Senator Dilan Co-sponsors Comprehensive 421-a Legislation
Senator Dilan has co-sponsored a bill that Senator Liz Krueger (D-Manhattan) introduced that aims to curb the rampant tax breaks given to developers who have no intention of providing the affordable housing units within their buildings.
“The 421-a tax abatement program was originally established to help spur development in New York City when it was struggling financially in the 1970s. However, now we are experiencing a housing boom and we need to make sure that new construction includes affordable units for the hard working middle class residents of our city,” Senator Dilan said.
Under this legislation, any new development that is eligible to receive the 421-a tax abatement must make a minimum of 30% of the units affordable to low- and moderate-income families. Low- and moderate-income families are defined as having incomes that do not exceed more than fifty percent of the area median income – adjusted for family size. In addition, 50% of the affordable units must be made available to existing residents living within the community board of the new building. All affordable units must be created on-site as part of the market rate development to help create mixed income communities.
“This is an important step toward not only creating new affordable housing options for residents, but also to preserve the integrity of the communities in which these new buildings are constructed. For too long developers have been receiving the tax benefits and then building the affordable units off-site. I am pleased this legislation holds developers accountable to the communities in which they are constructing these buildings,” Senator Dilan said.
Also, the bill would require that owners of the building who receive the 421-a tax breaks must pay their building service workers the prevailing wage. If the owner fails to do so during the time they are receiving the tax benefit, the benefit will be revoked for the time they did not obey the law.
One final and important provision of the bill is that it creates an affordable housing fund of at least $400 million. According to the sponsor’s memo on the bill, New York City would receive this revenue as a result of the proposed changes to the existing property tax exemptions. All this new revenue will be placed into a dedicated New York City trust fund to be used only for the purpose of funding affordable housing programs. The programs will target the fifteen poorest community districts in New York City. This trust fund will act as a supplement to the existing affordable housing programs in the city rather than replace any existing programs.
“I am pleased to support this legislation and look forward to its full implementation here in New York. We have an opportunity to update our system to create much needed affordable housing all across the city. I will be continuing my efforts to get this legislation passed this year,” Senator Dilan stated.