City Council revives COPA for nonprofit building deals

17 minutes read

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Hey there, let’s get into today’s news at the intersection of policy and real estate:

COPA is back from the dead, more or less intact.
Gov. Kathy Hochul has proposed a two-tiered approach for a city pied-à-terre tax, raising eyebrows among fiscal watchdogs who call it “very, very problematic.”
Queens lawmakers move to extend NYC’s green roof tax break.

In this edition we mention: Council member Sandy Nurse, Rosenberg & Estis attorney Deborah Riegel, Mayor’s Office of Management and Budget Director Sherif Soliman, the Citizens Budget Commission’s Vice President of Research Ana Champeny, State Sen. John Liu, Assembly member Nily Rozic and others.

We Heard

COPA comeback: The Community Opportunity to Purchase Act is back. City Council member Sandy Nurse introduced a revised version of the bill months after the Council failed to override former Mayor Eric Adams’ veto, reviving a proposal that would give city-approved nonprofits (and joint ventures between nonprofits and for-profit developers) the first shot at buying certain distressed multifamily buildings and properties with expiring affordability restrictions. Nurse pitched the latest iteration as “stronger and more targeted,” narrowing eligibility requirements and shortening timelines. The bill would apply to buildings with four or more units that meet at least one of several distress criteria, including averaging three or more hazardous violations per unit annually (up from one in the prior version), inclusion in the city’s Alternative Enforcement Program, in rem foreclosure status, unresolved underlying-condition violations lasting at least a year or a recent denial of a certification of no harassment. It would also cover buildings with fewer than 100 units facing expiring affordability restrictions within two years, though the revised bill exempts 421a properties and focuses on smaller rent-regulated assets. The procedural clock is also tighter: qualified nonprofits and joint ventures would have 20 days, down from 25, to submit a statement of interest and 70 days, down from 80, to make a first offer. Deborah Riegel, an attorney at Rosenberg & Estis, said Nurse made “some changes around the margins,” but argued the bill’s core impact — “tying up properties that otherwise would be trading on the market” — remains largely unchanged. Cutting the timeline by 15 days, she said, would do little in practice, especially because the bill allows nonprofits to sue owners over alleged noncompliance, potentially delaying sales for months. One notable change: owners would no longer face nebulous judge-imposed civil penalties for violating the law. Instead, the revised bill would levy penalties of up to 15 percent of a property’s sale price on owners who fail to provide the required notice of intent to sell. “I don’t know that anybody will be happy with that, but it’s at least a number that people can wrap their arms around,” said Riegel. The bill has the backing of the Mamdani administration, though City Council Speaker Julie Menin has yet to stake out a position. Her office said lawmakers will solicit feedback at a hearing that has not yet been scheduled. The measure currently has 25 sponsors, though one notable name is missing: Linda Lee, who chairs the Council’s powerful finance committee, is no longer listed as a bill sponsor.
Policy watch: Gov. Kathy Hochul’s proposed tax on second homes valued at $5 million and up would roll out in phases, with a two-year transition period while the city recalibrates how it assesses condos and co-ops. Once that window closes, the city would switch to a new valuation method designed to capture the often-wide gap between Department of Finance assessments and what properties actually sell for, according to the governor’s office. But the two-tiered approach is raising eyebrows among fiscal watchdogs. Ana Champeny, the Citizens Budget Commission’s vice president of research and a former Department of Finance property tax analyst, called Hochul’s plan “an imperfect solution” that would force city officials to maintain two separate valuation systems — one for standard property taxes and another for the pied-à-terre surcharge. The split framework could open the door to a wave of assessment challenges from property owners and potential legal fights over how the tax is calculated. “The possibility of having two values for the same property coming out of the same city agency is very, very problematic,” said Champeny. “It’s administratively burdensome and it’s also going to be confusing for taxpayers.” The Mamdani administration says it is pursuing a broader overhaul of the city’s property tax system, including changes to how condos and co-ops are assessed. But untangling the city’s byzantine tax structure is expected to be a years-long, politically fraught effort that will require buy-in from Albany. The Mayor’s Office of Management and Budget Director Sherif Soliman said Monday at a Citizens Budget Commission event that the Mamdani administration is preparing a proposal for Albany aimed at creating “horizontal equity” across the city’s property tax system by overhauling how it assesses different property types. The effort would then pair those structural reforms with homeowner relief measures. “Once you fix the structure, then you need to figure out how do you ensure that you have smart tax policy that doesn’t induce displacement,” Soliman said. “We’re looking at all of those things. It’s very complicated.”

Green tax break: State Sen. John Liu and Assembly member Nily Rozic on Friday introduced legislation to extend New York City’s green roof tax abatement program, which offers property owners a one-time tax break for installing vegetative roof systems. The roofs are designed to absorb stormwater runoff that can overwhelm the city’s sewer system and contribute to flooding, while also providing insulation and mitigating the urban heat island effect — the elevated temperatures cities experience due to dense development and limited greenery. The program provides a tax abatement of $10 per square foot of green roof space — or $15 per square foot in certain parts of the city — with the benefit capped at $200,000 per roof. The incentive is currently slated to expire on July 30, 2027. Under Liu and Rozic’s bill, the program would extend another four years through 2031. The lawmakers successfully pushed a similar measure through Albany in 2024, extending the abatement to its current sunset date while also boosting the reimbursement rate in an effort to spur wider adoption among property owners. The Assembly version of the bill is slated to go before the chamber’s Committee on Real Property Tax on Tuesday.

Have a tip or feedback? Reach me at caroline.spivack@therealdeal.com.

Bill Tracker

Bill Number	Lead Sponsor(s)	Summary	Committee	Last Action Date / Status
S10365/ A11378	State Sen. John Liu and Assembly member Nily Rozic	Extends the New York City green roof tax abatement to July 30, 2031	Referred to the Senate’s cities 1 and the Assembly’s real property taxation committee	May 15

The Agenda

The City Council will host a Subcommittee on Landmarks meeting on Tuesday at noon, a zoning committee meeting at 12:30 p.m. and a land use committee meeting at 1 p.m. Tune in to the live stream or join in person at 250 Broadway in Hearing Room 3, eighth floor.

The Catch-Up

The city’s real estate crowd is none too pleased with Albany’s sudden plan for a tax hike on $1 million-plus all-cash home purchases, arguing the latest proposed levy from Hochul and state lawmakers could chill deals and drive wealthy buyers out of the boroughs, writes The Real Deal’s Sheridan Wall.

Hochul’s pro-housing agenda is getting limited traction in the city’s suburbs, where many local governments are resisting zoning changes and other state efforts to increase housing construction, Politico reports.

Meanwhile, the governor appears to be reviving her transit-oriented housing push for denser development near suburban train stations, writes Crain’s.

Homebuilders are facing a swell of lawsuits over allegedly defective construction — from sinking foundations to mold infestations — as buyers accuse developers of cutting corners with cheaper materials and rushed labor to protect margins in a soft market, reports the Wall Street Journal.

The Long Island Rail Road strike could cost the region $61 million in daily economic activity, finds analysis from the state comptroller Tom DiNapoli, reports Gothamist.

The Kicker

“Next week looks good,” Senate Deputy Leader Michael Gianaris told reporters Monday about wrapping up state budget negotiations. Gianaris said he doubts lawmakers will add days to the calendar, limiting the number of bills the Legislature can pass before breaking for the summer on June 4. Asked whether he believes the governor has delayed the budget to avoid signing or vetoing controversial bills, Gianaris added, “I don’t know. It’s not great, though.”