- Associated Press - Tuesday, May 19, 2015

NEW YORK (AP) - A plan to tackle “the worst financial crisis” in the history of the New York City Housing Authority includes leasing unused land in housing complexes for private residential development, a proposal that has caused controversy in the past, as well as other steps like modernizing rent collection, Mayor Bill de Blasio said Tuesday.

“I wish I did not have to say that to my fellow New Yorkers, but this is literally the worst financial crisis that NYCHA has ever encountered” since its 1934 founding, de Blasio said at a news conference. If the city doesn’t act fast to fix it, the housing authority could face the prospect of going into federal receivership, as some similar agencies elsewhere have done, he said.

“That is not something we will allow to happen here,” he said. “We will make the changes and we will make them swiftly and aggressively.”

The city has grappled for years with its aging, deteriorating public housing, which houses over 400,000 people - more than the entire population of New Orleans - in more than 2,600 buildings around the city.

As federal and other governmental support for public housing dwindled over the years, NYCHA came to face $17 billion in needed repairs and improvements while running tens of millions of dollars in the red each year. Residents have contended with leaky roofs, mold, broken elevators, spotty heating, lagging security and long waits for basic repairs.

In one of the potentially stickiest aspects of the plan, developers would be allowed to build new apartment buildings on parking lots, trash areas and other open spots in NYCHA complexes. That would include about 10,000 apartments in buildings that will be entirely affordable housing, and about 3,500 more rent-regulated apartments - for families making about $46,000 a year or less - will be in buildings that are half affordable and half market-rate, de Blasio said.

The city plans to start announcing the locations in August.

The idea of building luxury apartments on NYCHA land was broached - and blasted - during former Mayor Michael Bloomberg’s administration, though with only 20 percent affordable apartments. The housing authority said the new buildings would be its best shot at getting big money for much-needed repairs, but some residents felt it wasn’t fair to use public housing land for other purposes and said they feared second-class-citizen treatment in their own neighborhoods.

“This is a very different plan” that places far more emphasis on creating new affordable apartments, de Blasio said.

The plan also includes boosting monthly fees from about $26 to $86 a month for the 10,000 NYCHA residents with parking spaces, leasing more of NYCHA’s over 2 million square feet of ground-floor commercial space, and modernizing rent collection with online payment options and other changes.

At the moment, NYCHA collects only about 74 percent of rent and fees.

Overall, the initiative would address $4.6 billion of NYCHA’s repair and improvement needs and create a $200 million surplus over 10 years, de Blasio said.

Reginald Bowman, who heads a citywide group of NYCHA tenant leaders, urged them to get behind the plan, calling it a promising “blueprint for change.”

“This is an opportunity for there to be major progress in restoring the cornerstone public housing infrastructure” in a city that relies on it heavily, said Bowman, who lives in a NYCHA complex in Brooklyn.

Jonathan Westin, executive director for New York Communities for Change, said it was good city officials “are taking significant steps toward providing NYCHA with the solvency it needs to address overdue repairs and provide their tenants with basic dignity.”

He said it was important to push the state and federal government to do more as well.

De Blasio announced earlier this month that the city plans to waive NYCHA’s $30 million-a-year payment to the city in lieu of taxes, and the city already has forgiven the approximately $70 million that NYCHA owed the New York Police Department for providing security.

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