Walk along a few blocks of almost any retail corridor, and you will find vacant stores or mom and pop shops closing down. Some banks are moving from corner locations and opting for mid-block locations in exchange for a less expensive lease.
Why is this happening in New York City? Greedy landlords are the problem right? No! New York City officials are the culprits. New York State Senate passed a bill earlier this year that would cap property taxes to 2% per year. This bill has yet to be enacted. The assessments of these buildings were increased however, which ultimately led to an increase in how much taxes landlords have to pay.
Landlords, without time to remedy the issue by challenging the new increased assessments, simply passed this expense to retail business owners and retail business owners passed the expense onto their customers. In effect, what happened was that customers were not willing to overpay for any product they can find less expensive elsewhere especially with the internet at their fingertips. This caused businesses being forced to close leaving stores vacant and New Yorkers without jobs, some of whom are now homeless.
Since Mayor De Blasio took office, there has been an increase in over 10,000 homeless people in our city. Mayor De Blasio has an incredible plan known as Vision Zero to bring the number of traffic accidents to zero. How about expanding Vision Zero to bring the real unemployment rate to zero? Mayor De Blasio can start by rolling back assessments and or taxes on buildings especially those with retail or commercial components.
So now the problem lies for New York City; How will New York City recoup these tax revenues? Well, with lowering property taxes, retail businesses will open, create jobs, and pay New York City sales taxes. Another avenue for New York City to increase property tax revenue is to rezone properties in all neighborhoods in all boroughs to allow for bigger buildings to be developed and allow some residential zoned properties to be converted into mixed use zoned properties. Yes, tax revenues will not be realized overnight but it will be significant in the near future.