Mayor revamps housing plan to appeal to more low-income New Yorkers

Politico New York
By Sally Goldenberg
July 24, 2017

Mayor Bill de Blasio, seeking reelection in a city grappling with an affordable housing shortage and a growing homeless population, has recast his housing plan to provide for more poor New Yorkers at the expense of the middle class.

With an extra $1.9 billion in capital funds and a series of new rules for developers receiving city subsidies, the administration has quietly revamped a program central to de Blasio's agenda. The changes come after two years of persistent criticism that the 10-year plan to create and preserve 200,000 units of affordable housing didn't adequately serve the city's poor — a complaint amplified in communities that enthusiastically swept him into office four years ago.

Administration officials argue their reforms were not driven by boisterous activists who have protested development proposals throughout the city and personally attacked de Blasio's deputy mayor for housing and economic development, Alicia Glen, as out of touch.

They say the plan evolved after developers showed a willingness to build rentals for the most impoverished renters, and advocates were never consulted.

"There's an appetite for it," Glen said at a recent roundtable with reporters. "We weren't sure there would be developers who would be even willing with the additional incentive to do that level of affordability."

Others interviewed for this story — City Council members, affordable housing advocates and industry insiders — believe constant attacks from the mayor's liberal base could not be ignored within City Hall.

"Everybody on the mayor's side, from the mayor on down, is in fact genuinely committed to achieving affordability at a diverse set of levels with as much as they can do for low-income people. They are tethered to reality on the one hand in a way advocates are not always," Brooklyn Councilman Brad Lander said in a recent interview. "Also, the politics have obviously pushed them strongly in that direction. It's clear that even though they wind up pushing back, that it matters to them."

Moderate and middle-income New Yorkers, defined as three-person households making roughly $69,000 to $141,735, are now slated to get 39,000 subsidized homes, compared to 44,000 in the initial plan.

The bulk of the homes — 111,000 — will be rented to those classified as low income, or families of three making between $43,000 and $68,720. That marks a 5,000-unit decrease from the earlier target.

To achieve these changes, the Department of Housing Preservation and Development recently rewrote its term sheets to require developers receiving public subsidies under certain programs to set aside a fraction of their units for the poorest New Yorkers. Studies show far more impoverished New Yorkers pay large shares of their income in rent than wealthier tenants who qualify for "affordable housing."

Before the change that took effect July 1, the agency provided more subsidy for lower-income tenants, but did not include that mandate.

So far, the city has financed 77,651 new and preserved apartments — 12.5 percent for households earning roughly $104,000 to $142,000 and 14.8 percent for families making less than $25,770. Critics argue the city should not spend any money subsidizing housing for people who can otherwise afford it; the mayor repeatedly points to a housing shortage for middle-class families in a city of extreme wealth.

"It is important in the implementation of this plan to recognize that there is need across different income ranges," housing commissioner Maria Torres-Springer said in a recent interview. "So, we have to help extremely low-income families, we need to help very low-income and we also have to help a lot of the middle-class families who are being squeezed out of the city."

"We hear all the time from many different stakeholders in the affordable housing community and neighborhoods about ways we can do more and ways that we can do better and we take each and every one of those pieces of feedback very seriously," she added. "We're not just reacting in a knee-jerk way to what we're hearing, but we're taking the types of steps that we know are going to be successful, that we know are a good use of taxpayer dollars."

Most new term sheets also require 10 percent of subsidized units be set aside for formerly homeless New Yorkers — an effort to reduce the growing population of New Yorkers living on the streets.

Previously, the rules offered financial incentive for homeless units but no requirement. As a result, officials said developers often opted to rent apartments to homeless families at the expense of the poorest New Yorkers.

"My low-income families that were not in the shelter system were not getting access to the 30 percent AMI units," Bronx Councilman Rafael Salamanca, who advocated for the change, said last week.

The administration has made other overtures recently, including a proposal last week to award $1.65 million to create and expand community land trusts, which are nonprofits that own land so residents maintain a say over development. The model is a priority for those who argue too much of the city's housing is built by for-profit developers whose restricted rents typically end after 30 years unless their deals with the city are renewed.

Rafael Cestero, a Bloomberg-era housing commissioner who now runs the Community Preservation Corporation, which finances affordable housing, predicted City Hall would begin embracing more nonprofits.

"Just like they modified the term sheets based on how things were actually working … I think you'll see them do that around the issue of nonprofit participation," Cestero said. "There is no doubt that they are hearing the criticism and I think you'll hear them try to respond to it by creating more opportunities for nonprofit participation."

Brooklyn Councilman Jumaane Williams, who chairs the Council's housing committee, said the changes are welcome but insufficient.

"I just commend them on achieving this," he said in a recent interview. "From the beginning, I've said the plan wasn't enough. So it's great when you're matching it against the original plan they put out, but we know it's not enough."

And Jonathan Westin, director of advocacy organization New York Communities for Change, called it "too little too late."

"We went three and a half years with what was supposed to be the most progressive mayor in America, and the homelessness crisis has gotten worse," he said.