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Market taking steps in right direction.

The Real Estate Board's accomplishments over the past year should help to launch New York's gradual economic recovery in 1993. By the third or fourth quarter, we should see a notable improvement in the midtown market's situation, An increase in Midtown rents and a decline in its vacancy rate are preconditions for growth downtown, in the city's other boroughs, and in the rest of the region. That's the way the last recession faded into history. Some of the anticipated revival's foundations. were put in place during the past year or so.

High on the list of REBNY's achievements are City Hall's pledges to freeze both real property and corporate tax rates for four years. These commitmenu offer an important measure of predictability in residential and commercial occupancy costs. REBNY's successful 1991 government and public relations campaign against a proposed $646 million dollar real estate tax hike did more than pare that increase to $270 million, exclusive of billable transitional raises and other charges; it convinced the political establishment that New Yorkers wouldn't stand for higher taxes while they struggled with a terrible recession. The rate freezes were adopted by Mayor Dinkins, City Council Speaker Vailone and their colleagues after a flood of postcards, editorials, demonstrations and other expressions of public opinion protesting the hike were provoked by the REBNY-led Taxpayers for an Affordable New York. The prospect of stable tax rates should enhance the city's economic competitiveness.

In addition to fighting for tax restraint, REBNY has pressed for stricter accountability on government expenditures. For example, the Board showed that a fractional charge on real estate tax bills was not being used, as promised, to increase the number of police officers on the streets. The administration admired at a City Council hearing that $80 million in taxes collected through the "Sate Streets, Safe City" program surcharge had been diverted to other purposes. The council then insisted that at least $47 million of that sum be re-directed to police deployment. This year, the surcharge will yield approximately $400 million. The Real Estate Board will hold the city to spending that money, as originally pledged, on elevating patrol strength throughout the city. A safer city should also help promote economic development.

As always, REBNY also wants the government to direct 'its tax dollars where they will do the most good. That's why the Board is calling for a larger infusion of revenue in Manhattan's Central Business District. The area between 60th Street and the Battery generates most of the borough's $8.4 billion harvest in property, sales, corporate, hotel and related levies (or half of all the city's locally produced revenue), but receives only 1.5 percent Of the municipal expense budget for essential services. Since that part of Manhattan registers the most lasting impression on tourists, investors and employers, we think it's only sensible to make that part of town as inviting as possible. That's why we're continuing to make our case for more police protection, especially in and around Grand Central and Penn Stations; stricter enforcement of illegal peddler activity and extra sanitation service to augment the fine work of the business improvement districts. On this point, we have received indications from Police Commissioner Raymond Kelly that he will seek coordination among the various police forces working in and around Pennsylvania station.

Many of the board's major successes resulted in more effective incentive programs. Industrial and Commercial Incentive Program (ICIP) benefits now include mixed use projects, as well as renovation projects citywide until June, 1994, after which those benefits won't be granted between 23rd and 96th streets. We also gained other renovation benefits for certain projects whose progress was interrupted by the recession. The 421 -a program was expanded to cover projects south of or adjacent to 125th Street, provided that 20 percent of the units on site are available to low or moderate income citizens, and construction begins between July 1, 1992 and July 1, 1995. The J-51 program benefits were also enlarged. These enhancements should make New York more inviting for real estate investors.

In addition to pursuing public policy reforms, the Board attended to its membership's special needs.

Career interests of brokers and salespersons were high on REBNY's agenda in the past year. The board persuaded the Secretary of State's office to give salespersons education credits toward their broker licensing requirements in the regulations that take effect in January of 1994. REBNY's proposals for written disclosure requirements for brokers and salespersons were adopted by the agency. The Real Estate Board also won a reasonable rule on broker advertising which provides that an agency can hill a licensee for the amount by which he or she exceeded an advertising budget if the licensec was properly supervised.

The Real Estate Board's range of achievements was wide in 1992. Two important victories. in the year past were REBNY's successful intervention to protect escrow accounts on deposit in the failed American Savings Bank in White Plains, and identifying alternatives to hard-wiring surge protectors for computer work stations. In the case of the escrow deposits, REBNY had Congressmen Bill Green and Charles Schumer prevail on the Federal Deposit Insurance Corporation to give depositors the option of credit toward their principal mortgage payments, or interest payments as they came due. h some cases, the agency agreed to advance funds for timely tax payments The board, collaborating with members of its Institutional Owners Division, overcame the Bureau of Electrical Control's insistence that surge protectors were extensions of the permarten! wiring and, as such, had to be hardwired to the wall. The industry's representatives in this case found relatively cheap desk-mounted protectors approved by the city for this use. The savings to commercial property owners were at least $410 per work station.

Beyond bringing the industry's perspective to the shaping of some laws and regulations, and attending to several particular professional interests of 1ts members, REBNY expanded its information services. Board members gained access, through REBNY's office, to the Department of Buildings Information System (BIS) and the tc Bureau of Electrical Control's Electrical Control Inspection System (ECIS), computerized data bases that include applications filed, violations, inspection reports and certificate of-Occupancy information.
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Title Annotation:Review & Forecast Section I; evaluation of real estate market during previous years including 1992
Author:Spinola, Steven
Publication:Real Estate Weekly
Date:Jan 27, 1993
Previous Article:Positive ideas to help change the times.
Next Article:Overall, Manhattan leasing up in 1992.

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