Really Ugly

The Legislature tonight approved a four year extension of rent regulations that will raise the high rent/high income deregulation threshold from $2500 to $2700 immediately, and increase it again annually, beginning next January, by the one year renewal lease guideline set by the Rent Guidelines Board. The Big Ugly bill also reduces the return on Major Capital Improvements to 1/96th in buildings with 35 or fewer units and 1/108th for larger buildings, but does leave the increases permanent. It will also reduce the statutory vacancy allowance from 20 percent to a range of 5-20 percent on units that had preferential rents and had their last vacancy less than four years ago. Fines for harassing tenants are increased, as well. Current 421a tax abatement provisions are continued until December 31st. After that, a menu of complicated affordability options will allow developers to receive up to 35 year tax breaks, but “only on the condition that on or before January Fifteenth, Two Thousand Sixteen, a memorandum of understanding is executed by one, or more, representative of the largest trade association of residential real estate developers, either for profit or not-for-profit, in New York City as well as one, or more, representative of the largest trade labor association representing building  and construction workers, with membership in New York City…regarding…wages for construction worker on buildings over 15 units”…whoever and whatever that means.

The Big Ugly is called that because it is a legislative session-ending sausage that includes many unrelated items. In addition to rent regulations and 421a, this year, it includes property tax rebates, extension and modification of the condo and co-op tax break, a loft law extender, energy credits, charter school changes, education aid, mayoral control of schools, various motor vehicle taxes, and a provision that lets the Governor perform marriages.

Because of the temporary lapse in the rent laws last week, the New York City Rent Guidelines Board postponed its vote on increases for the year beginning October 1st until Monday, June 29th. Meanwhile, the Westchester Rent Guidelines Board took advantage of the temporary extender to meet and pass one and two year guidelines of  1.75 percent and 2.75 percent, respectively.

The Supreme Court, Thursday morning, voted 5-4 to allow disparate impact challenges under the Fair Housing Act — essentially saying that private developers or government agencies could be guilty of discrimination based on the results of policies or business decisions rather than the intent. At the same time, the Court said that “Policies, whether governmental or private, are not contrary to the disparate-impact requirement unless they are ‘artificial, arbitrary, and unnecessary barriers.’” In other words, anything you do can be challenged and it will be up to the courts to decide each case ad hoc.

The City Economic Development Corporation is looking for expressions of interest in developing 4.75 acres in Hunts Point on the site of the Spofford Detention Center. The City wants “live-work” proposals for affordable housing and job creation.

But it will be harder to build or preserve housing on the Upper West Side because the Landmarks Preservation Commission, Wednesday, added 344 buildings in the area from 94th to 108th Street between West End Avenue and Riverside Drive to the Riverside-West End Historic District.

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