(The Center Square) — Tenants in New York City’s Mitchell-Lamas co-op housing program will see their taxes cut under a bill signed into law by Gov. Kathy Hochul on Tuesday.
The legislation could save Mitchell-Lama residents in New York City up to $50 million annually by allowing city officials to pass local property tax relief for Chelsea’s Penn South residents, which would reduce the shelter rent tax burden for Article V co-ops in half — from 10% to 5% — to offset rising operational costs.
A $254 billion state budget, signed by Hochul in May, automatically cut taxes 50% for nearly 100,000 New York City Mitchell-Lama households by providing a deeper shelter rent tax benefit. But the spending plan didn’t include tax relief for Penn South residents and other Article V co-ops in the city. Lawmakers filed a bill expanding the tax relief and launched a campaign to push for its approval.
Hochul said the bill she signed Tuesday corrects that and will ease the financial burdens on the city’s affordable housing providers, allowing them to invest more in building maintenance and repairs amid rising costs.
“With inflation driving up the cost of housing across the United States, my administration is cutting taxes in half for Mitchell-Lama residents in New York City, keeping money in the pockets of nearly 100,000 hard-working households,” the Democrat said in a statement.
Established in 1955, Mitchell-Lama is a state and city program that provides subsidized, affordable housing for middle-income families through both cooperative and rental buildings.
Hochul said the legislation she signed Tuesday builds on her “affordability” agenda in this year’s budget, including a $2 billion “inflation refund” program in which the state began to distribute last month checks of up to $400 to around $8 million households.
“Since I took office, the state has invested nearly $500 million in Mitchell Lamas statewide to preserve more affordable housing for middle-class New Yorkers,” she said.
Hochul administration officials said the new law will help preserve the long-term health of existing buildings as the city is facing an ongoing shortage of affordable housing.
State Sen. Brad Hoylman-Sigal, D-Manhattan, one of the bill’s primary sponsors, said the measure will save Penn South up to $2 million annually to help the coop “remain an oasis of affordability in a sea of rising rents across Manhattan.”
“Affordable housing developments in New York City are facing rising operating costs, which have threatened the long-term viability for these developments to remain affordable,” Hoylman-Sigal said in a statement.
Because the tax relief was passed by the state Legislature, it doesn’t need to go before the New York City Council for final approval.
