Cuomo, State Legislature Agree To 421-a Replacement

Andrew Cuomo
New York Gov. Andrew Cuomo

Lawmakers in Albany have voted to bring back the 421-a tax abatement as part of a $163B budget deal passed late Sunday night.

Dubbed "Affordable New York," the new program closely resembles the one initially proposed by Gov. Andrew Cuomo in January. Major changes from the old program that expired in 2016 include an extension of the property tax break to 35 years, up from 25, and wage requirements for construction workers who work on qualifying projects.

Although the governor is expected to sign the legislation passed by the state Assembly Saturday night and the state Senate Sunday night, the bill contains a provision allowing Cuomo to unilaterally change the budget should he deem it necessary after the federal budget comes out later in the year.

The budget passed includes language authorizing the spending of $2.5B on 100,000 units of affordable housing and 6,000 units of supportive housing. Affordable New York is slated to last until 2022 and allows New York City to make changes to the implementation of the program.

While it is viewed by critics as a tax break for developers, there is no denying the need for more rental housing in the city. The Real Estate Board of New York lobbied the legislature closely for the revival of the tax abatement. REBNY president John Banks missed the Ingenious Deal awards dinner last week in New York because he was in Albany working with legislators to hash out a deal.

"It will result in the production of substantially more affordable rental housing that is critical to New York City's growth and future,” Banks said.

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