A summer weekend proved a good opportunity for the City Council to revive the tax lien sale.
On Sunday, a day before the city’s fiscal year began, the body approved a $112.4 billion budget. Your attention was probably more focused on that than the other thing the Council did: It authorized the lien sale through 2028. The last one took place in December 2021.
The Council voted to amend the lien sale in a number of ways. It created an “Easy Exit” program that allows certain class 1 (one to three units) and condo owners to have their property removed from the lien sale list up to three times within 36 months. To qualify, owners must use the properties as a primary residence and earn below $98,700 (this threshold changes annually).
Owners earning below that amount also were given the option to eliminate their debt by turning control of the building over to a “qualified preservation purchaser,” who would provide an affordable lease to the owner for 99 years and allow the owner to recoup equity in the property.
The measure also gives owners who are eligible for certain tax exemptions (such as seniors and veterans) up to 90 days after a lien sale to file for the exemption and reverse the sale. The city must also notify owners more frequently that their property is heading for the lien sale, and must provide information on their eligibility for exemptions.
The bottom line is, the measure creates more ways for property owners to avoid having their debt sold to private investors and eventually lose their home.
The bill also bars the inclusion of vacant land from the sale if the city has determined that developing it is infeasible.
For years, the lien sale has been a puzzle for city leaders. It has long been criticized as disproportionately affecting low-income homeowners and communities of color.
But the city also needs to figure out how to collect outstanding debt. Since the last authorization for the sale expired, the city has seen a spike in delinquencies. As of this fiscal year, the city is owed $839 million. (Before the sales were halted, they yielded about $55 million a year for the city.)
The reform measure, which awaits the mayor’s signature, also creates a 10-person task force to consider better ways for the city to collect outstanding debt. Ahead of the vote, Council member Pierina Ana Sanchez, who chairs the Council’s Committee on Housing and Buildings, said the measure wasn’t perfect, but was good policy. She noted that the task force will work to enact more changes.
The approved budget adds $2 billion in funding for housing programs over the next two years, of which $1.3 billion will go to the Department of Housing Preservation and Development.
The budget also included $4.2 million to boost capital funding to the Department of City Planning and reverse the planned program to eliminate the gap, or PEG — the efficiency savings the mayor often promotes. The funding will help the agency advance neighborhood plans and rezonings.
What we’re thinking about: Will Gov. Kathy Hochul sign a bill that would force all those bidding on casino licenses downstate to submit their applications by Aug. 30? Send a note to kathryn@therealdeal.com.
A thing we’re learned: In the past few weeks, I have observed small birds crashing into hawks in the skies over the New Jersey Turnpike. I joked that the smaller birds had formed a gang to take out the raptors, but indeed that is essentially true. According to BirdNote, the phenomenon is called “mobbing,” and happens because smaller birds are trying to keep predators away from their nests.
Elsewhere in New York…
— A family from Georgia was killed in a plane crash on their return home from a baseball tournament in Cooperstown, New York, NBC New York reports. The single-engine plane crashed 90 miles southeast of Syracuse, killing five people, including two children.
— The MTA has begun its first week of G train shutdowns as it replaces 30 miles of tracks and completes key upgrades, Gothamist reports. Until July 5, no G trains will run between Court Street in Queens and Nassau Avenue in Brooklyn. Between July 5 and Aug. 12, the line will be shut down between Court Square and Bedford-Nostrand. And then from Aug. 12 to Sept. 3, no trains will run between Bedford-Nostrand and Church Avenue. According to Gothamist, the rollout of shuttle buses to replace the trains is off to a bumpy start.
— Barry Diller, head of media conglomerate IAC, may bid to take over Paramount, the New York Times reports. Diller signed nondisclosure agreements with Paramount’s controlling shareholder, which is a key step in such negotiations.
Closing Time
Residential: The priciest residential sale Monday was $6.9 million for a 3,129-square-foot condominium at 225 West 86th Street on the Upper West Side.
Commercial: The largest commercial sale of the day was $672 million for 132 commercial condo units at 9 Dekalb Avenue in Downtown Brooklyn. JDS ostensibly sold the Brooklyn Tower properties to Silverstein Properties, which holds the debt on the building.
New to the Market: The highest price for a residential property hitting the market was $11.9 million for a 4,631-square-foot condominium at 252 East 57th Street in Midtown East. Joe Peraino and Pat Slochower of Douglas Elliman have the listing.
Breaking Ground: The largest new building application filed was for a 232,600-square-foot, six-story production studio at 145 Wolcott Street in Red Hook. Richard Cook of Cookfox Architects filed the permit. — Matthew Elo