New York's most generous tax break may bite the dust

Good morning. It is Friday. We look at the end of an expensive real estate subsidy that has shaped the city since the 1970s. We also look at inequality in parks and swimming pools.

Since 1971, almost every major residential real estate project in New York City has benefited from a grant known as 421a.

It’s the city’s most generous tax break, costing it $1.77 billion a year in foregone tax revenue.

And in just over three weeks it will likely go the way of casual suits, pet bricks and the Ford Maverick.

The state legislature is unlikely to extend the grant before it expires on June 15. Concerned builders are rushing to work out new projects to qualify for 421a before then, particularly in the Gowanus area of Brooklyn, which was repurposed for large-scale residential projects last year.

Governor Kathy Hochul pushed for a revised and renamed version of 421a, but she found no support in the Democrat-controlled legislature. Lawmakers and real estate officials say there was reluctance to extend a lucrative tax credit for the real estate sector ahead of the November elections.

“A lot of people have serious reservations about 421a in its current configuration,” said Councilman Jeffrey Dinowitz, a Democrat who represents parts of the Bronx, adding, “I just don’t think we’re getting our money’s worth with 421a.”

Developers usually had to build rental properties that were below market price in exchange for the tax breaks on market-standard apartments and condominiums. But critics of the provision say it amounted to a giveaway as developers kept the mix of low-income units as lean as possible.

“421a is a broken, absurdly expensive plaster to be put on top of New York City’s broken property tax system,” said Brad Lander, the city’s auditor who has pushed for the tax break to end. “It’s a good thing it’s not being renewed.”

The impact of letting the subscription expire will only be felt in a few years. Matthew Murphy, the executive director of New York University’s Furman Center for Real Estate and Urban Policy, said 421a rental projects now underway would take some time. After that, he predicted, developers will prefer condominiums, which yield higher returns.

But ending 421a won’t make an expensive city more affordable.

“All it does is introduce a huge amount of uncertainty into development,” he said, “and exacerbate the housing shortage in the long run.”

Weather

Expect a cloudy day, with temperatures reaching into the high 70s. Light rain may fall in the morning. Showers are likely to be later, with nighttime temperatures dropping into the mid-60s.

ALTERNATE SIDE PARKING

Suspended on Monday (Memorial Day).

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Swimming pools, parks and inequality

Many of us will think about visiting the beaches or relaxing in the parks this Memorial Day weekend. But in aging cities like New York, summer isn’t all joy. Heat kills about 350 New Yorkers a year, and the risk isn’t evenly distributed. According to city data, black New Yorkers are more than twice as likely to die from the heat as white residents. I asked my colleague Anne Barnard to discuss the inequalities New Yorkers see every day without always realizing its impact.

Life unfolds again in public space as New York, somewhat restless, returns from the pandemic. Everyone should be able to take advantage of parks, public swimming pools and libraries. But the amenities are not the same from neighborhood to neighborhood, are they?

New. Last summer, DailyExpertNews reporters roamed the city to see how the differences affect people’s lives. What we’ve learned points to who will suffer the most from the heat this summer.

Consider this: In Crotona Park East in the Bronx, 41 percent of residents fall below the federal poverty line, 24 percent of households have no air conditioning, and few have cars to get to beaches or forests.

In contrast, in Carnegie Hill on the Upper East Side, one of the wealthiest and whitest parts of the city, 96 percent of households have air conditioning. And so many residents have the money and flexibility to leave the city in the summer that some streets felt empty during the hottest weeks of last year. Central Park is nearby, but many in Carnegie Hill weren’t there to take advantage of it.

New York built large, elegant public swimming pools in the 1930s. They were symbols of civic pride and public investment. What about now?

New York has less than one swimming pool per 100,000 residents. That’s less than most U.S. cities, with more per capita in Manhattan and Staten Island, the wealthiest boroughs, according to the Trust for Public Land.

Black and Latino children try to access swimming lessons and are more likely to drown. And in fact, many pools in New York remain largely segregated.

Amid the tensions of the late 1960s, the city opened smaller swimming pools in underserved black and Latino neighborhoods. But restrictions imposed in response to violence at the pools restrict what people can wear outside the locker rooms. Such rules created what Jesse Amaro, who lives in the Bronx, called “a prison-yard mentality” when we spoke to her while waiting to get into the Crotona Pool one afternoon last summer.

Mark Focht, a deputy commissioner for parks, said the city is working to improve swimming pools in the hottest, most deprived areas. Sixteen aging pools in the city have received upgrades costing nearly $5 million, he said †the atmosphere of a country club or resort.”

But it’s fair to say that the biggest pools still fall short of the faded glory.

Is the problem too little money?

Eric Adams, first as a candidate and more recently as mayor, said he would adjust park spending to a new starting point, 1 percent of the city budget. That would work out to about $1 billion, but his proposed budget included only about half that amount. His deputy press secretary, Charles Lutvak, said in an email that the budget was “a down payment on his ‘Percent for Parks’ pledge” and that the full amount will be reached at some point while Adams is in office.

Dear Diary:

I live in up north Queens and never drive into Manhattan if I can help it. But one Sunday afternoon while I was sitting at home, I remembered that when I got back from work Friday night, I had parked in a spot that had street cleaning Monday from 9:30 AM to 11:00 AM and I had an appointment at 10:00 AM in Manhattan on Monday.

I went looking for a place where I wouldn’t have to move the car the next day. After circling several blocks nearby, I realized the only available spots would force me to do so. Everything else was full.

I accepted my fate and found a possible space for my building. It was near a fire hydrant and actually big enough for two cars, but one was already parked in a way that barely left enough room for mine.

Nevertheless, I pulled in and started backing up when I realized the driver was in the car that was there. I got out of my car and walked over to him.

“Will you stay here until morning?” I said. “I want to oppose you, so I’m not in the fire hydrant zone.”

“What time do we have to move tomorrow?” he asked

“9:30 PM,” I said, “but I’ve been gone a long time.”

“No problem,” he said. “Go for it.”

I jumped into my car and backed up to within 6 inches of his bumper. As I got out of the car, he called out to me.

He held a long slim package in a white bread bag.

“Take this!” he said.

“What is it?” I asked

“A baguette. I have two! It’s fresh.”

“Did you make this?”

“Yes, enjoy it.”

“Wow! Thank you, I will.”