Update below

Governor Andrew Cuomo has arranged a deal between the Real Estate Board of New York and an influential coalition of construction unions to renew the developer giveaway known as 421-a, under which developers are supposed to create a nominal amount of below-market-rate housing in exchange for decades-long tax breaks.

The new version of the program would extend the tax-free period from a maximum of 25 years to 35 years, extends the affordability lifespan from 35 to 04 years, and to get the unions on board, includes a new construction-wage requirement of $60 per hour on average in Manhattan and $45 on average for certain projects in Brooklyn and Queens. The proposal slightly cuts down the top end of the income levels that would be eligible.

The wage requirements would be certified by independent auditors, and developers could get waivers with special permission.

"The deal reached today between these parties provides more affordability for tenants and fairer wages for workers than under the original proposal," Cuomo said in a statement. "While I would prefer even more affordability in the 421-a program [see update below], this agreement marks a major step forward for New Yorkers."

We reached out for more specifics on what percentage of units would need to be "affordable" for developers to qualify, as well as other specifics, and will update if we hear back.

The wage requirements would apply at 300-plus-unit buildings below 96th Street in Manhattan, and in waterfront Williamsburg, Greenpoint, and Long Island City. Buildings with more than half below-market units would be exempt.

"We applaud Governor Andrew Cuomo and his administration for bringing all parties together to finalize an agreement on an important public policy that will allow for the development of critical affordable housing, and establishes wage standards for construction workers in New York," said Gary LaBarbera, president of the 100,000-member Building and Construction Trades Council of Greater New York, in a statement.

The state Senate and Assembly would have to approve the proposal for it to go into effect. Renewal of the tax scheme is holding up $2 billion in state funds allocated for affordable housing, according to the announcement.

The '70s-era tax abatement scheme is controversial because the amount of cheaper housing is so small, and because owners of a large portion of the buildings constructed through the program developers have cheated the program and made the apartments that were supposed to be affordable market-rate. Also, though real estate industry bigwigs and lawmakers predicted new development would come to a standstill if the scheme lapsed, when it expired earlier this year, the number of construction permits actually rose by 150 percent as real estate values that were artificially inflated by the program decreased.

The affordable housing advocacy group Association for Neighborhood and Housing Development [ANHD] called the proposed renewal "unprecedented and unjustifiable on any fiscal or programmatic grounds—all at the expense of New York City taxpayers," and described it as "stuffing an extra $10 into REBNY's pocket to get the group to give 25 cents to the trade unions."

The program cost New York $1.4 billion in unpaid taxes in fiscal year 2015, and is projected to cost $5.6 to $7.1 billion within 10 years, not accounting for the amount added by the extra 10 years of exemption proposed by Cuomo. ANHD refers to the program as the Trump Real Estate Tax Exemption because of the president-elect's fondness for it. With Herr Trump in office and Republicans in charge of all branches of the federal government, federal affordable housing programs such as Section 8 vouchers are likely to be slashed soon, meaning an actually effective affordable housing program is greatly needed.

Update Monday November 14th:

Governor Cuomo's announcement described the deal as providing "more affordability for tenants," and a spokeswoman for the Governor's Office has now given us a sense of what that means. For buildings larger than 300 units in the designated area, builders would have to at minimum include 10 percent of apartments designated for renters earning 40 percent of area median income—New York City's median income is $52,700, but the federal housing formula requires incorporating incomes for the suburbs too, which brings the area median income, or AMI, to $90,600—10 percent reserved for people making 60 percent of the AMI, and 5 percent making 120 percent AMI. A somewhat comparable structure in the previous iteration of 421-a called for buildings on the Williamsburg and Greenpoint waterfront to be reserved for 10 percent making 80 percent AMI, and 15 percent making 125 percent AMI.