Introduction to Tax Relief for Mitchell-Lama Residents

Background on Mitchell-Lama Housing

The Mitchell-Lama program, sponsored by NYS Senator MacNeil Mitchell and Assembly Member Alfred Lama, was signed into law in 1955. It is the state’s affordable co-op housing program, with developments throughout New York City and the state. Residents of all NYC’s Mitchell-Lama houses are now poised to pay less in taxes, thanks to new legislation that Gov. Kathy Hochul is set to sign into law.

The New Legislation

Purpose and Scope

The new law, sponsored by Assembly Member Tony Simone and state Sen. Brad Hoylman-Sigal from Manhattan, would allow city officials to pass local property tax relief for Chelsea’s Penn South residents. It also builds on the governor’s recent budget, which automatically cuts taxes 50% for the nearly 100,000 New York City Mitchell-Lama households by providing a deeper shelter rent tax benefit.

Economic Factors

The governor made the affordability move for Mitchell-Lama residents in part because the buildings were built in 1955 and need maintenance and updates. However, other economic factors also contributed to the legislation. “With inflation driving up the cost of housing across the United States, my administration is cutting taxes for Mitchell-Lama residents in New York City in half, keeping money in the pockets of nearly 100,000 hardworking households,” Hochul said. “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.”

Impact on Penn South and Beyond

Operational Costs and Affordability

Meanwhile, Penn South faces rising operational costs, which threaten to impact building quality and future affordability for its residents, according to the governor’s office. While the city is experiencing an ongoing shortage of affordable housing, the legislation will help to preserve the long-term health of existing buildings, officials said.

Details of the Legislation

Delving deeper into the legislation, which was referred to as A8651A/S7780B in the State Assembly and State Senate, respectively, NYC is now authorized to provide tax relief to Penn South. Hochul, along with the state’s Housing and Community Renewal (HCR) agency, has made a series of investments to preserve Mitchell-Lamas throughout the city and state.

Previous Efforts and Challenges

Last year, amNewYork reported on a Mitchell-Lama resident who sued the Dayton Towers building complex in Queens after her apartment was left in disrepair for two years following a fire in the building in 2022. With rising costs of necessities from food to housing, state officials said they are ensuring that state-supervised Mitchell-Lama properties are “well-positioned” to make critical investments.

Conclusion

The new legislation is a significant step towards preserving affordable housing in New York City and the state. By providing tax relief to Mitchell-Lama residents, the state is helping to ensure that these critical housing developments remain affordable for middle-class New Yorkers. As the city and state continue to grapple with the challenges of affordable housing, this legislation is an important step in the right direction.

FAQs

• Q: What is the Mitchell-Lama program?
  A: The Mitchell-Lama program is the state’s affordable co-op housing program, sponsored by NYS Senator MacNeil Mitchell and Assembly Member Alfred Lama, and signed into law in 1955.
• Q: How will the new legislation affect Mitchell-Lama residents?
  A: The new legislation will cut taxes 50% for the nearly 100,000 New York City Mitchell-Lama households, providing a deeper shelter rent tax benefit.
• Q: What are the economic factors contributing to the legislation?
  A: The economic factors include the need for maintenance and updates of the buildings, which were built in 1955, as well as the rising costs of necessities from food to housing.
• Q: How will the legislation impact Penn South?
  A: The legislation will help to preserve the long-term health of Penn South by providing tax relief, which will help to offset rising operational costs and ensure the building remains affordable for its residents.
  
  NYS Gov. Kathy Hochul discusses affordable housing in NYS.
  Photo credit: Susan Watts/Office of Governor Kathy Hochul