New York City Mayor Bill de Blasio has pledged to create or preserve 200,000 affordable units of housing in the next decade. Among the several proposals being considered, one idea is to amend a controversial real estate tax abatement available under section 421-a of the Rent Act of 2011. The abatement gives developers a property tax break, in decreasing amounts, over a 25-year period. In certain neighborhoods in the city, developers must set aside a percentage of units that are affordable. But in other parts of the city, there is no such requirement. The statutory authority for abatement expires this spring.
While there is no question that the tax abatement has added affordable units to the city, The New York Times on Feb. 2, 2015, reported the record-making sale of a penthouse which sold for $100.5 million. Because of a 421-a tax abatement, the real property tax bill was cut, initially, by 95 percent, or an estimated $360,000. According to the article, about 150,000 apartments got the 421-a tax exemption in fiscal year 2013, but only 12,748 were earmarked for low- and moderate-income tenants. (Charles V. Bagli, “In Program to Spur Affordable Housing, $100 Million Penthouse Gets 95% Tax Cut”)
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
