Mayor Seeks to Reform 421a Reform

The Bloomberg Administration has another favor to ask of the state Legislature, along with passing congestion pricing: change a law you just passed on the 421a property tax abatement.

The Mayor was none too pleased with the Legislature’s revision of the program and even asked Governor Spitzer to veto it. But it turns out Mr. Spitzer might not have to, because the bill, passed in different versions by the Senate and the Assembly, has not even made it to the Governor’s desk.

“The position is still that we are negotiating to try to get a better bill before it goes to the Governor’s desk,” said Neill Coleman, spokesman for the city Department of Housing Preservation and Development. “Then we are looking for a veto. Right now there isn’t a bill before the Governor to veto.”

Mr. Coleman said that housing officials were talking with legislators, including Vito Lopez, the chairman of the Assembly’s housing committee. If the Assembly returns along with the Senate on Monday to vote on congestion pricing, an amendment could be introduced Friday night to give it enough time to mature to be eligible for a vote the following week.

The city wants the Legislature to make three changes: extend the abatement to government-supported middle-income housing, such as that planned for Queens West; shrink the so-called exclusion zone; and retract the $300 million additional tax break that Atlantic Yards, alone among new developments in Brownstone Brooklyn, would qualify for.

Meanwhile, on Wednesday, two Brooklyn legislators who represent the Atlantic Yards footprint asked the complex’s developer, Forest City Ratner, to commit to building more low-income condominium units on the 22-acre site, a means to comply with the spirit of the Assembly’s bill even though, technically, it does not really have to.

Assemblywoman Joan Millman, who represents a district directly to the west of Atlantic Yards, said she would have signed the letter also but had been on vacation. “This is a developer who has gotten many, many tax benefits from the city and state,” she told The Observer. “This is just another piece.”

However, another area Assemblyman, James Brennan, who has been one of the more vocal critics of the project, said last week that he did not object to the paragraph that gave Atlantic Yards special treatment. That’s because current law would have automatically given tax abatements to all of the Atlantic Yards buildings; it is just that current law that expires at the end of December. The state legislation renews the program and, in the process, makes all new apartment buildings in Prospect Heights, along with much of the rest of the city, ineligible for the 421a abatement unless they include low-income housing on the premises.

“It’s not a carve-out,” Mr. Brennan told The Observer last week. “The only thing that happened was that Atlantic Yards got grandfathered in.”