By Konrad Putzier
The City Council has launched a task force to study the efficacy of New York’s tax breaks.
The 11-member group, whose existence was first reported by Capital New York, is the latest example of a recent increase in public scrutiny over tax-abatement programs, including the 421-a program.
The tax incentive for residential developers is up for renewal in June. Critics have argued that it merely enriches developers and landowners, while doing too little to create affordable housing.
“(The task force) was something that the city council resolved to do last year,” Dan Garodnick, councilman and founding member of the group, told Real Estate Weekly.
He explained that the group will study ways to determine the efficacy of tax incentive programs, as well as evaluate the programs themselves.
“We have not quite yet made any official decision as to which programs were going to evaluate,” he said.
“We have a whole lot of programs out there, and we need to make sure that we are getting a real bang for our buck.”
According to Garodnick, the group has met twice so far and will continue to meet about once a month. Its members include council speaker Melissa Mark-Viverito, council member Julissa Ferraras, 32BJ SEIU’s Hector Figueroa, Michael Simas of the Partnership for NYC and RXR’s Seth Pinsky.
Pinsky, an executive vice president at RXR and former president of the New York City Economic Development Corporation, hopes to use his role in the task force to scrutinize the city’s incentive programs for the manufacturing sector.
“I think that we need to ask ourselves what the market is not producing today. That, ultimately, is what the government should be investing in,” Pinsky said.
While he lauded the de Blasio administration for investing in affordable housing, he argued for a greater focus on the “income side” of affordability: creating well-paying jobs in manufacturing.
“We as a city have made the decision that (investing in housing) is worth it to create a public good. I am not sure why we wouldn’t think of being equally aspirational when it comes to the other side of the affordability equation,” he argued.
Pinsky said he sees room for improvement in the Industrial and Commercial Abatement Program (ICAP), an incentive program for manufacturing firms, as well as the New York City Industrial Development Agency (NYCIDA).
He argued that tax incentive programs could be made more easily accessible through administrative and legislative changes. What exactly these changes might be is up for the task force to find out.
