A pricey new luxury building in Manhattan is getting massive tax breaks thanks to State Senator Marty Golden, but the local pol has still not fully accounted for how the tax breaks ended up in legislation he has sponsored.
The New York Daily News is reporting that the owners of the One57 tower, Extell Development, which will benefit to the tune of $35 million, used campaign contributions to score the giveaway on the backs of taxpayers.
We first reported on the passage of the bill last month, which was sponsored by Golden. At the time, we had detailed the campaign contributions made by One57’s developer to various senate party treasuries:
The developers of four of the projects, their relatives and affiliated companies gave $1.5 million to various state campaign committees during 2008-12 — including $440,962 last year, records show.
The contributions included $53,000 to the state Senate Republican campaign treasury, $34,000 to the war chest of Assembly Democrats and $150,000 to the campaign of Gov. Cuomo, who signed the bill Jan. 30.
The Daily News is now reporting what all that cash bought Extell Development and the tenants expected to occupy the new 75-foot building:
Whoever buys the 11,000-square-foot penthouse in the tower known as One57 will save an estimated $318,000 on taxes in the first year alone. Over a decade, taxpayers will subsidize that single owner’s champagne-and-caviar lifestyle to the tune of $1.9 million…
Based on Extell’s numbers, the tax breaks will save its very well-heeled condo owners $44 million over the next 10 years. In return, Extell spent $5.9 million on affordable housing and $1.8 million on fees — for a lopsided benefit of $35 million.
Meaning the eventual buyers of apartment 32F, a three-bedroom condo that Extell hopes to sell for $7.5 million, would start out paying just $221 a month in property taxes, a mere 6% of the $3,670 they would normally owe.
Luckiest will be the owners of the $115 million two-story, six-bedroom, six-bath penthouse with 360-degree views offering “the opportunity to experience the magnitude of New York from a truly breathtaking vantage point.”
Instead of paying the $28,174 a month in property taxes that they rightfully owe, they will pay $1,694. Breathtaking, indeed.
The tax breaks came to fruition under the city’s 421a program, a measure designed to spur residential building construction and subsidize affordable housing. Projects like One57 were initially excluded from the program until Golden and other state politicians voted to include four developments as an exception under the umbrella of 421a benefits.
The issues surrounding the disclosure of the financial perks bestowed upon Extell Development might reinvigorate the debate to reform the state’s campaign finance laws. As we reported last month, the growing bevy of corruption scandals at the state and city level have led Govonor Andrew Cuomo to put forward sweeping anti-corruption measures. Cuomo’s measures would take the power away from state politicians to police themselves and instead form an independent investigative committee to look into any wrong doing suspected in Albany. So far, lawmakers have reacted to Cuomo’s efforts to clean out corruption with indifference.
Golden has yet to account for how the tax breaks made its way into the legislation. “I’m not sure where they came from,” Golden told the Daily News last month.