Critics rip Cuomo plan that combines tax and wage subsidies

ALBANY — A proposal to revive a lucrative affordable housing tax credit for developers by providing government wage subsidies for the workers they hire is being blasted by business groups, non-profit providers and economic experts.

In order to jump-start talks involving the expired 421-a tax credit, the Cuomo administration has suggested the possibility of creating a two-tiered minimum wage for housing projects, with the state reimbursing part of the costs.

E.J. McMahon, president of the Empire Center for Public Policy, said such a plan would be a double-whammy for taxpayers who would be on the hook for funding the tax credit and helping cover higher wages for workers.

“It’s a real headscratcher having a tax subsidy and a wage subsidy,” McMahon said. “I’m struggling to think of anything like it in the country.”

De Blasio supports affordable housing tax break for developers

Mike Durant, who represents 11,000 small businesses in New York as state director of the National Federation of Independent Business, called the proposal “crazy,” particularly after Cuomo and the Legislature this year passed a law to phase in a $15 minimum wage in some parts of the state without offering businesses any assistance.

“This is probably something the labor unions want and I think we’re finding that when the labor unions say ‘jump’, everyone in Albany says ‘how high,” Durant said.

Non-profit groups are also unhappy since their calls for higher state reimbursements were flatly rejected when the state raised the minimum wage.

Sources close to Cuomo dismissed the criticisms as premature since no agreement is in place.

Cuomo vows to reject tax credit program without fair labor

E.J. McMahon of the Empire Center for Public Policy said giving a tax subsidy and wage subsidy is a "real headscratcher."

E.J. McMahon of the Empire Center for Public Policy said giving a tax subsidy and wage subsidy is a “real headscratcher.”

(Mike Groll/AP)

They insist that the 421-a tax credit as it was before it expired in January is dead and that the governor is insistent that any deal include not only higher wages for workers, but also more affordable housing units than have been on the table previously under a deal that was cut unilaterally between Mayor de Blasio and the Real Estate Board of New York that was rejected by the governor, Legislature, and unions.

Cuomo might also be pushing to keep the units below market rate for a longer period of time, they say.

The critics, the sources said, are only talking about one piece, paying the union wage. They aren’t looking at the second condition, which is more affordability.”

The developers have complained that paying union-like wages for affordable housing projects is not economically feasible.

EXCLUSIVE: Builders, union trade jabs over jobs lost in NY

But a Cuomo source said the builders might have to accept smaller profits if they are to receive lucrative affordable housing tax credits from the state.

The source said the Real Estate Board of New York and the trade unions have become more flexible in recent talks because the pipeline of affordable housing projects is drying up, including one pushed by de Blasio in Inwood that was rejected by the City Council.

“There’s more incentive to move because they’ve seen the city’s other affordable housing programs stop … but we’re still not there,” the source said.

Send a Letter to the Editor

Join the Conversation:

Source link


Pin It on Pinterest

Share This
NBC tries to promote karate for 2020 Olympics, shows taekwondo
Ala. lawyer busted trafficking methamphetamine, 369 grams seized
Former Cuomo aide killed in crash on Long Island Expressway
Critics rip Cuomo plan that combines tax and wage subsidies
Oil prices fall as analysts say August price rally has been overblown
Asian shares slip, dollar stands tall on Fed hike bets
Japan Inc unenthused over Abe's stimulus, BOJ easing: Reuters poll
Facebook can climb more than 20 percent on ad growth: Barron's
Singapore Luxury Real Estate: Back to a Buyer's Market
Sail The Seven Seas With Ease In The Oyster 625 Bandido
The Montblanc Meisterstück Is On Point
The Wining Wines of the 2015 En Primeur Campaign
Can’t believe you ate the whole thing? Blame ‘false hunger’
Lead in NYC tap water is a danger despite quality system
Seattle toddler speaks first words after nearly drowning
Humans first infected Neanderthals with herpes, tuberculosis
Barbra Streisand Tells Apple to Fix Siri's Pronunciation of Last Name
Watch Metallica Debut Punishing 'Hardwired' Live at Minneapolis Concert
Matt Roberts, Original 3 Doors Down Guitarist, Dead at 38
Frank Ocean Reflects on Creating 'Blonde' in Tumblr Posts
Obama wants more choices for consumers using cable boxes
Sanders preaches economic equality at the Vatican
Senator calls out CUNY boss Milliken on campus anti-Semitism
Angry campaign making strange bedfellows out of bedfellows
Basketball Football Other Sports
SEE IT: Softball player pulls off behind-the-back bunt
Nets owner Mikhail Prokhorov’s office raided in Moscow
Isola: Phil Jackson no longer the cool, calm man on bench
Mobile Social
How carbon nanotubes could give us faster processors and longer battery life
Facebook’s new teens-only app Lifestage turns bios into video profiles
Looklive helps men shop by mimicking celebs’ styles