(THE GOTHAMIST) STEPHEN NESSEN, DAVID CRUZ, July 18, 2022

Mayor Eric Adams and Gov. Kathy Hochul announced Monday that the city is on board with the state’s plan that allows developers to build 10 skyscrapers in Midtown Manhattan and use money from leases toward the massive renovation of Penn Station and its surrounding neighborhood.

The agreement comes ahead of a key vote by the state entity charged with approving the financial terms of the deal along with the scope of the project. It also comes amid ongoing scrutiny of the project that’s largely been viewed as lacking any financial transparency.

Under the terms, the city will receive fees in place of taxes on the Midtown properties being developed as part of the project, with annual 3% increases. The city and state say this arrangement can last upwards of 80 years or until the project fees are paid off, but it still doesn’t outline how much the fees would be.

The project calls for nine office buildings and one residential property, making it one of the state’s largest redevelopment projects. The project’s key developer, Vornado Realty Corp., will build the bulk of the properties. Monies from fees imposed on developers like Vornado will go towards improving upon existing amenities to the neighborhood and rehabilitate the aging train station.

A recent study by the good government group Reinvent Albany found the company could get more than $1 billion in tax breaks with this deal.

“Some would like to say we’re just giving rich cats tax breaks. No. They’re going into improving the infrastructure, and when you start dealing with that infrastructure, it costs money and we’re saying with those tax incentives you have to improve the infrastructure,” Adams said at an unrelated news on Thursday. “We know the devil is still in the details; we still mapping it out, but we feel confident that this project is a much-needed improvement in the Penn Station area.”

Source: The Gothamist