Public Housing in Jeopardy

The large and growing operating deficit of the New York City Housing Authority (NYCHA) — now estimated at over $225 million — is a serious threat to the city’s public housing.  Spanning over 340 developments across the city, 180,000 units serving a half-million residents, public housing constitutes our primary affordable housing resource for low-income New Yorkers.

Public housing is a critical resource for New Yorkers of color.  Forty-seven percent of NYCHA households are African American; 41 percent are Latino.  Without public housing, thousands of these families would be forced out of the city.

The deficit can be fixed.  But it will require every level of government — city, state, and federal — to restore its commitment to public housing.

Contrary to perception, the NYCHA deficit is not just the result of the starvation of public housing by the federal government over the last decade.  The city plays a large role, for one, in contributing to the deficit and ignoring it.

NYCHA owns and operates 5,000 units of city-built public housing not eligible for federal subsidies.  They run at an annual $21 million deficit.  Operating subsidies are needed to cover the gap between what rents tenants can afford to pay and what it costs to manage and maintain the property.  This year the city – with over a billion dollar surplus - budgeted no operating subsidies for its units.

To make matters worse, NYCHA pays the city about $100 million annually under standing agreements that need to be changed or permanently waived.  NYCHA pays the city $23 million a year in lieu of property taxes (that other nonprofits are exempt from) and another $73 million a year for “special police services” that resident leaders claim they do not receive.

Layoffs Planned

NYCHA also plans to lay off 500 workers this year with further cuts in the future.  The authority has already cut 1,500 workers in the last decade.  The primary effect of the layoffs will not just be job losses.  The likely cuts in maintenance services that would accompany these layoffs will threaten the physical plant, reputation, and the livability of NYCHA communities.

Today, at 5 p.m., public housing residents, elected officials, union leaders, and housing advocates will be rallying in City Hall Park in support of public housing.  They will be calling on the city to fund its city-owned public housing through a budget modification that would ensure an annual operating subsidy of at least $30 million.

Governor Spitzer and the Legislature are to be commended for raising the public assistance shelter allowance NYCHA receives to the same level that private landlords receive.  About a quarter of NYCHA households receive some public assistance.  This will mean an additional $47 million a year for NYCHA.  But much more needs to be done.  The 16,000 state-owned units in the city have an operating deficit of $62 million.  Yet state funding was a mere $3.4 million in this year’s budget – out of a total budget of nearly $100 billion.

Diverting Funds

To make up for federal funding gaps, as well as continuing city- and state-generated deficits, NYCHA hopes to divert its federal Section 8 voucher funds to support its public housing operations.  Section 8 vouchers, now a separate program administered by NYCHA, are intended to enable low-income families to afford private rentals.

The U.S. House of Representatives has just passed the Section 8 Voucher Reform Act (SEVRA), which includes a Housing Innovation Program.  This would give participating housing authorities full funding flexibility, allowing them to move funds from Section 8 to cover their operating deficits.  If this happens in New York City, the losers will be the 120,000 low-income families on the Section 8 voucher waiting list, many of whom will be deprived of housing opportunities the vouchers provide.

The SEVRA bill is now in the Senate Committee on Banking, Housing, and Urban Affairs.  New York’s Senator Charles Schumer, a high ranking member of the committee, should exercise his leadership by ensuring a minimum loss of Section 8 funds in the final version of the bill.  An alliance of public housing resident leaders and advocates, in cooperation with NYCHA and the city’s Department of Housing Preservation and Development, are working with the senator and members of the city’s congressional delegation to find ways to protect Section 8 funding as much as possible.
Public housing
must be saved

In order to provide more adequate funding for NYCHA, Congress should pass the Public Housing Equal Treatment Act, sponsored by Senator Schumer and New York Congresswoman Nydia Velazquez, which would federalize city and state public housing.  This action would provide federal funding for these developments and reduce NYCHA’s deficit problems as well as preserve 21,000 units of the city’s public housing.

Unlike many other large cities, New York's public housing serves a broad mix of household incomes —average income is over $20,000.  One out of four households has an income more than twice the federal poverty level.  In New York City, public housing is the housing of choice for many, as evidenced by a waiting list of over 130,000 families. 

From the New York Amsterdam News
October 4 – 10, 2007