Give Gov. Andrew Cuomo credit for honoring the “Pottery Barn rule”: He broke the 421-a tax credit that’s vital to allowing non-luxury residential construction in the city — and he’s finally moved to fix it.
Pushed by Cuomo, building trades unions finally agreed to what developers had been offering for a year or so: above-market pay rates on large 421-a jobs — but not the sky-high scale some in labor had demanded.
To be fair, it was Mayor Bill de Blasio who opened Pandora’s Box here, with his push to revise the 421-a law to yield more subsidized housing. But City Hall had worked with the builders for reforms they could live with; Cuomo simply jumped in at the end to insert a veto for the construction unions.
Backed by the governor, the unions wanted to require “prevailing wages” on all 421-a projects — which actually means far-above-market-rate pay. That would have hiked costs by $80,000 or more per affordable unit, dooming de Blasio’s promise to increase subsidized housing in the city.
Worse, it froze the pipeline on all new non-luxury market-rate construction — when the last buildings that qualified under the old rules got finished this year, work would grind to a halt.
The gov’s move also put the state’s $2 billion affordable housing program in limbo.
The new deal won’t require union pay rates. On Manhattan projects below 96th Street, it means an average of $60 an hour in wages and benefits — about $124,000 a year. Along the Brooklyn and Queens waterfront, it’s $45 an hour on buildings of 300 or more units.
It’s not a done deal until the state Legislature passes it — which requires a special session. And lawmakers are peeved over Cuomo’s threat to scuttle the pay hike they’re hoping for.
The city needs this done, and Cuomo has a duty to finish cleaning up the mess. Let’s hope he and the mayor can persuade Senate Majority Leader John Flanagan and Assembly Speaker Carl Heastie to do the right thing.
Inaction is unacceptable — and every politician in America is now on notice that the voters really can revolt.