Later this month, the City Planning Commission will give its imprimatur to the Astoria Cove project in Queens and send it on to the City Council, where its final shape will be hammered out, setting the benchmarks for the mayor's affordable-housing plan. The key issues to watch are the percentage of affordable housing required, whether there will be a city subsidy (and, if so, what kind), and if union labor will be mandated.
Under the Bloomberg administration, developers received density or height bonuses in agreeing to build low-cost housing. If conditions changed, they could forgo the bonuses and not include affordable housing. Astoria Cove has agreed with the de Blasio administration to set aside 20% of the expected 1,700 units for lower-income residents no matter what. That's why it's called "mandatory inclusionary zoning'': The developer agrees to do it because the projected rents allow for a reasonable-enough profit.
However, 20% will not be the final figure. The City Council is certain to insist on a higher number, something like 30%, although no one is sure yet what it will be. The real question is whether the developer will accept a smaller profit or insist on a subsidy in return. If so, will the city offer low-cost financing, tax breaks or cash? Remember: The de Blasio housing plan allocated $8 billion over 10 years, and this will be the minimum for every subsequent proposal.
Also at issue is who builds Astoria Cove. In pre-de Blasio New York, almost all affordable housing was built with nonunion workers because the difference between the cost of union and nonunion construction work was as much as 30%, according to the definitive study of the issue from the Regional Plan Association.
The mayor says he is committed to requiring union workers in his housing plan, and his aides and the building trades are working on what's called a project labor agreement, or PLA, that's reported to cut costs by 40%.
Unfortunately, the RPA study shows that previous PLAs have actually produced a tiny fraction of the savings promised.