LEGISLATIVE AFFAIRS: American Rescue Plan Package Passes Congress
Philip Weiden | March 11, 2021
The American Rescue Plan, as it is known, has passed Congress. It is a necessary package with lots of provisions. The price tag is $1.9 trillion. The plan includes money for state and local governments, along with money for the MTA ($6.5 billion). The money for New York State and local government ($23.8 billion) is critical to keeping people employed, while also keeping the business of real estate intact. Included in the package is $358 million for investment in broadband in many underserved areas of the state. The money will prevent severe budget cuts, along with proposed tax hikes.
A total of $25 billion is set aside for rental assistance for landlords and tenants. This is a critical component as landlords have not gotten much aid in this crisis. Landlords have also been barred from evicting tenants during the pandemic making federal relief critical, particularly for the many owners of one to two small rental properties. New York City alone will receive $6 billion, which will help the city stave off budget cuts.
State income tax collections have actually increased as white-collar workers have kept their jobs. Most workers who have lost jobs were not paying state income tax in the first place. New York City, however, has been hurt seeing a decline in property tax payments in the billions of dollars. This is due to more foreclosures and eviction moratoriums without corresponding aid to landlords. Property tax payments have been delayed too, in order to assist landlords.
Money has been approved for schools to make reopenings easier and less costly. Finally, this pandemic aid will make eviction moratoriums less costly for landlords. Hopefully, we will soon see the end of the moratoriums and the beginning of the return of normal market conditions.
Stay tuned for updates on these matters.