NY State Senate Bill 2025-S4414

Senate Bill S4414

2025-2026 Legislative Session

Establishes an optional local tax exemption for affordable multi-family housing, to be implemented based on regional recommendations developed by the division of housing and community renewal

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Current Bill Status - In Senate Committee Housing, Construction And Community Development Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 04, 2025	referred to housing, construction and community development

2025-S4414 (ACTIVE) - Details

Current Committee:: Senate Housing, Construction And Community Development
Law Section:: Real Property Tax Law
Laws Affected:: Add §421-r, RPT L
Versions Introduced in 2023-2024 Legislative Session:: S7865

2025-S4414 (ACTIVE) - Summary

Establishes an optional local tax exemption for affordable multi-family housing, to be implemented by cities, towns and villages based on recommendations developed by the division of housing and community renewal for each economic development region.

2025-S4414 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S4414

SPONSOR: MAY
 
TITLE OF BILL:

An act to amend the real property tax law, in relation to establishing
an optional local tax exemption for affordable multi-family housing

 
PURPOSE:

To establish region-specific affordable housing recommendations

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1 proposes tax exemptions for newly-constructed or converted
rental multiple dwellings, with affordability criteria, region-specific
recommendations, and periodic updates by the Division of Homes and
Community Renewal

Section 2 establishes the effective date of the bill

JUSTIFICATION:

In our current housing systems, Industrial Development Agencies (IDAs)
across the state typically evaluate proposals for housing tax exemptions
on a case-by-case basis. This system is inefficient and increases the
risk of municipalities entering into unfavorable agreements. Developers
seeking to build affordable housing also do not know what standards and
policy to aim for, which makes the process of building unpredictable and
difficult.

By setting standards up front through local laws, housing developers can
know what requirements for affordability are to be granted, and can plan
accordingly. Upfront standards ensure good deals for municipalities by
establishing clear criteria, helping communities achieve their afforda-
ble housing goals by using tax policy as a clear tool.

The recommendations will be updated every two years by the Department of
Homes and Community Renewal, ensuring that affordable housing policies
remain up-to-date and adapt to changing economic conditions,
construction costs, and housing market dynamics. This flexibility allows
the state to respond promptly to evolving challenges and opportunities
in housing. This aims to address the challenges posed by expensive and
affordable housing markets, establishing a more comprehensive strategy
than the current ad hoc system.

 
LEGISLATIVE HISTORY:

2023-2024: S.7865-A (May) / A.9680-A (Kelles)

 
FISCAL IMPLICATIONS:

None

 
EFFECTIVE DATE:
Immediately

2025-S4414 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4414
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             February 4, 2025
                                ___________
 
 Introduced  by  Sen.  MAY  --  read  twice and ordered printed, and when
   printed to be committed to the Committee on Housing, Construction  and
   Community Development
 
 AN  ACT  to amend the real property tax law, in relation to establishing
   an optional local tax exemption for affordable multi-family housing

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  The  real  property  tax  law  is amended by adding a new
 section 421-r to read as follows:
   § 421-R. EXEMPTION OF NEWLY-CONSTRUCTED OR CONVERTED  RENTAL  MULTIPLE
 DWELLINGS.  1.    (A) A CITY, TOWN OR VILLAGE MAY, BY LOCAL LAW, PROVIDE
 FOR THE EXEMPTION OF RENTAL MULTIPLE DWELLINGS CONSTRUCTED OR  CONVERTED
 IN A BENEFIT AREA DESIGNATED IN SUCH LOCAL LAW FROM TAXATION AND SPECIAL
 AD  VALOREM  LEVIES,  AS  PROVIDED  IN  THIS  SECTION. SUBSEQUENT TO THE
 ADOPTION OF SUCH A LOCAL LAW, ANY OTHER MUNICIPAL CORPORATION  IN  WHICH
 THE DESIGNATED BENEFIT AREA IS LOCATED MAY LIKEWISE EXEMPT SUCH PROPERTY
 FROM  ITS TAXATION AND SPECIAL AD VALOREM LEVIES BY LOCAL LAW, OR IN THE
 CASE OF A SCHOOL DISTRICT, BY RESOLUTION.
   (B) AS USED IN THIS SECTION, THE TERM "BENEFIT AREA"  MEANS  THE  AREA
 WITHIN  A  CITY,  TOWN  OR VILLAGE, DESIGNATED BY LOCAL LAW, TO WHICH AN
 EXEMPTION, ESTABLISHED PURSUANT TO THIS SECTION, APPLIES.
   (C) THE TERM "RENTAL MULTIPLE DWELLING" MEANS A STRUCTURE, OTHER  THAN
 A  HOTEL,  CONSISTING OF TWENTY OR MORE DWELLING UNITS, WHERE ALL OF THE
 UNITS ARE RENTED FOR RESIDENTIAL PURPOSES, AND SUCH UNITS, UPON  INITIAL
 RENTAL  AND  UPON  EACH SUBSEQUENT RENTAL FOLLOWING A VACANCY DURING THE
 BENEFIT PERIOD, ARE AFFORDABLE TO AND RESTRICTED TO OCCUPANCY  BY  INDI-
 VIDUALS  OR  FAMILIES  WHOSE  HOUSEHOLD INCOME DOES NOT EXCEED A CERTAIN
 PERCENTAGE, AS DETERMINED BASED  ON  RECOMMENDATIONS  DEVELOPED  BY  THE
 DIVISION  OF HOUSING AND COMMUNITY RENEWAL FOR EACH ECONOMIC DEVELOPMENT
 REGION, OF THE AREA MEDIAN INCOME, ADJUSTED FOR FAMILY SIZE, ON AVERAGE,
 AT THE TIME THAT SUCH HOUSEHOLDS INITIALLY OCCUPY SUCH  DWELLING  UNITS.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08680-01-5

 S. 4414                             2
 
 SUCH  RESTRICTION PERIOD SHALL BE IN EFFECT COTERMINOUS WITH THE BENEFIT
 PERIOD, PROVIDED, HOWEVER, THAT THE  TENANT  OR  TENANTS  IN  AN  INCOME
 RESTRICTED  DWELLING UNIT AT THE TIME SUCH RESTRICTION PERIOD ENDS SHALL
 HAVE  THE  RIGHT  TO LEASE RENEWALS AT THE INCOME RESTRICTED LEVEL UNTIL
 SUCH TIME AS SUCH TENANT OR  TENANTS  PERMANENTLY  VACATE  THE  DWELLING
 UNIT.
   2.  (A)  THE  DIVISION  OF HOUSING AND COMMUNITY RENEWAL SHALL DEVELOP
 RECOMMENDATIONS FOR EACH ECONOMIC DEVELOPMENT REGION, AS ESTABLISHED  BY
 SECTION  TWO  HUNDRED  THIRTY OF THE ECONOMIC DEVELOPMENT LAW, REGARDING
 THE IMPLEMENTATION OF THE EXEMPTION CREATED UNDER THIS SECTION.  CITIES,
 TOWNS,  AND  VILLAGES  PROVIDING SUCH EXEMPTION SHALL HAVE THE OPTION TO
 OPT INTO SUCH RECOMMENDATIONS.
   (B) SUCH RECOMMENDATIONS SHALL:
   (I) CONSIDER THE FINANCIAL FEASIBILITY OF CONSTRUCTING NEW HOUSING  OR
 CONVERTING A NON-RESIDENTIAL STRUCTURE TO A RENTAL MULTIPLE DWELLING AND
 OPERATING  SUCH  HOUSING  IN EACH ECONOMIC DEVELOPMENT REGION, INCLUDING
 ANY VARIATION IN CONSTRUCTION COSTS AND  OPERATING  INCOMES  FOR  RENTAL
 MULTIPLE  DWELLING  PROJECTS IN DIFFERENT PARTS OF EACH SUCH REGION, AND
 AMONG SUBSIDIZED AND UNREGULATED RENTAL MULTIPLE DWELLING PROJECTS;
   (II)  INCLUDE  RECOMMENDATIONS  FOR  BOTH  RENTAL  MULTIPLE   DWELLING
 PROJECTS  RECEIVING ADDITIONAL SUBSIDIES OR EXEMPTIONS AND RENTAL MULTI-
 PLE DWELLING PROJECTS RECEIVING NO ADDITIONAL SUBSIDIES  OR  EXEMPTIONS;
 AND
   (III)  INCLUDE  RECOMMENDATIONS  FOR THE CONVERSION OF NON-RESIDENTIAL
 PROPERTY FOR RESIDENTIAL USE.
   (C) SUCH RECOMMENDATIONS SHALL BE UPDATED BY THE DIVISION  OF  HOUSING
 AND COMMUNITY RENEWAL NO LESS THAN ONCE EVERY TWO YEARS.
   3.  APPLICATION  FOR  EXEMPTION  UNDER THIS SECTION SHALL BE MADE ON A
 FORM PRESCRIBED BY THE COMMISSIONER AND FILED WITH THE  ASSESSOR  ON  OR
 BEFORE THE APPLICABLE TAXABLE STATUS DATE.
   4.  IN  THE CASE OF A NEWLY CONSTRUCTED OR CONVERTED PROPERTY WHICH IS
 USED PARTIALLY AS A RENTAL MULTIPLE DWELLING AND PARTIALLY  FOR  COMMER-
 CIAL  OR  OTHER  PURPOSES, THE PORTION OF THE PROPERTY THAT IS USED AS A
 RENTAL MULTIPLE DWELLING SHALL BE ELIGIBLE FOR THE EXEMPTION  AUTHORIZED
 BY THIS SECTION IF:
   (A) THE SQUARE FOOTAGE OF THE PORTION USED AS A RENTAL MULTIPLE DWELL-
 ING  REPRESENTS  AT  LEAST  FIFTY  PERCENT  OF THE SQUARE FOOTAGE OF THE
 ENTIRE PROPERTY;
   (B) THE RENTAL UNITS ARE AFFORDABLE  TO  INDIVIDUALS  OR  FAMILIES  AS
 DETERMINED  ACCORDING  TO  THE  CRITERIA  SET  FORTH IN PARAGRAPH (C) OF
 SUBDIVISION ONE OF THIS SECTION; AND
   (C) THE REQUIREMENTS OF THIS  SECTION  ARE  OTHERWISE  SATISFIED  WITH
 RESPECT  TO THE PORTION OF THE PROPERTY USED AS A RENTAL MULTIPLE DWELL-
 ING.
   5. THE EXEMPTION AUTHORIZED BY THIS SECTION SHALL NOT BE AVAILABLE  IN
 A CITY WITH A POPULATION OF ONE MILLION OR MORE.
   6.  ANY RECIPIENT OF THE EXEMPTION AUTHORIZED BY THIS SECTION OR THEIR
 DESIGNEE SHALL CERTIFY COMPLIANCE WITH THE PROVISIONS  OF  THIS  SECTION
 UNDER  PENALTY  OF  PERJURY, AT SUCH TIME OR TIMES AND IN SUCH MANNER AS
 MAY BE PRESCRIBED IN THE LOCAL LAW ADOPTED BY THE CITY, TOWN OR  VILLAGE
 PURSUANT  TO  PARAGRAPH  (A) OF SUBDIVISION ONE OF THIS SECTION, OR BY A
 SUBSEQUENT LOCAL LAW. SUCH CITY, TOWN  OR  VILLAGE  MAY  ESTABLISH  SUCH
 PROCEDURES AS IT DEEMS NECESSARY FOR MONITORING AND ENFORCING COMPLIANCE
 OF AN ELIGIBLE BUILDING WITH THE PROVISIONS OF THIS SECTION.
   § 2. This act shall take effect immediately.

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