Thursday, February 11, 2016

Lapsed 421-a controversy resurfaces with unprompted email



On Monday afternoon, the lead labor negotiator for a now-expired development tax break known as 421-a put out an unusually timed statement.

"After exhaustive, good-faith conversations had over the last seven months, it is clear that 421-a as we know it is dead and will not be revived," Gary LaBarbera, president of the Building and Construction Trades Council of Greater New York, said in an email. "After careful consideration, we believe it is very clear that absent a prevailing wage requirement, the 421-a tax abatement program should not be renewed under any circumstances. We need a new, comprehensive approach that builds needed affordable housing citywide, while also offering construction workers good middle-class wages and benefits."


LaBarbera was tasked by Gov. Andrew Cuomo with negotiating a deal on 421-a, a lucrative property tax exemption, with the Real Estate Board of New York when the program was up for renewal last year. The talks fell apart last month and the program expired.

It was not clear what prompted the email on Monday, and the statement seemed to echo LaBarbera's comments when the tax exemption expired in mid-January.

The statement did not appear to have been sent to LaBarbera's usual press list. Instead, it was sent to members of the Albany press corps, but not to city housing reporters who typically receive LaBarbera's emails.

A spokesman for Cuomo did not answer questions about whether the email was sent to a list maintained by the governor.

Asked what prompted the email, a spokesman for LaBarbera simply said, "We issued the statement so Gary's position on 421-a would be very clear as we move forward."

Several sources close to the previous 421-a negotiations, who would only speak on background, said LaBarbera may have been pushing back against the possibility that State Senate Republicans would craft 421-a legislation that excludes a prevailing wage requirement — an idea that has been floated in recent weeks.

The statement also came shortly before the New York City Council prepares for a contentious hearing on Mayor Bill de Blasio's zoning proposal.

In response to LaBarbera's statement, Jolie Milstein, president of the New York State Association for Affordable Housing, sent out an email criticizing his position.

"Gary LaBarbera's hard-line position is irresponsible and reveals his disregard for addressing New York City's affordable housing crisis. Construction union leaders need to understand that low- and middle-income New Yorkers need new affordable housing, not political posturing," she wrote.

REBNY president John Banks said in his own statement, "The need to produce more multi-family rental housing, particularly at below-market or affordable rents, is one of the most pressing issues facing New York City. Imposing a construction prevailing wage requirement on the new 421-a program will simply result in much less affordable housing so that certain segments of the construction industry can be paid well above middle-class wages."

Developers believe that requiring a prevailing wage on 421-a development would make the projects financially untenable because the rates are far higher than non-union wages and include medical benefits and overtime pay.

Cuomo, asked about the issue during a press conference, said the former 421-a was "very controversial, complicated" and added, "I believe [LaBarbera] when he says 421-a should not be revived even if you could bring something back."

Meanwhile a spokesman for the State Assembly said the body received LaBarbera's statement and the position of the conference on 421-a has not changed. In September, Assembly Speaker Carl Heastie said he supports including a prevailing wage requirement in 421-a.

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