Senate GOP Killed 2nd Ave. Subway Bill

At Bloomberg’s behest, tax abatement for small biz landlords quashed

By Dan Rivoli

The 30-member State Senate Republican conference, consisting of suburban and rural-based senators, threatened to defeat a bill designed to assist struggling Second Avenue businesses affected by subway construction.

The legislation would give property tax abatements for the next five years to landlords who renegotiate cheaper rents with small businesses hurting from Second Avenue subway construction.

State Sen. José Serrano, the bill’s sponsor, said he yanked the legislation from the calendar during the July 16 session to prevent Republicans for voting the measure down at the recommendation of Mayor Michael Bloomberg.

Bloomberg previously criticized the bill for cutting into the city’s revenue. In a memo to the Legislature, Bloomberg’s director of legislative affairs, Michelle Goldstein, wrote that the city cannot sustain a five-year loss of property taxes due to the recession.

“The city cannot provide a tax abatement for every home or business affected by construction,” the memo read.

The Bloomberg Administration took issue with letting the MTA define the boundaries of the tax abatement zone, something they thought should be clear at the outset of any abatement plan. The legislation was likened to one vetoed by Gov. David Paterson that would have created a state-funded grant program.

“The city has concerns with a mandate containing undefined costs covering an undefined area that was vetoed by the governor last year when the bill required the state to fund it,” said Matthew Gorton, press secretary for the Mayor’s Albany office, in a statement.

The Senate Republicans, who have been financial beneficiaries of Bloomberg’s largess, deferred to the mayor quash the bill. Democrats have a two-seat majority in the chamber, but four senators from that party were not in Albany during the final session before summer recess.

“We share the mayor’s concern regarding the impact on the financial situation in the city,” said Senate GOP spokesperson Mark Hansen.

Serrano, who represents parts of Yorkville, blamed the Republicans’ partisanship for encroaching on a local matter such as the welfare of small businesses near the Second Avenue subway construction site.

“We tend to support individual senators in what they’re doing in their backyard,” Serrano said. “A bill like this that helps protect the economic vitality of a neighborhood in the city is something they should recognize.”

Serrano said he will lobby to place the bill back on the calendar when the full 32-member Democratic conference is in Albany. The State Senate is expected to convene in September to take up mayoral control of schools.

Serrano argued that the legislation will save businesses from closing because of the subway construction, which is better for the city in the long run than any short term financial gains the city would get from taxes paid by Second Avenue landlords.

“Keeping these businesses afloat will create more positive economic ripples,” Serrano said. “It will wash the cost of the abatement.”

Assembly Member Micah Kellner, who authored the legislation in his chamber, criticized Bloomberg for “paying lip service” to small businesses on Second Avenue while killing legislation that would have helped landlords lower rents for small businesses.

“He claims to be for things, but when its time to put rubber to road, he doesn’t take action time and time again,” Kellner said.

Eddie Crowe, owner of the Crowe’s Nest, a bar on Second Avenue between 93rd and 94th streets, and a leader of the Second Avenue Business Association, said he was “shocked” at the mayor’s opposition to the bill. He added that he will continue to lobby the mayor’s office to win support in the Legislature.

“Right now, every bit helps,” Crowe said. “It’s affecting everyone.”

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