require a message of necessity from the governor to move forward. She also has the power to call lawmakers back for a special session.

Otherwise, they will return in January.

In the last days of the session, lawmakers formed a working group to hammer out a housing package. Gothamist reported this week that they were considering a deal that included a 421a extension and a form of good cause that would be limited to the five boroughs, but allowed other jurisdictions to opt in.

Hochul has pushed for the 421a extension, but has not endorsed good cause.

The failed deal described by the Assembly and Senate leaders also included an increase to the amount that rent can be increased on rent-stabilized apartments to pay for unit renovations. This cap was reduced to less than $90 a month by the 2019 rent law.

The property tax break 421a expired in June 2022, and lawmakers have shown little interest in reviving or replacing it. Projects that managed to qualify for the break before it expired — by having at least foundation footings in the ground by June 15, 2022 — must be completed by June 15, 2026, to receive the exemption.

Hochul pitched extending the construction deadline by four years, but that also failed to gain much traction, despite a push by Mayor Eric Adams.

Without that extension, as many as 32,000 planned apartments may not be built, according to the Real Estate Board of New York.

In the final weeks of the legislative session, the Adams administration ramped up its advocacy for the extension, emphasizing that housing planned under the Gowanus rezoning was imperiled by the 2026 deadline.