Hochul Promises to Lift Residential FAR Cap, Replace 421a, Study Triboro RX

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New York Gov. Kathy Hochul announced a slew of new initiatives during her first State of the State address Wednesday, including a review of the long-proposed “Interborough Rapid Express” — known as the Triboro RX, lifting the state’s cap on residential density, and drafting a new version of the 421a tax break. 

Her 237-page policy book outlines plans to repeal the state cap on residential density in New York City, which currently limits the residential floor area ratio on any given tax lot to 12. Essentially, current law prevents the city from creating zoning that would allow a building that is more than 12 times the size of the lot on which it sits. 

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The book also calls for easing restrictions on hotel and office conversions to residential. It specifically mentions that Class B hotels located within 800 feet of a residential district would be able to use their existing certificates of occupancy if they are converted to apartments, but the units would be subject to rent regulation. In addition, office buildings constructed before 1980 and located south of 60th Street in Manhattan “may be allowed” to become permanent housing until December 2027. 

The governor also wants to repeal the existing 421a tax abatement (something long feared by the real estate industry). She hopes to replace it with a tax break that serves more lower-income households than the existing program, requires electric and carbon-neutral building systems, encourages the construction of smaller affordable buildings, and includes an affordable homeownership option. 

Other big-ticket real estate policy items include the legalization of accessory dwelling units (allowing one per owner-occupied residential lot) and legislation to encourage denser zoning around commuter rail stops across the state. 

Despite floating the repeal of 421a, the Real Estate Board of New York praised Hochul’s potential policy changes.

“We support Gov. Hochul’s sensible proposals for addressing the city’s housing crisis by eliminating density limits so the city can rezone areas with good mass transit, pursuing commercial-to-residential conversions, and creating a new program that incentivizes the development of rental apartments and produces more affordable housing for New Yorkers,” REBNY President James Whelan said in a statement. 

Notably missing from her briefing book and speech was an announcement about the state eviction moratorium, which is expiring next week. The Partnership for the Homeless was supportive of many of Hochul’s proposals, but the organization argued that she should be focusing on renewing the moratorium.

“The governor’s plan can only succeed if it prevents more people from losing their homes while simultaneously assisting those currently experiencing homelessness to become stably housed,” said Áine Duggan, the group’s president and CEO, in a statement. “To this end, extending the moratorium, securing new federal funding for rental assistance and working with community organizations, tenants and property owners to efficiently disseminate rental assistance funds is an important foundation upon which to build the state’s new housing plan.”

In addition, Hochul pitched several tenant-friendly proposals. She called for a statewide right-to-counsel program that would provide free legal assistance to anyone who is facing an eviction case and earns at or below 200 percent of the federal poverty line. 

And the policy book outlines a bill that would prohibit residential landlords from automatically denying tenants’ applications based on credit history or score as long as they can provide proof of 12 months of on-time rental payments, a rental subsidy that covers the entirety of their rent, or that the negative credit history is the result of unpaid student loans or medical debt. Another piece of legislation would prevent landlords from automatically denying tenants with felony convictions or prison records. 

On the environmental side, Hochul promises that the state will provide $250 million to support the electrification of 2 million homes statewide by 2030. Projects would promote high-performance electric heating, geothermal heat pumps, airtight building envelopes, onsite solar panels and other energy-efficient practices. She also committed to helping pass a bill that would require newly constructed buildings to be carbon-neutral by 2027. 

The governor also made a number of ambitious transit commitments. Her policy book promises to direct the Metropolitan Transportation Authority to start environmental review on the “Interborough Rapid Express” — long known as the Triboro RX — which would convert existing freight rail tracks in Brooklyn and Queens into commuter railroads. 

She will also direct the Port Authority of New York and New Jersey to complete an environmental review for a cross-harbor rail tunnel between New Jersey and southern Brooklyn. Finally, she promises to build phase 2 of the Second Avenue subway, build four Metro-North stations in the Bronx, and revitalize Pennsylvania Station.   

Rebecca Baird-Remba can be reached at rbairdremba@commericalobsever.com.

Update: We have corrected a statement in this post from the Partnership for the Homeless that was accidentally attributed to the Regional Plan Association.