New York State Lawmakers Approve Major NYCHA Funding Change

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City leaders and lawmakers say thousands of New York public housing residents who have been forced to live with leaks, mold, broken elevators and broken boilers could finally see better living conditions. in what could be a fundamental shift in how public housing is funded in the city.

The state Legislature on Thursday passed a bill that would allow the New York City Housing Authority, or NYCHA, to create a public benefit corporation that could raise billions to renovate up to 25,000 apartments.

The newly created entity, the Public Housing Preservation Trust, would allow the housing authority to issue bonds and borrow money from private investors to pay for repairs. The model has been in sight for NYCHA since 2020 and is designed to shift authority away from direct federal grants — which Congress has increasingly targeted with budget cuts over the past few decades — and more toward a voucher-based system. .

The legislation, backed by Mayor Eric Adams and Governor Kathy Hochul, passed the Senate by a vote of 38 to 25 on the last day of the legislative session. The Assembly approved it on Wednesday by a vote of 132 to 18. The bill is now heading to Hochul’s desk, and the governor is expected to sign it.

“For decades, NYCHA residents have been promised repair after repair that never materialized, but, together with the Public Housing Preservation Trust, we will finally deliver on those promises and provide NYCHA residents with dignity and homes. safe, high quality and affordable they deserve,” Adams said in a statement.

With approximately 176,000 apartments under its control, NYCHA is the nation’s largest source of affordable housing for low- and middle-income New Yorkers. For decades, its more than 400,000 residents have lived in aging buildings that need repairs estimated at $40 billion.

According to the proposal, up to 25,000 apartments could be rented to the newly created trust, which would convert public housing under Section 9 of the US Housing Act, to the rental voucher system known as 8, allowing NYCHA to access federal funding. The housing authority would continue to own and operate the buildings and land.

In 2019, the average Public Housing Program unit received $1,250 per month in federal funding, while the average Section 8 Tenant Protection Bond received $1,900 per month, or an additional $650 per unit. per month, according to Greg Russ, president and CEO of NYCHA. officer. Russ said the trust could then leverage the additional funding as a way to borrow additional money from private investors to pay for maintenance and repairs.

Residents have the opportunity to join the program. Under the legislation, NYCHA can go back to state lawmakers each year and ask the legislature to authorize the transfer of additional apartments to the trust.

The newly formed public benefit corporation would be governed by a nine-member board, which would include four NYCHA residents, two NYCHA executives and a deputy mayor. The remaining two positions would be appointed by the chief executive of the housing authority and the mayor.

Many tenants and some lawmakers opposed the plan, including the bill’s original sponsor, Sen. Brian Kavanagh, who ultimately voted against it on Thursday. Senator Julia Salazar of Brooklyn reintroduced the bill last week after Kavanagh withdrew her support. Kavanagh did not respond to a request for comment on why he dropped his support. Salazar also did not respond to questions about why she stepped in at the last minute as Bill’s godmother.

The City Council of Tenant Association Presidents NYCHA, the governing body that represents all public housing residents, also opposed the bill. Only one of its 10 members supported it.

Tenants and advocacy groups say they fear the plan will threaten or weaken many of the strong protections NYCHA residents currently enjoy, such as the right to an administrative hearing before the housing authority decides. can evict them, and the possibility of passing on an apartment to the next generation. They are also concerned that giving the trust the power to borrow money exposes NYCHA to potential financial problems in the future if the trust cannot repay its loans.

Marquis Jenkins, co-founder of Residents to Preserve Public Housing, which formed to oppose the legislation when it was first introduced in 2020, said he was disappointed lawmakers voted in favor of the scheme.

“We will keep fighting,” Jenkins said. “The next battle is with [the U.S. Department of Housing and Urban Development] and Congress.

Nicholas Dagen Bloom, professor of urban policy and planning at Hunter College and author of “Public Housing That Worked: New York in the Twentieth Century,” said that while direct federal funding for public housing under Section 9a can -be operated in the past, NYCHA now has no choice but to pursue funding where available.

“If you don’t follow the federal money, you can’t be successful because it’s basically paying for it,” Bloom said.

He said the federal government had wanted to get out of the public housing sector since the 1970s and had largely succeeded in cutting funding for the Section 9 program.

While he admits there are risks in moving to the trust model, Bloom said the biggest risk is doing nothing, given the dilapidated state of many NYCHA buildings.

“It’s going to make a huge difference, a huge difference,” Bloom said.

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