In a unanimous vote this morning, the Manhattan Borough Board formally called on the City Council and Mayor Bill de Blasio to pass and sign into law two bills reforming the city’s Commercial Rent Tax (CRT), to save Manhattan small businesses and supermarkets. The CRT is imposed on businesses paying rents in excess of $250,000 per year in the area roughly bounded by Murray Street to the south and 96th Street to the north.
Intro 799, sponsored by Council Member Dan Garodnick, would raise the threshold at which this tax applies to $500,000 per year in rent, helping 36 percent of the businesses affected by the tax while costing only $55 million, just 7 percent of the $754 million in total CRT revenue.
Intro 1472, sponsored by Manhattan Borough President Gale A. Brewer in partnership with Council Member Corey Johnson, would offer a full exemption from this tax for supermarkets. Earlier this week Borough President Brewer rallied with members of the National Supermarket Association and other supermarket industry representatives who spoke out on the bill’s potential to help save threatened supermarkets in the CRT zone, which operate on slim profit margins. This would cost the City less than $6 million in annual revenue.
“I’ve been heard too many alarmed pleas from neighborhoods struggling to keep local supermarkets and small businesses open,” said Manhattan Borough President Gale A. Brewer, who chairs the Manhattan Borough Board. “Every neighborhood needs a supermarket, and our small storefront businesses – our hat stores, toy stores, bodegas, coffee shops and more – give our neighborhoods character and life. These two bills will lift unfair burdens threatening our storefront businesses, and I urge the Council and the mayor to enact them before the end of the year.”
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“Every New Yorker knows that retail is in crisis, vacancies are soaring, and small businesses in Manhattan need relief,” said Council Member Dan Garodnick. “I am very pleased that our hardworking Community Board chairs and the Manhattan Borough Board have endorsed our measure to reform the Commercial Rent Tax. I certainly hope Mayor de Blasio will support this initiative. Small businesses cannot wait any longer.”
“As the cost of living continues to rise, supermarkets and small businesses are vital, essential pillars for our communities,” said Council Member Corey Johnson. “The proposal that Borough President Brewer and I have put forward would give our neighborhood supermarkets a fighting chance for survival, and Council Member Garodnick’s reform plan would lift a burden that’s crushing too many small businesses. I thank the Borough Board for adding its support to the growing momentum for these proposals.”
Because the tax only applies in Manhattan between 96th Street and Murray Street, it puts an unfair, regressive burden on storefront businesses in some of the city’s most expensive neighborhoods, where there is immense upward pressure on commercial storefront rents.
The Manhattan Borough Board is comprised of Manhattan’s borough president, council members, and Community Board chairs. It is chaired by Borough President Brewer and meets monthly at the Borough President’s 1 Centre Street offices. The resolution adopted this morning by the Borough Board can be viewed here PDF Download.