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Housing Developers Finally Agree to Prevailing Wages as Condition of Tax Breaks in NYC


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Last Thursday, New York Gov. Andrew Cuomo (D) announced a deal with developers and union construction officials that could bring back a program designed to create affordable housing for everyday New Yorkers. The program, called 421-a, expired in January.

After a failed effort to revive it in August, Gov. Cuomo brought the parties back to the bargaining table to hash out a deal that unless it required developers to pay prevailing wages to qualify for the tax breaks:

The agreement would set an average hourly wage of $60 for workers on developments in Manhattan south of 96thStreet that have 300 or more rental units, and $45 in areas along the Brooklyn and Queens waterfront. Developers could avoid the requirements if they enter into project labor agreements with unions. The tax break would last for 35 years.

[…] Gary LaBarbera, the president of the Building and Construction Trades Council of Greater New York, a union umbrella organization, issued a statement saying he “applauded” the governor for bringing the parties together “on an important public policy.”

The agreement still needs to be ratified by the State Legislature, and it may not be taken up until the new session in January, according to POLITICO:

“I don’t know if everything’s been worked out and I’m not sure why we would rush to do something in December that we could do a few weeks later in January and maybe get it right,” Assemblyman Jeff Dinowitz, a Democrat from the Bronx, said. “We always need to be part of the discussion and to weigh in. There could be an agreement, but ultimately the members of the Legislature need to ratify an agreement one way or another, whether that’s in December or January, I don’t know.”

Meanwhile, a memorandum of understanding (MOU) that details $2 billion in housing spending hangs in the balance. 421-a must be renewed before the MOU between the governor’s office and legislative leaders can be finalized.


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