Report on NYC Council Legislation to Require the Auditing of Buildings for Compliance with the Affordability Requirements of the 421-a Tax Exemption Program

SUMMARY

The Housing & Urban Development Committee (Daniel Weisz, Co-Chair), Land Use Planning & Zoning Committee (David Mark Karnovsky, Chair), and Real Property Law Committee (Lesley Horton Campbell, Chair) issued a joint-committee report on two New York City Council bills that would implement new auditing procedures of buildings that receive a 421-a tax exemption. While the Committees strongly support greater oversight of projects receiving a 421-a tax exemption, the pending legislation, as presently written, raise several concerns. The new auditing requirements will significantly increase the workload of the auditing agencies; however, the bills do not allocate additional resources to these agencies. The Committees recommend additional resources be allocated to minimize administrative delays. The bills presently mandate one remedy, rather than adopting the more flexible and effective enforcement scheme specified in Department of Housing Preservation and Development rules. This may negatively impact the ongoing multi-agency enforcement effort that has been very effective. The Committees recommend that the City Council consult with these agencies and adopt the current enforcement regulatory structure to penalize non-compliant buildings. Lastly, given that the State legislature is reviewing a revised 421-a program that includes an auditing requirement, these two bills should only apply to buildings that currently receive or in the process of applying for the tax exemption. 

BILL INFORMATION

Intro. 1359-2016
Intro. 1366-2016
Local Laws to amend the Administrative Code of the City of New York, in relation to auditing buildings for compliance with the affordability requirements of the 421-a tax exemption program

OUTCOME

Signed by the Mayor, 2017/193 and 2017/194 – October 16, 2017