Testimony: A Review of the 421-a Tax Benefit Program

Testimony by Leigh Mangum, Staff Attorney, before the New York City Council, Committee on Housing and Buildings: Oversight: A Review of the 421-a Tax Benefit Program

January 29, 2015

Chair Williams, Council Members, and staff, good morning and thank you for the opportunity to speak about the 421-a tax benefit program. My name is Leigh Mangum and I am a Staff Attorney at the New York Legal Assistance Group (NYLAG). NYLAG is a nonprofit law office dedicated to providing free legal services in civil law matters to low-income New Yorkers. NYLAG serves immigrants, seniors, the homebound, families facing foreclosure, tenants facing eviction, low-income consumers, those in need of government assistance, children in need of special education, domestic violence victims, persons with disabilities, patients with chronic illness or disease, low-wage workers, low-income members of the LGBT community, Holocaust survivors, as well as others in need of free legal services.

First, we would like to applaud the Administration and the Council’s acknowledgment of the housing crisis in our city. At NYLAG, we are not experts on housing finance; we approach this issue from the perspective of representing tenants in housing court where our clients live in apartments that are rent stabilized because of their landlords’ receipt of 421-a tax benefits, as well as daily witnesses to the effects of New York’s policies on the lives of low-income citizens.

NYLAG strongly supports the creation and preservation of affordable housing. As the Council is undoubtedly aware, New York City is losing rent stabilized apartments at an alarming pace; the city lost more than 150,000 rent stabilized apartments between 1994 and 2012. At the same time, aging subsidized buildings are opting out of their subsidies.1

Affordable rental housing, where tenants have a right to renew their lease, offers stability for low-income New Yorkers and for our neighborhoods. Our clients who live in non-regulated housing leave their family, friends, support services, and medical providers annually, and their children are forced to constantly change schools.

The 421-a program began in the 1970s to encourage development during undoubtedly rough years for the city. But now, there are few neighborhoods where one could argue with a straight face that development need be encouraged. However, the housing crisis is perhaps worse than it has ever been. We can consider the city shelter population for evidence. This week, on Monday night, 58,602 individuals were in the city shelter system, with 72% of them being a part of a family with children.2 There is obviously a disconnect that the 421-a program is not addressing.

Much of our skepticism about the program also comes from the fact that as advocates who represent tenants, we have most often interacted with the 421-a program when landlords seek eviction of our clients in a type of housing court case where they claim that the tenant’s lease has expired and there is no right to renew. I can’t understate the sense of happiness for a client when you discover that their apartment is rent stabilized and they have a right to continue living there with their family. However, in our experience, there are many landlords in the city who are receiving the benefit of the 421-a exemption but are doing their best not to play by the rules of the rent stabilization requirement that comes with it. These experiences have come largely in the outer boroughs.

On the other hand, we also see tenants whose apartments are rent stabilized due to a 421-a tax exemption, but their rents cannot be considered affordable to a low or even middle income family. A rent of $4,000 per month, for example, isn’t affordable to many families in New York City, let alone our low-income clients.

We would be happy to work together with the Council and other advocates in finding a solution to New York City’s housing emergency. Again, we commend the Administration and the Council’s commitment to addressing it.

Thank you for the opportunity to testify today.

Respectfully submitted,
Leigh Mangum


1: Office of the Mayor, City of New York, Housing New York: A Five-Borough, Ten-Year Plan, pp. 22-23. Available at http://www.nyc.gov/html/housing/assets/downloads/pdf/housing_plan.pdf. Accessed January 28, 2015.

2: New York City Department of Homeless Services, Daily Report: Daily Shelter Census. Available at http://www.nyc.gov/html/dhs/downloads/pdf/dailyreport.pdf. Accessed January 28, 2015.