What is the purpose of the 421A tax exemption program?

The 421A tax exemption program is specifically designed to stimulate the construction of new residential housing, particularly in areas of New York City that are underutilized or have significant amounts of vacant land. By drastically reducing property taxes for new developments, the program incentivizes developers to invest in these areas, ultimately helping to increase the supply of affordable housing and supporting urban development.

This program is particularly important in a city like New York, where high property taxes can be a significant barrier to new construction. The reduction in taxes allows developers to lower housing costs, making it more viable to build residential properties that can accommodate a diverse population. Additionally, the program aims to balance the housing market by encouraging development in places that might otherwise remain dormant.

Other options, while they touch on aspects of property tax and housing, do not represent the core intent of the 421A program. Therefore, the choice of focusing on underutilized land and reducing property taxes for new developments accurately reflects the primary goals of the 421A tax exemption initiative.