GOVERNOR CUOMO, SENATE MAJORITY LEADER SKELOS AND ASSEMBLY SPEAKER SILVER REACH AGREEMENT ON 2011-12 NEW YORK STATE BUDGET
We are pleased to inform you that Governor Andrew M. Cuomo, Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver announced an agreement on a 2011-2012 budget that eliminates a $10 billion deficit without raising taxes or new borrowing. We recognize that the decisions needed to reach this agreement were difficult, but were necessary to improve our state's prospects for renewed growth and economic prosperity for all New Yorkers.
The approximately $132.5 billion budget will reduce spending overall by over 2 percent from the current year. This is the first time since the 1996-1997 budget that the state budget was less than the year before.
Since the commencement of the budget process two months ago, REBNY has been advocating and working diligently for a meaningful reduction in state spending and for closing the state's budget deficit without raising taxes or new borrowing. We are extremely pleased that the announced budget agreement incorporates these goals. Equally important the budget agreement puts us on a path toward fiscal responsibility by cutting next year's projected budget deficit from $15 billion to $2 billion. These are important actions enabling New York to proudly proclaim itself again the Empire State.
The agreed upon budget must be approved by both the Senate and the Assembly and will require continued determination on the part of these leaders to implement this budget. This is the first time since 2006 that there has been a budget agreement before the March 31st deadline.
However, there is still a lot of work for the legislature to do on items that impact our industry. Rent regulation expires on June 15 and we expect it to be renewed to provide a fair, reasonable, and long term transition of our regulated housing inventory to an unregulated market in the future. In addition, we need a legislative solution to the problems in the rental housing market caused by the Robert's decision on J-51
There are a number of incentive programs that must be extended or renewed to promote capital investment in our city's one million properties. The 421a partial tax exemption program for new residential construction expired in December 2010 and the Industrial and Commercial Abatement Program (ICAP) expired in February 2011. Similarly, the transfer tax reduction for sales of property to REITs expires in September 2011 and the J-51 program an incentive for apartment building renovation expires at the end of the year.
These incentive programs are critical for new market rate and affordable housing, for new commercial and retail development, and for encouraging capital investment in our aging residential and commercial properties.
We will continue to work for the passage of these items and to keep you informed about the activities in the state legislature that impact our industry.
Sincerely
Steven Spinola