Affordable Neighborhoods for New Yorkers Tax Incentive (ANNY): 421-a Replacement Bill

January 19, 2022

Yesterday, New York State Governor Kathy Hochul announced a new program to incentivize affordable housing as part of the proposed Budget. The bill, if it were to be adopted by the State Legislature, would effectively replace the Affordable New York (421-a) program with the new ANNY program in Section 485 of the Real Property Law.

The Governor’s bill would allow developers to opt into the ANNY program if they had not previously received 421-a benefits and would otherwise be available for new construction commencing between June 15, 2022 and June 15, 2027 (to be completed no later than June 15, 2031).

ANNY aims to provide a deeper level of affordability for rental projects, and it establishes a new homeownership option. We believe that the homeownership option offers a compelling incentive to Condominium Sponsors, particularly in areas where market sales are at or below the comparable affordable sales prices.

Below is a summary of the three proposed affordability options within the ANNY program:

We will keep you abreast of any future developments. Please contact Mitchell Korbey or Brett Gottlieb for more information.

Affordable Housing and Community Development

Herrick’s Affordable Housing team draws upon the skills of our veteran attorneys in the representation of our clients, including for-profit and non-profit organizations, developers, general contractors and builders, public and private financial institutions and governmental agencies in multifaceted affordable real estate transactions of all sizes. Our team brings together general real estate, financing, tax credit syndication, tax exempt bond financing, zoning, land use, municipal law, not-for-profit, corporate governance, community development, affordable and market rate condominium and cooperative development and related specialties under one roof to service our clients working on affordable housing and community development projects. Click to learn more.

© 2022 Herrick, Feinstein LLP. This alert is provided by Herrick, Feinstein LLP to keep its clients and other interested parties informed of current legal developments that may affect or otherwise be of interest to them. The information is not intended as legal advice or legal opinion and should not be construed as such.