Wednesday, August 08, 2007

Phil DePaolo tells it like it is

Mayor Bloomberg, Second Mayoral Debate, November 1 , 2005:
“This is an expensive city; it always has been, probably always will be.”

We have seen first hand the devastating effects of the New York City housing boom on the residents of our city, mainly low income people who cannot afford to live in their apartments with all the rent increases applied to rent stabilized apartments.

In the 1970s, when no one was developing, the 421a program was a wonderful plan. The original intent of the law establishing the 421-a tax abatement was to encourage housing development in an area where market rate development was not occurring and would not occur without the tax abatement. In return a developer could expect that by the time the full tax on the building had phased in, tenants would be paying rents that were high enough to cover the higher tax bill. But now the incentive is used as nothing more than a come on to entice prospective buyers of luxury units. The abatement is a crutch for developers that costs the city millions in tax revenue, dollars badly needed to fund affordable housing and improve the city's increasingly overloaded infrastructure.
The 421-a program has subsidized over 100,000 housing units since the program’s inception. However, according to a 2003 report by the Independent Budget Office, only about 8% of the units were affordable to low or moderate income families. The cost of the program to the City of New York has grown 150% in the last four years. Another report by the Pratt Center for Community Development also found that while the 421-a program did subsidize the building of more than 100,000 units since 1971, again only 8 percent of them were actually affordable for low and moderate income residents and with soaring rents and record numbers of homeless the city and state must continue to do what they can to fill the void.

A huge problem we see is that affordable housing is calculated off of the HUD AMI charts, which groups all of NYC together, so that the median income for a family of four is 70,900, and 80% of AMI is considered low income. With a community AMI of $30,000 and average renter wages of under $14.00 an hour even at 60% of AMI most residents in Williamsburg and Greenpoint Brooklyn will not be able to afford the units proposed under Chairman Lopez's Bill. We also worry about the fine print in the new HDC programs, which now has affordable housing rent to income ratios going all the way up to 35%, when the entire country uses 30% as a standard. It seems like it might not be much, but if you do the math, that extra 5% really squeezes working families!

The current zoning incentives are not working, Inclusionary Zoning is not working and expanding the 421a program with the use of IZ will not stabilize low and middle income neighborhoods. It will kill them!

It's very important to focus on the luxury units which invariably change the economic demographics of less affluent communities and have the effect of forcing out the less affluent. The wealthy residents that move in have larger incomes putting pressures on local retail outlets to change the mix of amenities. Instead of hardware stores, affordable supermarkets and Laundromats, the commercial core changes to noisier bars, expensive restaurants, boutique food markets and so on. Stores offering less expensive goods can no longer pay the cost per square foot of the gentrified neighborhood.

While some affordable units are built, there's a larger net loss of affordable housing in the surrounding areas as real estate values and rents rise. With the loss of protections and enforcement of any meaningful rent regulation, surrounding neighborhoods are being torn apart.

I reject the idea that private developers need to have hefty 421a tax incentives to provide construction where the majority of the new units are market rate. Such developments are destroying low and working class neighborhoods, and the home to generations of immigrants are becoming unrecognizable.

If our elected are going to allow what is basically fair market rate housing to pass as "affordable" to residents of our City we need to hold our elected accountable as well.

According to the National Low Income Housing Coalition the Fair Market Rent (FMR) in New York for a two-bedroom apartment is $1,076 a month. In order to afford this level of rent and utilities, without paying more than 30% of income on housing, a household must earn $3,588 monthly or $43,051 annually. Assuming a 40-hour work week, 52 weeks per year, this level of income translates into a Housing Wage of $20.70 hr.

In New York, a minimum wage worker earns an hourly wage of $6.75. In order to afford the FMR for a two-bedroom apartment, a minimum wage earner must work 123 hours per week, 52 weeks per year. Or, a household must include 3.1 minimum wage earners working 40 hours per week year round in order to make the two bedroom FMR affordable.

I believe that this new Bill will not create substantial amounts of real affordable housing .At this time, market rate housing development is clearly occurring and will continue to occur in the city without the benefit of the 421-a tax abatement. Therefore, the tax abatement is no longer needed as an incentive. I believe this Bill as written still gives way too much to developers and will not stabilize communities that are being targeted by rezoning and gentrification. Once again the City and State have missed an opportunity to pass meaningful 421a reform and the low and Middle income residents of our City will continue to be the victims.


Monday, August 06, 2007

City-wide tenants union meeting

Spread the word --

City-wide Tenants Union Meeting!
to plan
on rent regulations,
on tenant protections,
on displacement, harassment, tenant law,
the failure of city agencies to uphold the law,
and the upscale overdevelopment of our city

Wednesday, August 15, 7pm
172 Norfolk Street

(one block east of Essex/Ave. A, just south of Houston)
basement level.
The Orensanz Foundation is a landmark of community organizing and the arts.
Grateful thanks to Al for donating his space!

New York is under assault from developers and landlords. Our legal rights and protections have been eroded, loopholes have been exploited and there is little or no regulatory oversight. Affordable housing that sustains communities is rapidly disappearing. We are in crisis.

UNYTE is a New York city-wide tenant's empowerment group formed to confront this crisis. We are a democratic grassroots organization open to all renters in New York: tenants organizing tenants into a powerful political voice to strengthen tenant protections, laws and regulations and ensure government accountability, transparency, oversight, responsibility and enforcement.

Come help us plan an event that will bring the city's attention to the needs of its people.