June 4, 2015
By Joe Maniscalco
New York, NY – When pressed, the de Blasio administration says reforming NYC’s 421–a tax abatement program with a prevailing wage component for construction workers, would result in far fewer affordable housing units being built over the next decade. But opponents scrutinizing Hizzoner’s reforms closely are finding the tweaks may not actually offer much more “affordability" than what's already out there.
Skyrocketing rents throughout the city have been soaring out in front of income levels for a long while, to the point now where over half of New York City renters are forced to shell out more than one-third of their dough on housing costs.
The administration’s own projections, however, don’t seem to be nearly enough to alleviate all the pain.
If changes to the 421-a tax abatement program are adopted, the de Blasio administration believes that over the next decade, the city could see the creation of 9,500 apartments renting between $800 and $1200.
That may sound encouraging, and every little bit helps, of course – but most of the 25,500 new affordable housing units forecast overall, are expected to rent for around $2,500 per month.
At Monday’s Housing and Buildings Committee hearing, Manhattan Borough President Gale Brewer offered testimony calling for housing that is actually affordable to neighborhood residents.
“We need to ensure 421-a subsidized apartments are affordable to local residents,” Brewer said. “This may require offering rental units at levels well below the program’s current requirement of 60-percent to 120-percent of AMI [Average Median Income].”
The 421-a tax abatement reforms that the de Blasio administration advocates offers developers three affordable housing options that use AMI levels ranging from 40-percent, all the way up to 130-percent.
That reality prompted Councilmember Steve Levin [D-33rd District] to say, “I don’t consider 130-percent AMI affordable housing — it’s a different thing. That’s for somebody like me with my salary.”
Tom Waters, a housing policy analyst with the Community Service Society, testified that New Yorkers could actually end up getting fewer $1,500 rentals then they are getting now.
“But where rents are still relatively high, developers will also choose the 30 percent affordable option,” Waters testified. “This will result in a significant number of apartments at the $2,500 level.”
At the same hearing, Housing Preservation and Development Commissioner Vickie Been said that it is too difficult to predict how development will actually play out over the next decade, but that reforming the 421-a tax abatement program — without a prevailing wage mandate for construction workers — would, nevertheless, result in a majority of new affordable housing units based on 60-percent AMI or lower.
Assembly Walter Mosley [D-57th District] gave some indication of the mood of Democrats in Albany, dismissing the premise that mandating a prevailing wage for construction workers would result in fewer affordable housing units built, while also questioning the administration’s overall affordability model.
“Government needs to set better terms,” the Brooklyn assemblyman said.
Anthony Thomas, political director, NYC Central Labor Council, meanwhile, referred to university studies showing no statistical cost difference between union and nonunion construction.
“We believe labor standards and pathways to apprenticeships are the best way to raise the floor on wages and workplace standards, and one of the best policy tools for combatting wealth inequality,” he testified.
