Mayor de Blasio still hasn’t identified the public housing projects that will be targeted for private development under a controversial new plan, but after a meeting last night, it’s clear that the Lower East Side is a strong candidate for the mix of affordable and market-rate housing.
Brian Honan, director of governmental relations for NYCHA, said in a presentation to Community Board 3’s public housing committee that an announcement about NYCHA’s NextGeneration program was coming “within the next few days.” He added, “I’m not going to say where it is because that’s all going to be announced within the next two weeks, but there are plenty of development opportunities in the Lower East Side.”
In total the new housing will consist of 10,000 units in buildings with only affordable housing and 7,000 units in buildings that are half affordable and half market rate; the latter is estimated to generate $600 million in revenue, helping NYCHA crawl out of its current $425 million deficit and reach its goal of a $8.5 million surplus by 2025, Honan said. “That’s a large amount of money that will stay within that development, so it will benefit not only the residents that live in that development but NYCHA as a whole,” he said. “It’s a plan that’s bold, and some of the things aren’t popular, but at the same time if you say ‘I don’t want that,’ you have to think about what you are going to do in its place to make up revenue.”
Critics have said NextGeneration, which is part of Mayor de Blasio’s affordable housing initiative, is too similar to a Bloomberg-era plan that would’ve allowed private developers to build 80-percent market-rate housing on NYCHA playgrounds and parking lots in Campos Plaza in the East Village and Baruch and Smith houses on the Lower East Side, among other sites. The City Council, along with NYCHA tenants, sued to prevent that land-lease plan from going forward and de Blasio, upon taking office, said he wouldn’t pursue it.
Last night, Honan said that unlike previous plans, de Blasio’s includes extensive community outreach prior to developing the new buildings. “I do not think that in any of these sites we will have 100-percent consensus — there will be some people for it and some against — but folks will be brought into the conversation. Decisions will be made at the tenant level,” he said.
Committee member Enrique Cruz said there hasn’t been a trusting relationship between tenants and NYCHA officials for the last 20 to 30 years. “They say they’re going to do outreach, and it turns out they listen to what tenants say and go behind closed doors and make their own decisions,” Cruz said. “I think I would feel more comfortable if some of the stakeholders were part of the conversation, so would the agency be open to taking into consideration allowing some of the tenants association presidents be part of the conversation?” he asked Honan.
“No,” Honan replied, “and the reason why is not all tenants association presidents are the same. There are many who I would not trust, and I don’t believe they do a good job. We will have a robust engagement process, but at the end of the day, though, we are an authority, and we have to make some decisions on our own, and we have to make some decisions together.”
Honan also spoke of using the U.S. Department of Housing and Urban Development’s RAD plan, which allows public housing units to be converted to Section 8, to provide more capital for public housing repairs and maintenance. He explained that while private landlords can refinance their property to pay for things like a new roof or boiler, public housing is “not able to do that. You’re at the mercy of the federal government to provide capital funding for those types of things.” Section 8 vouchers have a value that can be borrowed against, giving landlord capital to invest into their property.
Though the RAD website states that units move to a Section 8 platform with a long-term contract that, by law, must be renewed, ensuring that the units remain permanently affordable to low-income households, some committee members were skeptical. “There are red flags when you keep moving closer and closer to needing Section 8 to maintain housing, and then it sours into market-rate housing,” Committee Chair Lisa Burriss told Bedford + Bowery after the meeting. She pointed to Campos Plaza as an example. The Alphabet City public housing building had 50 percent of its shares sold off to private developers last year. “The half that was Section 8 is what got sold,” Burriss said.
Though the purchase of Campos came with incentives for the developers to keep the units as affordable housing (The Wall Street Journal reported that they would be entitled to receive from the federal government the difference between market rents and the rents housing-authority tenants pay), the agreement expires in 30 years. At that point they could be converted to market rate, though NYCHA would retain the power to make that decision.
Critics like City Council member Rosie Mendez have characterized the plan as a road to privatization, and Burriss takes a similar view. “I’m psyched for more affordable housing if it’s really affordable,” she said, “but they just sold [Campos]. They just sold public housing that was right here. They’re not really creating it if they have to keep graduating it to market rate. That’s not creating more public housing, that’s just trading it off. Keeping everyone busy.”