Andrew Friedman

Big Day for Affordable Housing

The New York City Council will be holding hearings today about competing proposals to reform New york City's 421-A property tax exemption program.

Everyone agrees the program, which provides tax breaks to developers, needs reform. Even developers who build large scale luxury housing projects, with no affordable housing set asides, currently get tax breaks as of right in most of the city.

Mayor Bloomberg has proposed the most modest set of reforms. Speaker Quinn has proposed her own set of reforms that demand a bit more from developers in exchange for the millions they receive in tax breaks. City Council Member Annabel Palma has proposed the most comprehensive set of reforms to the program. Housing advocates will be out in force at today's hearing to support Palma's proposal.

The disagreement centers on different analyses of what type of incentives developers need and/or deserve for building new housing, and how much the city should demand in return for offering these incentives.Palma's bill would not be limited only to certain neighborhoods. Instead, she demands on-site affordable housing set-asides everywhere in the City. The other proposals exclude certain neighborhoods, ostensibly to not burden development. Another debate centers on what percent of the housing should be required to be affordable, and how to define affordable. Housing advocates are calling for a 30% set-aside for households earning up to 50% of the area median income.

New York City has a massive affordable housing shortage. This shortage is likely to get worse as the city's population increases in coming years. 421-A reform is a welcome effort to create new affordable housing, and to demand something in return for hundreds of millions of dollars in tax breaks for developers.

Regardless of where we land, tenants, housing advocates and organizers, such as the Pratt Center for Community Development, ACORN and the Housing Here and Now Coalition deserve credit for pushing this issue to center stage.

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Posted at 8:10 AM, Dec 11, 2006 in Housing
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