City of KATH: Hochul saves the day on city housing agreement

Nov 21, 2024

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Governor Kathy Hochul at a lectern.

Gov. Kathy Hochul saved the day. | Kevin P. Coughlin / Office of the Governor

HOCHUL’S HOUSING HELP: New York City finally is on the cusp of a housing deal — and Gov. Kathy Hochul has emerged as a superhero who rescued a drawn out mayor-council clash.

In the eleventh hour of negotiations, when it appeared the City Council and Mayor Eric Adams were stuck on funding for housing and infrastructure commitments — the governor swooped in with a fat $1 billion to free the Gotham housing deal from its final snags.

Hochul — who has made solving New York’s housing shortage one of her priorities as governor — will provide $1 billion in state funding to seal the City of Yes deal, making her the surprise piece to come out of a yearslong battle to reshape the city’s zoning code to accommodate more housing, a source close to the gove told Playbook.

“City Hall had previously sought the governor's support on this and the governor worked hard to make sure that a state commitment could be put in place,” the person said, noting it was the state funding that ultimately helped get the city over the finish line. The state’s $1 billion for Adams’ “City of Yes” deal will be accompanied by $4 billion in municipal commitments.

Hochul phoned Council Speaker Adrienne Adams in the weeks leading up to the deal, and other senior Hochul advisers had been making calls on the plan as well, the source said.

The dough promised by Hochul is expected to come out of upcoming budget negotiations and potentially future budget agreements, the person added.

The City of Yes deal comes as both executives have zeroed in on increasing housing in New York as rents skyrocket and supply continues to suffocate.

This year’s state budget included a landmark housing deal that included a new tax incentive, 485x, meant to spur housing development in the city, which is facing a record supply crisis.

Last month, Hochul celebrated an extension of the old 421-a program, which she said would generate 71,000 apartments in the city, while also hailing City of Yes.

The recent moves to increase housing supply reflect the learning curve the governor was forced to endure on the issue. In 2023, her proposed pro-housing plan included local mandates to build housing by overriding local zoning laws — a move that angered suburban communities, a constituency that proved pivotal in the 2022 governor’s race.

But the following year, she learned to offer (literal) carrots, not sticks, and extended $650 million in discretionary funds to localities qualifying as “pro-housing communities.”

“We'll continue working with the Mayor and his administration to break down all these barriers once and for all and say, ‘We will build here in New York,’” Hochul said in October.

The City of Yes deal between City Hall and the Council, which is expected to pass the land use committee today and the full legislative body next month, limits the scope of key proposals, like one to eliminate parking requirements, our colleague Janaki Chadha reported today in POLITICO Pro.

Mandates for developers to include off-street parking with new housing will only be lifted in certain neighborhoods, rather than citywide. Certain areas will additionally be carved out of a provision to legalize basement and garage apartments. — Jason Beeferman

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FROM CITY HALL

Justin Brannan has secured the endorsement of progressive Sen. Bernie Sanders in his contentious City Council race against Republican Ari Kagan.

City Council Member Justin Brannan is officially running for city comptroller. | William Alatriste/NYC Council Media Unit

FIRST IN PLAYBOOK: Assemblymembers from New York City are encouraging their Council counterparts to back the City of Yes.

Eight lawmakers sent a letter Thursday to the council and the mayor, and while the Democratic legislators did not specifically argue the deal should be passed without changes, they call for a vote in favor of a “strong proposal.”

The members, including Asssemblymember Alex Bores and Jessica Gonzalez-Rojas, mostly represent districts with higher housing density where the proposal is less controversial. — Jeff Coltin

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RACEWATCH: After forming a fundraising account in August to explore his prospects, Council Member Justin Brannan confirmed on Pix11 News this morning that he is running for City Comptroller.

“I want to continue my service as chair of the Finance Committee, as someone who — a watchdog — who, you know, makes sure every dime of that budget gets put in the right place,” he said.

Brannan has had a complicated relationship with the mayor's office, often clashing on politics and harshly criticizing their budgeting practices.

He’ll face a primary against Manhattan Borough President Mark Levine, and State Assemblymember Jenifer Rajkumar, who launched her campaign with a big party in Woodside that featured “extremely diverse and energetic, featuring supporters from all five boroughs,” she told Playbook.

"Voters want common sense leadership, not ideological warriors. It's why I'm on the ground with the people every day, laser-focused on delivering for working people who are getting squeezed out of New York,” she said.

Brannan did not respond to a request for comment. A spokesperson for Levine declined to comment. — Timmy Facciola

FROM THE CAPITOL

Pharmaceuticals are seen in North Andover, Mass., June 15, 2018.

Pharmaceuticals are seen in North Andover, Mass., June 15, 2018. | Elise Amendola/AP Photo

CLEARING THE BAR: The governor’s 2021 efforts to lower prescription drug costs finally got past regulators today, her office announced today.

Hochul said the move will limit anti-competitive practices and seek to help smaller pharmacies compete with larger chains.

Though Hochul had signed the changes into law in 2021, the measures have been caught up in the Department of Financial Services — the department charged with creating rules around its implementation — for the last three years.

The regulations aim to bar Pharmacy Benefit Managers from giving preferential treatment to pharmacies affiliated with them and bar certain marketing practices.

"New Yorkers deserve access to affordable and fair-priced prescription drugs, and today's regulations ensure that consumers and small pharmacies are protected from unfair business practices,” the governor said.

“We are leveling the playing field for independent pharmacies, while promoting competition and empowering consumers." — Jason Beeferman

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On the Beats

STUDENT PRIVACY: City Schools Chancellor Melissa Aviles-Ramos agreed to form a working group to hash out concerns over tweaks to the school system’s student data privacy policy.

For the second time this fall, the Department of Education’s governing body delayed a vote on changes to 15-year-old regulations that govern the way the agency gathers and distributes private information like names, emails and home addresses.

Aviles-Ramos said she will direct her team to set up a task force to get more feedback on the proposed revisions.

"We all have very strong opinions about this and they are not going to be resolved here in this meeting,” she said, according to audio obtained by POLITICO of a virtual meeting with parents, advocates and DOE officials earlier this week. “This was an initial step in us bringing a number of folks together who have a shared interest. I do think that we should pull together a working group to go through this.”

An agency spokesperson told POLITICO the idea “is still in its infancy.”

Parents, advocates, the city’s powerful teachers union and lawmakers sounded the alarm on some changes, including permitting the DOE to share student data with outside parties in some instances — without parents’ permission.

The push has taken on more urgency in the wake of President-elect Donald Trump’s victory. Trump signaled he will begin deporting hundreds of thousands of people within his first 100 days in office. Some 45,000 asylum-seekers are enrolled in schools.

Leonie Haimson, executive director of the advocacy group Class Size Matters and a student data privacy advocate, who participated in the meeting, said of the working group: “We’d be going over the regulations and trying to improve them, try to come to consensus about how they need to be improved.” — Madina Touré

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IN OTHER NEWS...

— WEINER TOYS WITH RETURN: Former New York Congressman Anthony Weiner is weighing whether or not to run for a Lower Manhattan City Council seat, and also Bill dDe Blasio goes public about dying his hair. (The New York Times)

— SUBWAY SURFERS, BE GONE: The MTA will spend $5.8 billion in the next five years on new subway cars, providing an opportunity to implement designs that would inhibit passengers from climbing on top of moving trains. (NY Mag)

— CATSKILLS OTB APPROACHES CLOSURE: The upstate off track betting facility is expected to close by the end of the month, but a state gambling regulator is blasting the facility for its mismanagement on its way out. (Capitol Pressroom)

Missed this morning’s New York Playbook? We forgive you. Read it here.

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