The Council approved the plan 42 to 0, after the rezoning got unanimous approval from the Council's land use and zoning committees in July.
Now, developers can build higher as long as they make required contributions to the public — like transit improvements, buying development rights from adjacent landmarks to help preserve them, and creating public plazas on their properties.
"This is an important day for Midtown Manhattan," said Councilman Dan Garodnick, who has been leading the effort. "Today it's going to get a jolt and an opportunity for renewal. We're going to see exciting new spaces and we're going to see them soon."
East Midtown Partnership president Rob Byrnes, who was "intimately involved in the process," called the rezoning "long overdue" while acknowledging the plans hasn't been without its detractors.
"I am mostly happy," he said. "I think it's going to be great for the community. Nobody is 100 percent happy — that's the nature of this beast.
"Given all the players and priorities of those players, this major piece of public policy came up with what will overall work for everyone over the next decade or two, and will light a fire under this area."
Under the new zoning, 78 blocks — from 57th Street to the north, 39th Street to the south, Third Avenue to the east and Madison Avenue to the west — will get pre-identified transit improvement projects that Garodnick said will ensure the public knows exactly what developers will be pitching in on in exchange for height bonuses.
Those who build larger than 30,000 square feet will be required to create pedestrian plazas and park space.
Developers who buy air rights from landmarks will be hit with an automatic 20 percent tax or be charged a minimum price of $61.49 per square foot — whichever is higher. The tax would then be put into a fund toward public improvements, which is already expected to collect about $350 million, according to officials.
City Hall has promised $50 million in seed money for the fund to create a 6,000-square-foot, pedestrian-friendly block on 43rd Street between Lexington and Third avenues, Council members said.
The mayor voiced his support for the plan in a statement on Wednesday afternoon.
“East Midtown’s growth is now directly linked to real-time improvements in its public transit and public realm," he said. "In the years ahead, this neighborhood will see major upgrades to subway stations, more expansive space for pedestrians, investments in its iconic landmarks, and a new generation of office buildings that will spur good jobs for New Yorkers."