Legislative Memorandum in Support of A 7805A
We write jointly in support of the creation of the NYC Public Housing Preservation Trust (A 7805A) in the current legislative session. We believe this is an urgent, one-time opportunity for the state to create a public-benefit corporation with the potential to access the full capital funding NYCHA needs to address its $40 billion backlog in infrastructural repairs and restore decent conditions to all of New York City’s public housing residents.
The RAD/PACT Program in Perspective
At present the RAD/PACT program is the authority’s prime preservation strategy, which is planned to place selected developments—62,000 out of NYCHA’s 170,000 units—in the hands of private ownership and management. About 10,000 units are now in the RAD/PACT pipeline. While we accept that RAD/PACT is presently the only available antidote to past government disinvestment and its current reluctance to reinvest, we have always taken exception to the privatization aspects of the program and urged that conversion not proceed without resident consent.
Comparative Advantages of the Preservation Trust Model
The Preservation Trust would provide a new, additional preservation option with several advantages: It is a comprehensive strategy with the potential to restore decent resident conditions at all NYCHA developments. Under the legislation, leasehold interests for each development would be transferred to the Trust, with enriched funding that makes it possible to reach NYCHA developments where RAD/PACT conversion is not feasible. Instead of privatizing ownership and management, the Trust would keep our public housing in the public domain and retain the NYCHA public workforce. Developments restored through the Trust would remain affordable low-income housing, in public hands, under public funding, through a rich stream of federal Section 8 Tenant Protection vouchers. These project-based vouchers are made available through the existing HUD Section 18 Disposition program for seriously deteriorated developments. NYCHA estimates that a typical unit would receive $1,250 monthly under RAD/PACT, compared to $1,900 under the Section 8 vouchers. By using the existing Section 18 program, NYCHA will not have to depend on Washington to come to the rescue with new federal legislation.
As a state-created entity, the Trust will also enable NYCHA to bypass outdated federal procurement regulations and modernize its contracting procedures, including the use of the “design-build” model. Interestingly, the Trust model has received support from the current HUD administration.
Key Resident Protections and Rights
Most importantly, the Trust legislation has now been amended in response to resident concerns: Since Section 18 conversion requires that the development be transferred out of the HUD Section 9 public housing program into the Section 8 program, the amended bill assures that residents will retain all the rights and protections they enjoy under public housing.
The bill also now includes an important “resident opt-in” provision that assures that conversion under the Preservation Trust will not be imposed on resident communities that oppose it. This provides residents with unprecedented leverage in determining whether and how conversion will proceed. In that sense the Trust does not abridge preservation options available to residents. Rather, it adds to their options.
Recommendation
For decades, NYCHA has suffered from government disinvestment and starvation federal funding. It is the residents who suffer daily as a result, from roof and plumbing leaks, elevator failures, heating and hot water outages, toxic mold, and the like. In addition to its capital backlog, NYCHA has been experiencing significant operating deficits, compounded by over $100 million in rent arrears due to the pandemic. Given the dismal prospects of the federal Build Back Better bill, or other significant government capital commitments, the Preservation Trust assures that NYCHA can proceed to meet all its infrastructural needs.
Together, the Legal Aid Society and the Community Service Society urge you to support the creation of the Preservation Trust, as a way to ensure the future of NYCHA and its residents.
Sincerely,
Adriene Holder
Attorney-in-Charge, Civil Practice
The Legal Aid Society
David R. Jones,
President and CEO
Community Service Society