NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9293
SPONSOR: Lopez V (MS) TITLE OF BILL:
An act to amend the real property tax law, in relation to making techni-
cal amendments regarding eligibility limitations on exemptions of new
multiple dwellings
SUMMARY OF PROVISIONS:
This bill makes numerous technical changes in 6141A/A4408A.
JUSTIFICATION:
Section 421-a of the Real Property Tax Law has provided tax benefits for
construction of new residential buildings in the City of New York since
1971. Section 421-a benefits are available for up to 25 years depending
upon the location of the multiple dwelling and the inclusion of afforda-
ble housing units. The law provides a period of full exemption followed
by a phase-out to full taxation. The 421-a program has been primarily
responsible for encouraging the construction of new housing in New York
City since 1971. Since 1985, the 421-a program has also been responsible
for generating affordable units both in Manhattan and in the outer
boroughs. The continuing shortage of affordable housing in the City of
New York necessitates the extension of this essential tax exemption
program that serves as an incentive for the development of new housing.
The proposed legislation would ensure that the 421-a program continued
to fulfill this mission by extending the program.
On December 28, 2006, Mayor Bloomberg signed New York City Council Local
Law No. 58 of 2006. This legislation, which contains extensive reforms
to the 421-a tax incentive program, will become effective one year later
to coincide with the extension of the state authority for the program
proposed in this bill if the legislature chooses to extend the program
beyond December 31, 2007.
FISCAL IMPACT:
None to the state.
EFFECTIVE DATE:
Immediate.
STATE OF NEW YORK
________________________________________________________________________
9293
2007-2008 Regular Sessions
IN ASSEMBLY
June 19, 2007
___________
Introduced by M. of A. V. LOPEZ -- Multi-Sponsored by -- M. of A. BENJA-
MIN, BOYLAND, CAMARA, ESPAILLAT, FARRELL, LAFAYETTE, MILLMAN, NOLAN,
ORTIZ, PERALTA, POWELL, TITONE, TOWNS, WRIGHT -- read once and
referred to the Committee on Ways and Means
AN ACT to amend the real property tax law, in relation to making techni-
cal amendments regarding eligibility limitations on exemptions of new
multiple dwellings
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subparagraph (i) of paragraph (a) of subdivision 7 of
2 section 421-a of the real property tax law, as amended by a chapter of
3 the laws of 2007 amending the real property tax law relating to
4 exemption of new multiple dwellings from local taxation, as proposed in
5 legislative bill number A.4408-A, is amended to read as follows:
6 (i) "affordable units" shall mean units which meet [either of the two]
7 the affordability requirements set forth in paragraph [(b)] (c) of this
8 subdivision.
9 § 2. Paragraph (c) of subdivision 7 of section 421-a of the real prop-
10 erty tax law, as amended by a chapter of the laws of 2007 amending the
11 real property tax law relating to exemption of new multiple dwellings
12 from local taxation, as proposed in legislative bill number A.4408-A, is
13 amended to read as follows:
14 (c)(i) Not less than twenty percent of the units in the multiple
15 dwelling must, upon the initial rental of the units and upon all subse-
16 quent rentals of the units after a vacancy, be affordable to and occu-
17 pied or available for occupancy by individuals or families whose incomes
18 at the time of initial occupancy do not exceed sixty percent of the area
19 median incomes adjusted for family size or (ii) if the construction of
20 such building is carried out with substantial assistance of grants,
21 loans or subsidies from any federal, state or local agency or instrumen-
22 tality and such assistance is provided pursuant to a program for the
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD13958-02-7
A. 9293 2
1 development of affordable housing [which the local housing agency finds
2 that such program provides opportunities for affordable housing compara-
3 ble to the affordable requirements set forth in subparagraph (i) of this
4 paragraph], not less than twenty percent of the units in the multiple
5 dwelling must, upon the initial rental of the units and upon all subse-
6 quent rentals of the units after a vacancy, be affordable to and occu-
7 pied or available for occupancy by individuals or families whose incomes
8 at the time of initial occupancy do not exceed eighty percent of the
9 area median incomes adjusted for family size. No less than fifty
10 percent of all units which qualify for benefits pursuant to this section
11 in any year shall meet the requirements of subparagraph (i) of this
12 paragraph.
13 § 3. Subparagraphs (i) and (ii) of paragraph (d) of subdivision 7 of
14 section 421-a of the real property tax law, as amended by a chapter of
15 the laws of 2007 amending the real property tax law relating to
16 exemption of new multiple dwellings from local taxation, as proposed in
17 legislative bill number A.4408-A, are amended to read as follows:
18 (i) all affordable units must have a comparable number of bedrooms as
19 market rate units and a unit mix proportional to the market rate units,
20 or at least fifty percent of the affordable units must have two or more
21 bedrooms and no more than fifty percent of the remaining units can be
22 smaller than one bedroom or in addition to the requirements of paragraph
23 (c) of this subdivision, the floor area of affordable units is no less
24 than twenty percent of the total floor area of all dwelling units; and
25 (ii) residents of the community board where the multiple dwelling
26 which receives the benefits provided in this section is located shall,
27 upon initial occupancy, have priority for the purchase or rental of
28 fifty percent of the affordable units.
29 § 4. Paragraphs (d) and (e) of subdivision 8 of section 421-a of the
30 real property tax law, as amended by a chapter of the laws of 2007
31 amending the real property tax law relating to exemption of new multiple
32 dwellings from local taxation, as proposed in legislative bill number
33 A.4408-A, are amended to read as follows:
34 (d) The local [hiousing] housing agency shall prescribe appropriate
35 sanctions for failure to comply with the provisions of this [subdivison]
36 subdivision.
37 (e) [For] Solely for purposes of paragraph (b) of this subdivision,
38 construction shall be deemed to have commenced when excavation or alter-
39 ation has begun in good faith on the basis of approved construction
40 plans.
41 § 5. Paragraph (c) of subdivision 9 of section 421-a of the real prop-
42 erty tax law, as amended by a chapter of the laws of 2007 amen ding the
43 real property tax law relating to exemption of new multiple dwellings
44 from local taxation, as proposed in legislative bill number A.4408-A, is
45 amended to read as follows:
46 (c) The portion of the assessed valuation of any residential tax lot
47 exempted from real property taxation in any year pursuant to this
48 section shall not exceed the exemption cap on or after the first taxable
49 status date after the building on or containing such tax lot receives
50 its certificate of occupancy, unless, it is located in a geographic
51 [exlusion] exclusion area as defined in subdivision seven of this
52 section and complies with the provisions of such subdivision. The
53 portion of the assessed valuation of all non-residential tax lots in the
54 building on or containing such non-residential tax lots exempted from
55 real property taxation in any year pursuant to this section shall not
56 exceed a cumulative total equal to the annual limit on or after the
A. 9293 3
1 first taxable status date after the building on or containing such non-
2 residential tax lots receives its certificate of occupancy. A dwelling
3 [unkit] unit that is located in two or more tax lots shall be ineligible
4 to [recieve] receive any benefits under this section.
5 § 6. Subdivisions 13, 14, and 15 of section 421-a of the real property
6 tax law, as amended by a chapter of the laws of 2007 amending the real
7 property tax law relating to exemption of new multiple dwellings from
8 local taxation, as proposed in legislative bill number A.4408-A, are
9 amended to read as follows:
10 13. A multi-phase project that includes at least [2,500] twenty-five
11 hundred dwelling units and (i) is being implemented pursuant to a Gener-
12 al Project Plan adopted by the New York State Urban Development Corpo-
13 ration and approved by Public Authorities Control Board or is otherwise
14 set forth in agreements with the New York State Urban Development Corpo-
15 ration and (ii) includes a development over a number of city blocks,
16 shall be eligible for benefits pursuant to this section notwithstanding
17 paragraph [(e)] (f) of subdivision [7] seven of this section if in the
18 aggregate twenty percent of the units in such development are affordable
19 to and occupied or available for occupancy by individuals or families
20 the average of whose incomes at the time of initial occupancy do not
21 exceed [60] seventy percent of the area median incomes adjusted for
22 family size and the rent for such units does not exceed thirty percent
23 of eighty percent of the area median incomes adjusted for family size.
24 14. The provisions of subdivisions seven and nine of this section
25 shall not apply to (1) multiple dwellings which commence construction
26 prior to July first, two thousand eight; or (2) where commencement of
27 construction is delayed as a result of litigation relating to a contract
28 for the purchase of real property entered into prior to December twen-
29 ty-eight, two thousand six and in which a judgment was entered prior to
30 the effective date of this subdivision provided that construction
31 commences within a reasonable time after final resolution of the liti-
32 gation; or (3) where benefits pursuant to this section are sought for a
33 building located on a site requiring environmental remediation
34 construction and a certificate of completion pursuant to section 27-1419
35 of the environmental conservation law has been issued prior to July
36 first, two thousand eight, provided that construction is completed with-
37 out undue delay; or (4) a project which (i) on or before December thir-
38 ty-first, two thousand six, such project receives special permits pursu-
39 ant to the New York city zoning resolution with respect to all buildings
40 to be constructed on the development site, and (ii) on December thirty-
41 first, two thousand six, a portion of such development site was owned by
42 the city of New York and contained a New York power authority temporary
43 generating facility, and (iii) such project commenced construction
44 before the later of three years from the effective date of this subdivi-
45 sion or eighteen months from the removal of all such temporary generat-
46 ing facilities.
47 15. Paragraphs 2 through 4 of subdivision [a] (a) of section 11-245 of
48 the administrative code of the city of New York, subdivisions [b-1 and
49 b-2] (b-1) and (b-2) of section 11-245 of the administrative code of the
50 city of New York and Part l of subchapter 2 of chapter 2 of title 11 of
51 the administrative code of the city of New York, as added by local law
52 No. 58 of the City of New York for the year 2006 shall not apply to (1)
53 multiple dwellings which commence construction prior to July [1, 2008]
54 first, two thousand eight; or (2) where commencement of construction is
55 delayed as a result of litigation relating to a contract for the
56 purchase of real property entered into prior to December [28, 2006]
A. 9293 4
1 twenty-eighth, two thousand six and in which a judgment was entered
2 prior to the effective date of this subdivision provided that
3 construction commences within a reasonable time after final resolution
4 of the litigation; or (3) where benefits pursuant to this section are
5 sought for a building located on a site requiring environmental remedi-
6 ation construction and a certificate of completion pursuant to section
7 27-1419 of the environmental conservation law has been issued prior to
8 July 1, 2008, provided that construction is completed without undue
9 delay; or (4) a project which (i) on or before December thirty-first,
10 two thousand six, such project receives special permits pursuant to the
11 New York city zoning resolution with respect to all buildings to be
12 constructed on the development site, and (ii) on December thirty-first,
13 two thousand six, a portion of such development site was owned by the
14 city of New York and contained a New York power authority temporary
15 generating facility, and (iii) such project commenced construction
16 before the later of three years from the effective date of this subdivi-
17 sion or eighteen months from the removal of all such temporary generat-
18 ing facilities.
19 § 7. Paragraph (i) of subdivision 2 of section 421-a of the real prop-
20 erty tax law, as amended by a chapter of the laws of 2007 amen ding the
21 real property tax law relating to exemption of new multiple dwellings
22 from local taxation, as proposed in legislative bill number A.4408-A, is
23 amended to read as follows:
24 (i) Authority of city to enact local law. Except as otherwise speci-
25 fied in this section, a city to which this section is applicable may
26 enact a local law to restrict, limit or condition the eligibility, scope
27 or amount of the benefits under this section in any manner provided that
28 such local law may not grant benefits beyond those provided in this
29 section and provided further that in the city of New York such local law
30 shall not take effect sooner than one year after it is enacted.
31 Notwithstanding the foregoing, the provisions of any local law shall not
32 [be inconsistent with subdivisions seven through fifteen of this
33 section] alter the effect of subdivisions twelve, thirteen, fourteen,
34 and fifteen of this section as they apply on the effective date of such
35 subdivisions, notwithstanding any subsequent amendments to the
36 provisions of law referred to in such subdivisions.
37 § 8. This act shall take effect on the same date and in the same
38 manner as a chapter of the laws of 2007 amending the real property tax
39 law relating to exemption of new multiple dwellings from local taxation,
40 as proposed in legislative bill number A.4408-A, takes effect.
