Urban Prospect: Reassessing Tax Incentives

Hoping to tie renovation of its troubled in rem buildings to renewed market interest in residential housing, the Giuliani administration is expected to release a proposal in the coming months to amend the 421a Program. Last year’s 7,428 new dwelling units represent less than two-thirds of the housing created in 1971, when concern over lagging residential production motivated the state legislature to establish the 421a tax exemption program. Expected to facilitate the development of more than 150,000 units in its first three years, 421a has taken more than 25 years to foster 100,000 new apartments.