Task Force Set to Overhaul Program for Development Tax Breaks

New York, NY —

A Mayoral task force set up to overhaul a program that gives tax breaks to developers will meet for the final time today. The so called 421A program started in the 70’s to spur development and hasn’t been updated since 1987.

The changes to the program are likely to be more modest than some had hoped for including a group of elected officials and housing groups who believe that in a booming housing market, tax incentives should only be handed out in exchange for affordable housing. Right now that only happens in Manhattan between 14th and 96th streets.

This so called exclusion zone is likely to be expanded to Lower Manhattan, parts of Harlem and Brooklyn Heights. For market rate developers who build in the exclusion zone, the panel has also been debating whether to continue to allow them to construct their affordable housing quota offsite.

The Independent Budget office estimates the 421A program results in the loss of $400 million in property taxes each year.