Billions of Dollars in Government Subsidies for Affordable Housing Would Be Accountable under New Bill from Kallos, Williams, Mendez & Brewer

12/07/2015

Billions of Dollars in Government Subsidies for Affordable Housing Would Be Accountable under New Bill from Kallos, Williams, Mendez & Brewer
50,000+ previously unaccounted for affordable homes will be registered
Residents could find and apply for all of city’s affordable housing in one place
 New York, NY – Landlords who received over $1 billion in government subsidies and tax breaks as well as all owners of existing rent regulated or other affordable housing across federal, state, and city programs will be required to register each unit of housing with the Department of Housing Preservation and Development (HPD). Regular monitoring and enforcement will be followed by steep penalties for owners who fail to register. New Yorkers in search of affordable housing could find it easily by providing financial information to apply for new lotteries, find vacancies, and check their position on waiting lists.
 
Owners of 15,000 buildings in New York City that received over $100 million in property tax reductions in exchange for building affordable units illegally failed to register with the state’s Division of Housing and Community Renewal (DCHR), according to a recent investigation by ProPublica, which estimates the unregistered units in these buildings at 50,000. According to City’s Department of Finance (DOF), over $1 billion dollars in incentives were provided to developers under the 421-a and J-51 affordable housing programs in fiscal year 2015. In 1993 New York State eliminated penalties for failing to register, allowing thousands of building owners to ignore the law for years and charge rents above the legal limit.
 
“Our City is in desperate need of affordable housing and we cannot allow landlords to hide even a single unit of it from the public,” said Council Member Ben Kallos. “We need a full accounting of every affordable unit of housing in the City and we need regular monitoring and strict enforcement. If we’re going to give away billions of dollars in incentives and property tax reductions to developers in exchange for building affordable units, we need to know where every single one of those units is and ensure struggling New Yorkers have the tools to find, apply and get affordable housing.”
 
“Requiring affordable housing to be registered and accessible through a user-friendly portal is a good idea that’s long overdue,” said Manhattan Borough President Gale A. Brewer, who is sponsoring the legislation in partnership with Councilmember Kallos. “In 2015, there’s no reason this information should be scattered among a hodgepodge of websites and PDF flyers, or for affordable units to go unregistered and unpublicized because of a lack of accountability.”

The legislation seeks to solve the following longstanding problems with affordable housing:

  • Non-Registration – owners fail to register thousands of buildings with tens of thousands of units for which they receive hundreds of millions in tax breaks each year.
  • Paper Applications – applicants must mail an application request, receive the application by mail, return the application by mail, and wait hoping nothing got lost in the mail.
  • Lotteries and Rejections – three quarters of applications have been rejected in lotteries because individuals apply for the wrong affordable housing for their income.
  • Waiting List Corruption – investigations revealed dozens of instances of corruption and bribery surrounding waiting lists for affordable housing.
  • Numerous Individual Places to Apply – Multiple websites offered by DHCR,HPDHDC  and non-profits like Met Council as well as at individual affordable housing buildings.

 
The legislation would provide the following solutions:

  • Owner Registration – owners of rent regulated or affordable housing receiving government subsidies would be required to register each unit online with the city on an annual basis.
  • Enforcement and Fines – enforcement would be required by HPD, with a private right of action for individuals, with penalties that escalated from $100 per month per unit to $2,000 per month per unit.
  • Preventing Warehousing – where is not already illegal, it would be illegal to warehouse any affordable housing unit for which a government subsidy was received.
  • Protection from Illegal Rents – tenants could verify the legality of their rent by entering personal information and current rent to receive their rent history from HPD.
  • Manager and Superintendent Information – currently filed by owners under the housing maintenance code, this information would be available online for the public.
  • Matching Residents with Single Application for All Affordable Housing – residents could enter their financial and household information to be matched through a single online application to all affordable housing opportunities for which they qualify.
  • Lotteries and Waiting List Transparency – anonymous unique identifiers for both units and applicants providing privacy protection through online tracking of the lottery process and waiting lists by all by web, email or text, along with whether an applicant received a preference and a list of the possible reasons for that preference.
  • Privacy – privacy protections would be provided for victims of domestic violence with units receiving tenant based financial assistance such as SCRIE, DRIE, or HASA excluded.

 
“This bill is a huge step forward in creating transparency about affordable housing in NYC.  This will provide an additional check to ensure owners are registering their affordable housing and give tenants the information they need to make well informed decisions their housing needs,” Harvey Epstein, Director Community Development Project, Urban Justice Center. “I want to applaud the efforts of Councilmembers Kallos, William and Mendez as well as Borough President Brewer for introducing this and we look forward to quick hearing and passage of this important legislation.”
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