Heard Around Town: No 421-a in Senate, Assembly budget bills
When the real estate industry and construction union leaders failed to reach a deal to extend the 421-a tax abatement program earlier this year, some observers figured it would get renewed in the state budget.
But Gov. Andrew Cuomo didn’t address the controversial program, which offered incentives to developers who include affordable units in new buildings, in his executive budget proposal in January.
And now that the state Senate and the Assembly have published their own budget proposals in recent days, neither house called for renewing 421-a or creating a program to replace it – casting doubt on whether any deal will be reached before the April 1 state budget deadline.
Mike Whyland, a spokesman for the Assembly Democrats, confirmed that 421-a was not addressed in the lower house’s budget. “As the Speaker has said, developers and labor still have an opportunity to work out a deal,” Whyland said in a statement, “and if not we recognize the need to have some type of program in place to encourage affordable housing.”
A Senate Republican spokesperson said that the conference’s position hasn’t changed since the negotiating deadline passed early this year. “We still believe it’s imperative that a program is in place that fixes the City’s inequitable taxing structure that is preventing the private construction of affordable rental housing,” said Kelly Cummings, a spokeswoman for the Senate GOP, in January. “This is crucial in a city as expensive to live in as New York.”
A Cuomo spokeswoman confirmed that there are no ongoing discussions regarding the creation of a housing program that would replace 421-a.
Supporters of the program say it had played a critical role in spurring affordable housing in New York City. Critics blasted luxury developers who took advantage of it to reduce their tax burden.
In an unusual move, the governor and legislative leaders last year delegated to the Real Estate Board of New York and constructions unions the responsibility of hashing out an agreement involving prevailing wages for workers on 421-a projects, but the effort fell through. Neither REBNY nor its negotiating partner, the Building and Construction Trades Council of Greater New York, responded to requests for comment.
At least one observer said that the governor and legislative leaders could still work out some kind of compromise. Hank Sheinkopf, a longtime political consultant, said he’s not surprised at the lack of progress, but that there’s still time to make a deal – even if it’s later on in the session after the budget deadline.
“It’s not resolved so far from last session,” he said. “If there’s a new resolution, it will be in discussion with the governor and the two legislative leaders, and that really doesn’t happen until the budget moves along a little bit more.”