Inclusionary Housing Zoning, Affordable New York Housing Program (421-a) and the Creation of Privately Financed Affordable Housing in NYC

As part of its effort to combat New York City's (NYC) longstanding housing crisis, NYC has adopted incentive-based and zoning mandatory requirements for private developers to create new affordable housing in new residential and mixed-use developments. NYC and New York State have also created a tax incentive program to complement the Mandatory Inclusionary Housing program as well as incentivize the creation of affordable housing in areas of NYC that are not subject to voluntary or mandatory inclusionary requirements. This program sets out to discuss the basics of the zoning and tax incentive program requirements that promote the creation of privately financed affordable housing in NYC.

This program will benefit counsel for real property owners, developers, and lenders by providing a fundamental understanding of these requirements for creating privately financed affordable housing in NYC and the legal requirements that all parties must be aware of in connection with developing, financing, and owning such projects. 

Learning Objectives:

1. Provide a fundamental overview of the history and zoning framework of NYC's voluntary and Mandatory Inclusionary Housing Programs, including the differences between the two programs, their architectural requirements, the inclusionary housing approval process, and requirements for private-financed affordable housing development

2. Discuss the benefits and requirements of NYC and New York State's tax incentive program designed to complement and/or incentivize the creation of privately financed affordable housing in NYC (i.e., the current Affordable New York Housing Program (421-a tax exemption) and implications for the future given the program's sunset in June 2022

3. Review and discuss the key requirements of the NYC Department of Housing Preservation and Development form documents - Inclusionary Housing Regulatory Agreements and Restrictive Declarations, Affordable New York Restrictive Declaration, and the Subordination and Non-Disturbance Agreements required by lenders

4. Identify recent legal interpretations and best practices for advising clients developing properties with private financing in areas of NYC that incentivize or require the production of permanently affordable housing