June 12, 2015
By Marc Bussanich
New York, NY—On Thursday the New York AFL-CIO’s executive board passed unanimously a resolution supporting prevailing wage for all workers, whether construction or building services, on 421-a projects. Meanwhile the city’s editorial boards are calling for Governor Andrew Cuomo to move fast before the legislative session ends next week to reform the 421-a tax abatement program for developers.
Mario Cilento, New York State AFL-CIO President, said in a statement that the resolution shows the state’s entire labor movement is unified to ensure that all workers are paid prevailing wages building and maintaining the city’s affordable housing stock.
“Today’s vote by our Executive Council sends a powerful message. The labor movement is speaking with one very clear voice that there must be a return on the taxpayer’s investment, and in this case that return for giving developers more than $1 billion a year in tax breaks needs to be the creation of good jobs,” said Cilento.
The federation is critical of the 421-a tax abatement program for giving too many benefits to real estate developers and not enough to the city’s private sector workforce.
“The 421-a program is costing taxpayers billions and if allowed to continue as is, will drive down wages in the construction industry and lower the standard of living for all workers. Including prevailing wage on 421-a projects benefits the city and the state by providing workingmen and women the ability to support local businesses. That in turn will generate tax revenue to support vital and quality public services that all New Yorkers expect and deserve,” the federation said in a statement.
Meanwhile, today’s New York Times editorial board praised Mayor Bill de Blasio’s proposal to reform the 421-a program such as eliminating the tax break for luxury condominiums, but also criticizes his proposal for giving developers of other apartments longer tax breaks from 25 years to 35 years to build affordable housing.
And Tuesday’s Observer’s editorial board took a hard stand against “the rhetoric of prevailing wage,” an apparent dig at organized labor.
“We’ve also heard rhetoric—amplified by what seems like a bottomless budget for TV commercials—linking 421-a to a “prevailing wage. This is a pure political maneuver that by definition makes creating affordable housing harder by increasing costs for developers—most of which pay a strong wage already.”
But the state labor federation’s Cilento rebuked that claim by saying that elected officials have a golden opportunity to reform the program to reduce income inequality.
“We are united in siding with taxpayers, those in need of affordable housing, and hard-working men and women in fighting for good jobs. Our elected leaders have an opportunity to make history by taking meaningful action to address income inequality and help lift the middle class,” Cilento said.