March 23, 2017
Sales at a single super-tall luxury building would have generated $30 million under the Mayor’s Mansion Tax, and funded rental assistance for 2,000 seniors struggling to pay rent
NEW YORK—Standing in front of Manhattan’s tallest residential building, Mayor Bill de Blasio today urged Albany to approve a Mansion Tax for New York City.
If it was on the books, the Mayor’s proposed 2.5 percent marginal tax would have raised $30.2 million dollars for the “Elderly Rental Assistance Program” from 62 sales at Manhattan’s 432 Park Avenue since December 2015, according to Department of Finance records.
The levy from this one building would have helped 2,000 low-income seniors cover their rent. All told, the Mayor’s proposed Mansion Tax would generate $336 million annually, enough to support 25,000 seniors with rental assistance of up to $1,300 a month.
“We’re in a housing crisis pushing seniors out of their neighborhoods. We can’t afford more missed opportunities like this. Sales at this one building alone would have kept 2,000 seniors in their homes. With tax cuts for the wealthy coming from Washington, New York needs to stand up. We need Albany to support those who built this city and pass the Mansion Tax,” said Mayor Bill de Blasio.
“When I put my name on a piece of legislation, I fight tooth and nail to see it through. This is worth the fight. I will work to make each of my colleagues aware how much of an impact this will make,” said State Senator Diane J. Savino, lead sponsor of Senate Bill S.5336.
“In New York City, there are hundreds of thousands of fixed-income seniors who cannot afford to pay their rent and still buy medication, food and other necessities, and many of them simply do not have the luxury of waiting years for an affordable apartment to become available,” said Assembly Member Steven Cymbrowitz, Chair of the Committee on Housing and lead sponsor of Assembly Bill A.6584. “For a population desperately in need of safe and affordable housing options, the Elder Rental Assistance Program – an initiative created jointly by the Assembly and the Mayor's Office – is an innovative response that will restore hope to 25,000 struggling seniors, giving them the ability to remain in their homes and communities and age in place with the dignity that they so deserve."
With Mansion Tax bills pending in Albany – Assembly bill A.6584 and Senate bill S.5336 – the facts are clear: At 432 Park Ave., the penthouse apartment sold for $65.6 million in January. Had the Mansion Tax been in place, the funds raised for seniors: $1.6 million, enough to help more than 100 seniors now struggling to afford rent. The 10 most expensive homes in the building sold for a combined total of $426 million, and would have generated $10.2 million for the proposed rental assistance program under the Mansion Tax. Even in this white-glove building, a dozen apartments that sold for less than $2 million would not have been subject to the tax.
Citywide, only 8.5 percent of the City’s residential property sales in the most recent fiscal year would have been impacted by the tax.
“Seniors who live on fixed incomes are among the hardest hit by the City’s affordable housing shortage. The Mayor’s proposed Mansion Tax will allow seniors to remain in their communities at rents they can afford,” said Department for the Aging Commissioner Donna M. Corrado.
“We owe it to our seniors, who helped build our city and make it great, to help them stay in their homes and neighborhoods,” said HPD Commissioner Maria Torres-Springer. “With federal support for housing programs under threat, the Mayor's proposed mansion tax would ensure a source of much-needed funding for rental assistance for low-income seniors who are struggling to make ends meet. We urge Albany to act.”
“In order to address this historic affordability crisis, we need new tools to allow seniors to age with dignity in the City they helped build,” said Council Member Margaret S. Chin, Chair of the Committee on Aging. “That is why I call on Albany to act on the Mayor’s proposal, which would aid thousands of seniors who are at risk of getting pushed out of their homes and their neighborhoods. For these vulnerable New Yorkers, the time to act is now.”
Earlier today, Mayor de Blasio visited two senior centers – the Hanac Harmony JVL Innovative Senior Center in Astoria, Queens and the Carter Burden Luncheon Club & Senior Program on the Upper East Side, two neighborhoods with some of the highest rent burdened seniors in New York City.
The bills pending in Albany establish the Elder Rental Assistance Program, funded by the Mansion Tax. The tax institutes a 2.5 percent marginal tax for incremental sales price over $2 million. According to recent data, the policy would affect the top 4,500 residential real estate transactions in the upcoming fiscal year and would generate approximately $336 million. Those funds would be devoted to ERAP, and aid 25,000 New Yorkers, 62 years and older who earn less than $50,000 per year.
The rental assistance would ensure a senior living on a Social Security check of $1,350 per month would spend no more than $450 per month on rent – helping them stay in their home and age with dignity.