"The last bill before me is Introductory Number 530, sponsored at the request of the Administration by Council Members Provenzano, Avella, Jennings, Quinn, Katz, Palma, Weprin, Martinez and Public Advocate Betsy Gotbaum. This bill amends the exclusion area for 421A tax benefits in Manhattan in connection with the recent Hudson Yards rezoning.
"Since being enacted in 1971, the 421A Partial Tax Exemption Program has played an important role in stimulating overall housing production throughout New York City. By providing a limited period of exemption from tax liability, the 421A program has induced the creation of over 145,000 apartments throughout the City.
"However, as real estate values rose in the 1980s and tax incentives were no longer necessary to promote residential development in Manhattan, the City Council established the Manhattan Exclusion Zone to limit 421A benefits for projects within certain geographic boundaries. To achieve tax benefits in the Exclusion Zone, developers must either develop at least 20% of the new units onsite as affordable for a 20-year tax exemption, or build affordable housing off-site through the Affordable Housing Negotiable Certificate Program and realize a 10-year tax exemption.
"Introductory Number 530 extends the Manhattan Exclusion Zone to those areas of Manhattan's West Side covered by the historic Hudson Yards rezoning. The original boundaries did not extend to the Hudson Yards because the area was not zoned for residential development, making the 421A program inapplicable. In combination with the new zoning designations, this legislation will substantially increase the City's affordable housing stock by requiring the creation of affordable housing units in return for receiving 421A tax exemptions for residential development in the Hudson Yards area. This action will stimulate the creation of almost 4,000 affordable apartments.
"This legislation, in combination with the other components of the Hudson Yards rezoning, is the realization of years of planning and hard work. For decades people have tried to develop a plan for the far west side of Manhattan and for decades those people have failed. I am immensely proud that the City has finally put a plan in place to develop this important part of our city. In doing so, we will extend Manhattan's economic juggernaut into the Hudson Yards area, create almost 300,000 construction jobs and 300,000 permanent jobs, and revitalize a long-neglected part of our City.
"I would like to thank the City Council, City Planning Chair Amanda Burden, HPD Commissioner Shaun Donovan, and their staffs for their leadership and work on this issue.
"I would also like to thank the broad coalition of groups and individuals that backed the Hudson Yards plan, especially organized labor led by the building trades. In particular, I would like to recognize the efforts of Ed Malloy, president of the Building and Construction Trades Council, Lou Coletti, president of the Building Trades Employers Association, and David Lennon, the president of Local 802 of the American Federation of Musicians, who led a Hudson Yards Affordable Housing Task Force that was instrumental in helping the plan pass with such a strong affordable housing component."