Vicki Been, the new commissioner of the New York City Department of Housing Preservation and Development, was put on the spot about the agency’s downsizing program for subsidized housing yesterday during a City Council hearing. This downsizing involves moving tenants from apartments that are too big for residents to more appropriately sized ones. Questioning from City Council members and Public Advocate Letitia James at the hearing centered around the sick and elderly who go through tremendous shock or strain if moved to a new, unfamiliar apartment that may not be suited to their needs. The appeals period was another area of concern—a period of only 15 days—which many cited as not enough time for someone to get documentation of a medical condition from a doctor. The downsizing is a result of the 2013 national sequestration. HPD was hit with a sudden and brutal $37 million in federal cuts. Been said that HPD downsized to prevent kicking out approximately 3,000 families from public housing. “I’m faced with a Congress that is dysfunctional at best, and is leaving us in the position where we’re either cutting people out of our program and taking vouchers away… or taking these kinds of steps to try and save some dollars so we don’t have to cut people off the program…It’s not a choice that I or my staff have taken lightly. It pains us enormously. And that’s where we are.”
Category Archives: Housing
What a difference a new administration makes. At the end of last year developer Jed Walentas had a deal in place to turn the waterfront Domino Sugar Refinery into high-end Williamsburg apartments, including 660 units of affordable housing— roughly 30 percent of the building’s capacity.
Walentas’ company, Two Trees, had already played an integral role in transforming formerly down-and-out Brooklyn neighborhoods like DUMBO into glossy, expensive new locales for the rich and hip—and the Domino project appeared set to be the next outpost in Walentas’ empire.
Then Mayor Bill de Blasio coasted into office in January touting his campaign promise to create or preserve 200,000 units of affordable housing. Rather than abiding by the deal Walentas had struck with the Bloomberg administration, de Blasio let the developer know that Two Trees’ plans for Domino were in jeopardy because its affordable housing allocation was insufficient.
In March the de Blasio administration announced that Two Trees had essentially bowed to its demands, agreeing to add 110,000 square feet of affordable housing to reach a total of 537,000 square feet. The revised Domino project is slated to create 700 affordable apartments covering a range of incomes, and there will be a significant number of two-and three-bedroom units sized for families. The affordable apartments will be integrated throughout the complex with the aim of creating a dynamic mixed-income community— and unlike in prior proposals, all of those units will remain at affordable rates in perpetuity.
In return, Two Trees was allowed to increase the height of the project to 55 stories, which, according to The New York Times is “20 stories higher than the current regulations permit.”
Despite the new agreement, at a City Council hearing on April 1 focusing on the latest version of the Domino project, some advocates and elected officials expressed concerns.
“Many times these kinds of [inclusionary zoning] deals [have been] done on negotiated understandings with developers that were not necessarily legally binding. It’s important to have it actually legally codified,” said Moses Gates of the Association for Neighborhood and Housing Development (ANHD). “To Two Trees’ credit, they were always open to that paradigm. The next step is to really write these affordability restrictions into the zoning code across the board, and not have to rely on ad hoc negotiations on affordability for each new development.”
The fungibility of affordable housing requirements was reinforced when Steve Levin, one of two Council members who represent Williamsburg, pressed Walentas about the specific number of affordable housing units the project would ultimately include. Walentas admitted that the number might actually end up being fewer than the 700 units agreed to with the de Blasio administration.
“We’ll be building a guaranteed minimum … As a developer with a billion and a half [dollar] project over many years before us, there’s a good chance that we build fewer than we build more,” Walentas said. “My best guess would be somewhere between 660 and 700 affordable units.”
The vagueness of that number highlights a deficiency in what has become one of the city’s chief tools to create new affordable housing: “inclusionary zoning”—the requirement that a developer include a certain percentage of affordable housing units in exchange for being allowed to build. The percentage of affordable housing is measured in square feet, not by the number of units, meaning that housing advocates’ push for larger apartments could wind up bringing about a diminution in the total number of units ultimately made available when the project is completed.
In his testimony before the Council, Walentas made clear his displeasure about the sudden left turn the Domino deal had taken after the de Blasio administration got involved.
“We have spent the better part of one and a half years listening to our and your community and their concerns, and until six weeks ago, we believed that we were headed down a road where on that first building there would be a significant amount of city subsidy made available, and when we got to this point in the process … there would be a three-party agreement that would lock in the amount of city subsidy, the specific AMIs [Average Median Incomes] on that project, and it would be benchmarked to certain unit size,” Walentas said. “It made economic sense to us, or at least made for a project that we know we could finance … The administration went in a different direction, so we had a whole economic framework in place for this entire project that basically went out of the window. Our internal financial assumptions have been reeling since then.”
Developers like Walentas should expect that the de Blasio administration and City Council’s increased demands for affordable housing will constitute a new normal for the industry. At the Domino hearing Councilwoman Elizabeth Crowley, addressing Walentas, seemed to sum up the general feeling among her Council colleagues.
“This is a different Council today than it was a few months back. We have much more progressive leaders that care about workers and families. And your project is going to set a precedent for the rest of the city,” said Crowley. “You’re going to receive a significant amount of funding through tax abatements and government bonds … and overall it looks like it could be a gain for our city, [but] we need to be sure. So us acting for an MOU [Memorandum of Understanding], even though it may not be binding, we’re going to trust that agreement, because you’re going to be back here asking for zoning changes in the future.”
If the affordable housing goals promised by Two Trees are met— and met in a timely fashion—the Domino project could provide a shot at redemption for de Blasio, who has endured criticism for his support as public advocate of the Atlantic Yards project, where the agreed-upon units of affordable housing have been built at a much slower pace than promised.
After talking tough about enforcing the affordable housing agreement struck between ACORN and Forest City Ratner, the developer of the project, de Blasio’s commitment to holding Forest City’s feet to the fire came into question when Bruce Ratner, the company’s CEO, co-chaired the mayor’s 50th birthday fundraiser.
When she was still the City Council member representing Atlantic Yards, Public Advocate Letitia James said of Forest City’s failure to meet the affordable housing goal on schedule, “New Yorkers and taxpayers were basically duped.”
To guard against a scenario like the one playing out at Atlantic Yards, Benjamin Dulchin, the executive director of the ANHD, suggested in his testimony before the Council that the city mandate inclusionary zoning to give it better leverage in the future.
“Domino is a good start, but just a start,” Dulchin said. “The last administration gave away the store. This administration should do better. That probably starts with a baseline of a strong and mandatory inclusionary zoning policy so the city starts from a strong position in every negotiation like Domino.”
This Thursday, the ANHD’s 4th Annual Community Development Conference was held at the Grand Hyatt Hotel in Manhattan. They keynote speaker was Vicki Been, Mayor de Blasio’s pick to run the Department of Housing Preservation and Development, commonly known as HPD.
Mrs. Been emphasized several times in her remarks that she could not provide many specifics about Mayor de Blasio’s housing plans – yet. “I’m not withholding details. But they’re really honestly in progress,” she said, referring to the Mayor’s planned May 1st affordable housing announcement.
She did, however mention broad ideas that echoed throughout the all-day conference, such as allowing higher density building, preserving current affordable housing, and taking a more holistic approach to neighborhoods. This includes aspects of community life like employment, healthcare, and literacy, rather than just aiming for that famous 200,000 number that Mayor de Blasio has touted.
Mandatory inclusionary zoning, a de Blasio idea , merited its own panel. Mandatory inclusion would require developers to include affordable housing units rather than continue to offer them incentives that currently exist. Josiah Madar of the Furman Center talked about the bureaucratic problems that developers currently face. “The administrative burden frightens or at least turns off some possible participants. Developers always complain about the city dragging its feet…we’ve heard that HPD’s approval can delay projects. Paying more attention to admin is a way to grease the rails.” Another panelist, Seth Ullman, spoke about the trouble measuring the impact of voluntary inclusionary zoning that is already in place. “Trying to evaluate how the programs work has been a challenge because it’s not administered in a way that ‘s entirely transparent. We can’t see where every unit that’s been built on either side – affordable or for profit – has gone.”
Frank Lang, the Housing Director at St. Nicks Alliance, spoke about land prices. “The price of land is going to be a real determinate. There’s a lot of people who own land, and have owned it for many generations, and they have an expectation of what the price is. During the real estate bubble bursting, we saw those people were willing to wait out the four years until they could get the price of land per square foot that they expected in 2007.” Josiah Madar elaborated on land use problems for affordable housing by taking aim at New York City’s low property taxes. “Things are just strange here, where the city can’t or won’t raise more money through the property tax where it could. Where people have extremely low effective tax rates. “
Later on, at a Future of Affordable Housing Development in NYC panel, the tone was celebratory, but remained vague.
City Councilman Jumaane Williams emphasized points that had been made throughout the conference. “We need to go further to preserve even more units… The unions have come to the table and are speaking with the housing advocacy world…Looking at AMI (area median income) is also important to me….inclusionary mandatory zoning is important but only if you put it in context with everything else that is going on. “ He added later “I don’t mind developers making money, I just don’t want them making all the money.”
The new head of the New York City Housing Authority, Shola Olatoye, was clear that she sees a new day for her organization. “The Mayor has really brought NYCHA into the conversation, and removed us from that island status.“
When asked about the role that intermediaries had to play to ensure that neighborhoods, not deals, were the focus of housing policy, Denise Scott of LISC NYC strongly endorsed third party mediators. “I call for a third of it (the capital budget) to be set aside for not-for-profit development.” The audience applauded. “Your work is grounded in a mission that goes beyond the house, it is focused on the whole family.”
Scott, however, also offered a kind of concession to the long-haul fight for affordable housing in New York City. “At the end of the day, we are willing to say that we’re willing to take fewer units for long term affordability. I think that needs to be part of the reality.”