Thousands of NYC tenants and advocates marched over the Brooklyn Bridge last summer to
voice their opposition for 421-a, which they argue doesn't require an adequate
amount of truly affordable housing. The abatement was nevertheless renewed
(with slightly higher affordability requirements of 25-30%) but conditionally—real estate executives and union
officials were tasked to come to an agreement by January 15th, 2016 as to
whether construction workers on 421-a build projects would be guaranteed a
union-level wage. They didn't.
The NY Times reports that a
one-page memo was sent to Real Estate Board of New York
members on Tuesday, outlining the new proposal.
Under this new iteration of 421-a, developers would not
be required to pay union wages on their projects. However, the state would
instate two separate minimum wages for certain new development projects with at
least 300 units: $65 per hour plus benefits for Manhattan projects below 96th Street,
and $50 per hour plus benefits for projects on the Brooklyn or Queens
waterfront. For comparison, the developer trade association and lobbying group New York State Association for Affordable Housing [NYSAFAH]
has said that non-union carpenters make about $31 per hour. (Real Affordability for All, an affordable housing
coalition that includes many union locals, issued a controversial report
concluding that wage-theft is rampant on non-union construction sites.)
In Brooklyn and Queens, $15 per hour, or 30% of the rate,
would be reimbursed by the state. In exchange, any 421-a recipients would be
required to build 25-30% of apartments below market rate.
It's still not clear how the amended version of 421-a
would be funded. Cuomo spokeswoman Dani Lever did not confirm the proposal
Thursday but stated that, "We continue to work to reach an agreement on a
successor program to 421-a."
"We are working on and considering new and various
proposals with all stakeholders but at this point there is no agreement on
anything," she added.
Mayor de Blasio has long heralded 421-a as an important
component of his affordable housing plan, which aims to construct
80,000 new units of affordable housing over the next ten years. When union reps
started pushing for a prevailing wage on affordable housing construction sites,
his administration warned that raising worker wages would deter developers from
the program, jeopardizing an estimated
17,000 below-market rate apartments.
But housing advocates counter that the program lines the
pockets of developers while failing to ensure adequate affordable housing for
New Yorkers. 421-a sets its affordability requirements as a percentage of the
median income across the metropolitan area, which is significantly higher than
the median income in many of New York City neighborhoods.
Vicki Been, head of the city's Housing and Preservation
Development (HPD), emphasized last month that 25% of affordable
units produced under the plan to date, 12,970 of the total, are set aside for
New Yorkers who make less than 50% of that median income, or $40,800 for a
family of three. For context, a full third of the city's households have an
annual income of less than $35,000.
Gary La Barbera, president of the Building and
Construction Trades Council, did not immediately respond to a request for
comment, but told the NY Times that he endorsed the proposal. "We feel
this is a viable resolution of the issue," he said. "It's now up to
REBNY to agree, or not. The ball's clearly in their court."
REBNY President John Banks did not issue a formal
endorsement on Thursday, but stated that 421-a is a necessary incentive for
developers to construct affordable housing in New York City. "Such
development simply is not possible without a tax abatement program like
421-a," he said. "We remain committed to engaging in a dialogue with
stakeholders to enact a plan to create affordable rental housing."
A spokesman for the mayor's office withheld comment
pending a press conference later this morning where de Blasio is expected to
address this news.
Kerri White, a spokeswoman for the affordable housing
nonprofit the Urban Homesteading Assistance Board, told us
during the January stalemate between unions and developers over 421-a that
tenants were fed up with late-in-the-game squabbling over a tax abatement that
is barely enforced as it is. She cited a recent investigation into Two Trees Management's property at
125 Court Street, where tenants were overcharged an estimated total
of $368,000, despite 421-a tax abatements.
"This is a broken program and it's gone past the
point of reform," she said. "It's always frustrating to see all of
this political energy going towards making these subsidies work."
"This out-of-session energy around 421-a is
unacceptable when they refuse to consider strengthening the rent laws," she added on
Thursday. "Certain people push these arguments that you have to chose
between good jobs and having an affordable place to live. We need to live in a
city that offers both."
Source: Gothamist.com
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