The state's revision of the 421-a tax break, as I perhaps overemphasized yesterday, significantly adds to the exclusion area where developers won't be able to get a tax break for building market-rate housing without including affordable housing.
That's a significant advance, but it comes with a cost. The final version of the bill apparently came down to two men in a room, Brooklyn Assemblyman Vito Lopez (and surrogates) and Real Estate Board of New York (REBNY) executive Steven Spinola (ditto), each deputized by the two men who control their respective legislative bodies, Assembly Speaker Sheldon Silver and Senate Majority Leader Joseph Bruno.
And in those backroom negotiations emerged a nice plum for Forest City Ratner's Atlantic Yards project. (The lack of an obligation to build affordable housing in AY condo buildings adds to the developer's bottom line in multiple ways.)
Kept in the dark
Assemblyman Hakeem Jeffries, a sponsor of the bill (A 4408), wasn't even told (according to the Observer0 what was being inserted regarding his own district, which includes Prospect Heights.
When Lopez in March held an important hearing where he and others stressed that market-rate housing shouldn't be subsidized so much, REBNY offered polite testimony about why the city's less aggressive bill should be adopted by the state. There was no mention, of course, of Atlantic Yards.
The city's bill at least derived from a task force and much public discussion and debate. The state bill went to the backroom, under the radar. (Did the $3100 campaign contributions to Lopez last September from Michael Ratner, brother of FCR CEO Bruce Ratner, and his wife make a difference? They couldn't have hurt.)
ACORN, FCR change their tune
Both the advocacy group ACORN and developer Forest City Ratner have previously pledged equal treatment. At an affordable housing information session last July, Acorn's Bertha Lewis was quoted, as I reported:
“When we started to talk about it, there was a principle,” she said. Every building would be mixed affordable housing and market-rate housing. “If the elevator works for them, the elevator’s gotta work for you,” she said, to some healthy applause, probably the high point of the night for project proponents. It’s a worthy point; many other affordable housing programs are relegated to separate buildings or other neighborhoods.
And, in a May 2005 City Council hearing, FCR executive Jim Stuckey stated:
...it qualifies for 421A tax abatements for residential projects. So, if anyone else, anybody, not us, any developer, developed on this site as of right, they would be entitled to 25 year tax abatements to get phased in over time, the commercial incentive gets phased in in the beginning of the 15th year, and the residential gets phased in beginning in the 20th year.
Not any more.
WWSD
The Three Men in a Room are, of course, the Assembly Speaker, Senate Majority Leader, and Governor. The first two, apparently, are responsible for the 421-a legislation, while the third, self-proclaimed reformer Eliot Spitzer, must sign the result into law.
What will Spitzer do? Reflecting his ideals, the governor could take a stand against the process that led to such special pleading. Then again, Spitzer has long supported Atlantic Yards, so this might not be the time to expect him to act on principle.
That's a significant advance, but it comes with a cost. The final version of the bill apparently came down to two men in a room, Brooklyn Assemblyman Vito Lopez (and surrogates) and Real Estate Board of New York (REBNY) executive Steven Spinola (ditto), each deputized by the two men who control their respective legislative bodies, Assembly Speaker Sheldon Silver and Senate Majority Leader Joseph Bruno.
And in those backroom negotiations emerged a nice plum for Forest City Ratner's Atlantic Yards project. (The lack of an obligation to build affordable housing in AY condo buildings adds to the developer's bottom line in multiple ways.)
Kept in the dark
Assemblyman Hakeem Jeffries, a sponsor of the bill (A 4408), wasn't even told (according to the Observer0 what was being inserted regarding his own district, which includes Prospect Heights.
When Lopez in March held an important hearing where he and others stressed that market-rate housing shouldn't be subsidized so much, REBNY offered polite testimony about why the city's less aggressive bill should be adopted by the state. There was no mention, of course, of Atlantic Yards.
The city's bill at least derived from a task force and much public discussion and debate. The state bill went to the backroom, under the radar. (Did the $3100 campaign contributions to Lopez last September from Michael Ratner, brother of FCR CEO Bruce Ratner, and his wife make a difference? They couldn't have hurt.)
ACORN, FCR change their tune
Both the advocacy group ACORN and developer Forest City Ratner have previously pledged equal treatment. At an affordable housing information session last July, Acorn's Bertha Lewis was quoted, as I reported:
“When we started to talk about it, there was a principle,” she said. Every building would be mixed affordable housing and market-rate housing. “If the elevator works for them, the elevator’s gotta work for you,” she said, to some healthy applause, probably the high point of the night for project proponents. It’s a worthy point; many other affordable housing programs are relegated to separate buildings or other neighborhoods.
And, in a May 2005 City Council hearing, FCR executive Jim Stuckey stated:
...it qualifies for 421A tax abatements for residential projects. So, if anyone else, anybody, not us, any developer, developed on this site as of right, they would be entitled to 25 year tax abatements to get phased in over time, the commercial incentive gets phased in in the beginning of the 15th year, and the residential gets phased in beginning in the 20th year.
Not any more.
WWSD
The Three Men in a Room are, of course, the Assembly Speaker, Senate Majority Leader, and Governor. The first two, apparently, are responsible for the 421-a legislation, while the third, self-proclaimed reformer Eliot Spitzer, must sign the result into law.
What will Spitzer do? Reflecting his ideals, the governor could take a stand against the process that led to such special pleading. Then again, Spitzer has long supported Atlantic Yards, so this might not be the time to expect him to act on principle.
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