Testimony on NYCHA Capital Construction Facilities Management and Asset Disposition Policies

Victor Bach

Delivered to the New York State Assembly Standing Committee on Corporations, Authorities and Commissions

Improving and preserving New York’s public housing—179,000 apartments in 340 NYCHA developments across the city—is a high priority issue at CSS. We work on strategic policy issues (federal, local, and state) that impact these communities, alongside resident leaders, housing advocates, community-based groups, and other stakeholders. Periodic public housing forums on key policy developments are held at CSS to keep this network informed and alert. Most importantly, we convene the NYC Alliance to Preserve Public Housing, a working collaboration of resident leaders, advocates, and concerned elected officials, who each year develop a joint position on the NYCHA Annual Plan and press for needed changes. Two recent CSS reports have focused on NYCHA resident employment issues and workforce development strategies.

Escalating Number of NYCHA Property Disposition Proposals Projected

We appreciate this opportunity to talk about transparency and accountability measures under NYCHA disposition proposals to make public housing property available for private redevelopment. The issue is an urgent one.

NYCHA plans to make increasing use of its underdeveloped property as a way to raise private capital and investment that will yield the revenue it needs to operate and improve and its public housing communities. Last October, Chair John Rhea announced that in early 2013 the Authority will be releasing a comprehensive citywide plan that maps where and what kind of private redevelopment is under consideration. It will also release a list of “prime-market” developments targeted for early action. Now is the best time to decide what transparency and accountability measures are needed to keep residents and community stakeholders informed about redevelopment plans and assure they have an effective voice in negotiations with NYCHA and the developers.

It should be noted we understand why NYCHA is taking that course. Under chronically inadequate, starvation funding from Washington, it faces a $61 million operating shortfall this year, accelerating deterioration with year-long resident waits for needed repairs, and a $6 billion backlog in capital improvement needs.  Add to that the trauma of Superstorm Sandy and the pending threat of further federal spending cuts.  Regrettably, the Authority must rely on wise use of its underutilized real assets to take advantage of private redevelopment opportunities—typically for affordable housing and school construction, and for commercial and retail development—that will allow it to maintain its existing housing inventory and strengthen its communities.

Current Transparency/Accountability Measures re NYCHA Property Disposition

It is essential that NYCHA property disposition plans be transparent, that it be accountable to directly affected residents and to the broad community concerned with sustaining the city’s affordable housing resources. What are the current accountability measures in place? What is needed?

No authority is permitted to transfer, sell, or dispose of public housing property without HUD approval of a Section 18 Demolition/Disposition proposal.  Regulations require that NYCHA “consult” residents at affected developments prior to submitting a Section 18 proposal. In addition the federal 1998 Housing Act requires that housing authorities draft a written Annual Plan each year, allowing a minimum 45-day window for public review, followed by a required public hearing. Any NYCHA Section 18 disposition proposal must go through that gauntlet as part of the Annual Plan process before HUD will consider it.  These rules represent the current current “gold standard” for accountability. But they are not enough.

Need for Independent Technical Assistance to Affected Residents

Recent experience indicates that residents are often unprepared when NYCHA comes knocking at their door with a redevelopment plan to sell.  One out of three developments has no resident association. Those that are organized often depend on a small, active core of overburdened leaders, with low participation from most residents.

The Section 18 resident consultation process is important, not only because it informs residents about the projected redevelopment plan, but because it offers them some leverage in negotiating plan changes and gaining agreement on community benefits that come with the proposed redevelopment. Resident councils can gain important concessions, such as apartments in newly constructed mixed-income housing, a set aside for admissions to the charter schools, as well as Section 3 training/job opportunities in resulting construction contracts.

But resident associations are more likely to be overwhelmed by NYCHA planners. They don’t necessarily know their rights to pursue their legitimate interests—to open space, to environmental protections, to a binding agreement with NYCHA and the developers. With only NYCHA to rely on, given the Authority’s vested interest in redevelopment, they are like chickens counting on the farmer for advice.

CSS and the ALLIANCE propose that independent technical assistance be made available to resident councils going through the redevelopment planning process. Lawyers, planners, environmental consultants, employment specialists, can help residents identify issues in the plan, help them assess which options best promote their interests, and secure binding agreements in highly technical development proposals.

Such technical assistance need not cost NYCHA an additional dollar.  The Authority now holds $15 million in unused HUD TPA funds for tenant participation activities, which have accumulated since 2003. NYCHA receives an estimated $3.5 million in TPA funds each year. Among their intended purposes, HUD permits their use for “consultation and outreach…that support active interaction between the PHA [public housing authority] and residents.”  Some portion of these funds should be set aside for this purpose. Funding requests for outside technical assistance from resident councils facing NYCHA Section 18 redevelopment plans should be fast-tracked for this purpose. 

Setting aside technical assistance funding, and responding promptly to funding requests from resident councils facing Section 18 disposition and redevelopment, will depend on approval and coordination on the part of both NYCHA and the Citywide Council of Presidents (CCOP), the officially elected citywide body charged with representing residents in NYCHA decision-making.  To date, neither CCOP nor NYCHA has taken the initiative, even as NYCHA projects an escalating number of Section 18 property dispositions, and resident councils—particularly those in “prime-market” developments—brace themselves for early action designation. It is time for CCOP to speak up for the residents it represents, who will increasingly face private redevelopment plans without the resources they need to protect and strengthen their communities.

Special-Purpose Hearings for NYCHA Property Disposition Proposals

The Annual Plan process provides scant opportunity for focused resident and public comment on NYCHA Section 18 property disposition proposals. Each year NYCHA releases its draft plan by the summer and allows public review within the requisite 45-day period.  Then it holds the required public hearing, one-evening for oral testimony. Written comments can be submitted prior to the hearing.

While this constitutes compliance with federal accountability requirements, one needs to bear in mind that NYCHA runs the largest public housing program in the nation. Last year’s annual plan ran to 226 pages, excluding attachments that are available but not included.  The hearing starts at about 5:30 p.m. and ends more or less promptly at 8 p.m.  Those planning to testify must come early because many with high numbers in the queue often leave without testifying.  All testimony is entertained—whether it is a resident complaint about rodents, justifiable anger over pet policies, a harassing neighbor, or the Authority’s failure to make repairs. In the three hours provided, there is little opportunity to focus in on specific policy issues or entertain comments on particular Section 18 disposition proposals that are listed only briefly on several pages of the draft Annual Plan.

CSS and the ALLIANCE contend that NYCHA disposition and redevelopment proposals are too important to be treated in a three-hour hearing on a 226-page plan in a city with over 340 NYCHA developments.  We propose that special-purpose hearings be held by NYCHA on all Section 18 property disposition proposals so that they receive the focused attention they deserve, preferably at the affected development to promote a high turnout of residents.

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In summary, NYCHA is aware of these proposals; they were included in CSS and ALLIANCE comments on the last Annual Plan. But we have not yet received any clear acknowledgment that NYCHA intends to move forward on them: 1) to facilitate independent technical assistance to public housing residents facing private redevelopment plans, or 2) to hold special-purpose hearings on Section 18 property disposition and redevelopment proposals. 

We hope these Assembly hearings will provide further support for our position.  Thank you.

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