Number Crunching at the Core of Affordable Housing Squeeze

Photo by Scott Stiffler Opening this spring, the 33-story Abington House (at 500 W. 30th St.) borders the High Line. Of its 312 units, 78 are set aside for affordable housing.
Photo by Scott Stiffler
Opening this spring, the 33-story Abington House (at 500 W. 30th St.) borders the High Line. Of its 312 units, 78 are set aside for affordable housing.

BY EILEEN STUKANE  |  New York City does not just have an affordable housing problem. This city has a human problem. “My experience in the trenches is that it’s both the poor and the middle-income who are being left out,” says Bob Kalin, tenant organizer for Housing Conservation Coordinators (HCC).

“A pretty disturbing thing for me is, in the last couple of years, I’ve started to see clients of mine who we kept in their apartments for years, get evicted and become homeless in our community.” It is difficult for him to speak, as he tells of seeing one of his clients begging for coins in the Columbus Circle subway station.

In “What New Yorkers Want From The New Mayor: An Affordable Place to Live,” a study by the Community Service Society (CSS), a nonprofit advocacy group for low-income New Yorkers, researchers found that the city lost more than 385,000 units of affordable housing from 2002 through 2011. Tom Waters, a CSS housing policy analyst who co-authored the study, explains that a family of three bringing in $37,000 a year — which the US Department of Housing and Urban Development (HUD) considers very low income — would be able to afford an apartment for $900 a month. “So I asked what happened to those $900 or lower rent apartments,” says Waters. “Their numbers dropped tremendously. Every time an apartment turns over, if it was $900 before, the landlords renovate, raise the rents on regulated apartments, people cannot afford the increases, so they have to move out and rent goes to market value.” Gentrification of once-gritty neighborhoods like Hell’s Kitchen also provide an opportunity for landlords to increase rents.

What happens to homes for teachers, police officers, fire fighters, nurses, cooks, shopkeepers, men and women at the start of their careers or those who are winding down their work days — in other words, people who had once been considered the middle class?  “What do you mean when you say middle income, or the gap in the middle? That’s the biggest question,” says Moses Gates, program director for the Association for Neighborhood and Housing Development. It’s an important question because developers decide what income level will be acceptable for the units they set aside for affordable housing.

At the federal level, HUD takes a lot of data (including income, cost of living, census figures and more) to create an Area Median Income (AMI) that varies according to where you live. In New York County, the 2014 Median Income is $62,500. Developers who are getting a potpourri of incentives (a 421a tax credit, a low-income housing tax credit, 80/20 low-cost financing and property tax breaks as well as inclusionary and other rezoning regulations that allow them to build bigger) are guided by the AMI figures when offering their units to renters. In other words, units can be offered to those at 50 percent of AMI ($29,400 a year) or 80 percent AMI ($47,000 annually) or even 120 percent AMI, which Gates considers upper-middle income.

“There’s no resemblance to actual incomes of New Yorkers,” says Gates. “There’s a lot of data, the entire area is put through a big mishmash of manipulation and at the end of the day HUD comes out with a number which has consistently been about 20 to 25 percent higher than the actual median income of residents of the five boroughs. New York City median income has varied between about 70 and 80 percent of AMI pretty consistently since 2005. Housing that is developed at 80 percent AMI ($47,000 for one person; $60,400 for a family of three) is almost exactly middle-income, which is 53 percent of New York City households. But the government calls that low income.” Gates sees most city housing programs being offered at 60 percent AMI, what he considers close to middle-income, while the real low-income folks are being neglected. “The gap is at the low end,” he says. “We have a huge unmet need in low-income housing. It is more difficult and challenging to build low income housing rather than middle income.”

Joe Restuccia, executive director of Clinton Housing Development Corporation and co-chair of the Community Board 4 (CB4) Housing, Health and Human Services Committee, does not argue the AMIs: “The AMIs are census-driven. They’re a federal standard, nationwide. I think you hear, ‘We don’t like them’ and ‘We need them more tailored for our locality.’ They create a lot of discussion — maybe we should do this differently, maybe it should be local, by community board. My job is to be parochial in terms of the neighborhood but not to put blinders on. I feel pretty strongly about that. What are we talking about here? Let’s say we need to reach broader ranges of income bands. How do we do that? It means reaching broader ranges of AMIs, low end and more moderate middle end. That’s what’s being said underneath this.”

Photo by Scott Stiffler Subsidies through Manhattan Plaza gave Related Companies funding to build this 14-story, 139-unit building at 529 W. 29th St. Set to open in May, 70 percent of its units are set aside for artists, 15 percent for local seniors and 15 percent for locals of all ages.
Photo by Scott Stiffler
Subsidies through Manhattan Plaza gave Related Companies funding to build this 14-story, 139-unit building at 529 W. 29th St. Set to open in May, 70 percent of its units are set aside for artists, 15 percent for local seniors and 15 percent for locals of all ages.

With the combination of rent increases and job losses, Bob Kalin has noticed clinical depression surfacing among community residents. “If you came here as a young person to make your career, it’s very hard to give that up,” he says. “Sometimes I have to sit someone down and say, ‘You can get mad at me if you want, but the bottom line is you cannot afford New York. You can continue to struggle here and get in worse shape mentally or you can just accept it and move on.’ It’s definitely a hard aspect of what’s happening.”

The mood of a city fuels the engine that runs the machine. Despair is not good fuel — security is. Mayor Michael Bloomberg’s New Housing Marketplace Plan called for the creation and preservation of 165,000 affordable units by 2014, at the end of his 12 years in office. The economic crash in 2008 brought a virtual halt to new construction so the Mayor focused more on “preservation” — and by the time he ended his third term, approximately 66 percent of his 165,000 projected units were government-subsidized and rent-stabilized residences that had been retained rather than created. Meanwhile, in spite of the numbers of people who are fleeing the city due to economic hardship, New York City’s population increased from 8.1 million in 2010 to 8.4 million in 2013. Along with the arrival of the wealthy, is the rise of the poor. Where is everyone going to live?

Mayor Bill de Blasio has announced that he plans to build or preserve 200,000 affordable units over 10 years. Unlike Bloomberg, who gave developers the option to build bigger if they set aside 20 percent of their units for affordable housing, de Blasio would require developers to set aside low-and-moderate-income apartments, in effect creating mandatory inclusionary zoning and towering structures. The Mayor has said that he will announce his housing plan in May.

When asked his opinion on whether the 200,000 goal can be reached, Restuccia says: “There are a lot of very substantive discussions back and forth.  I’ve been in meetings with HPD [NYC Housing Preservation and Development], with Deputy Mayor Alicia Glen, with all kinds of housing organizations. You can really say that from within the administration, the Mayor, the Borough President, Councilmembers, everybody is focused on this [affordable housing] and that makes a big difference.”

Eric Bederman, spokesman for HPD, reports: “We are looking at as many options as possible to find new or improved ways to reduce the cost of construction, financing, and regulatory compliance, and to provide new tools to leverage private investment for the production and preservation of affordable housing.”

In Chelsea and Hell’s Kitchen, CB4 has been putting developers’ feet to the fire in recent years to demand that 80/20 affordable housing be included in the building boom on the Far West Side. Among other developers, they have had success with Related Companies in its Hudson Yards project and other properties. Related’s The Abington House, 500 West 30th Street, bordering the High Line, opens this spring with 78 of its 312 units as affordable housing, more than 20 percent. Using subsidies from its purchase of Manhattan Plaza, Related has constructed a totally affordable 139 unit building at 529 West 29th Street with 70 percent of the apartments designated for artists, 15 percent for local seniors, and 15 percent for locals of all ages. In the works, Clinton Housing Development Company has partnered with Taconic/Ritterman to create three new or converted buildings along West 52nd and 53rd Streets between 10th and 11th Avenues, bringing 210 affordable apartments to the neighborhood. Glitches are being worked out along the way.

Elected officials and community boards have learned to fight for certain issues — among them, confirmation from developers that apartments will be permanently affordable and not revert to market value rate in 20 or 30 years when a mortgage is paid; that cabinetry, appliances, fixtures will be to the standard of market rate apartments; and that amenities in a building, such as gym, spa, rooftop, will be as available to affordable apartment renters as they are to market value renters. The question then is: How does one get an affordable apartment that offers a secure base in New York City?

Community Boards often ask developers to set aside a percentage of affordable apartments for residents within that community. There are other preferences, such as set asides for seniors, or disabled people, or city workers. Certain buildings offer affordable housing for specific trades, like Manhattan Plaza, which has apartments for performing artists. A way to learn about preferences in affordable housing is to make sure you are on your community board’s emailing list. CB4, for example, is good about notifying residents with information about start dates for affordable housing applications in Chelsea and Hell’s Kitchen. An application, however, is just the beginning of the quest for an affordable apartment. It’s a lottery!

Launched in 2012, NYC Housing Connect (nyc.gov/housingconnect) offers current listings of addresses taking applications for affordable housing in all boroughs. (This is not the only way to learn about availability. You can call 311 and ask for the Affordable Housing Hotline, check local newspapers, even look for posters at construction sites.) An application can be submitted online or by mail if you feel that your household income and credit history meets eligibility requirements. (Often there is a fee of about $25 for a credit check.) Before the existence of NYC Housing Connect, the city relied on a labor-intensive paper process.

Some people searching for affordable apartments still use paper only applications and work through specific developers. A Catch-22 is that a lot of people who should be applying for affordable housing are poor and without computers, or seniors who lack computer skills. Some community boards either help with the application process directly, or send people to organizations that will help. The Actors Fund regularly schedules Finding Affordable Housing in NYC workshops to educate performing artists and others about the application process. Information can be found at actorsfund.org clicking on housing, or by calling its Housing Resource Center at 212-221-7300, extension 107.

There is still a lot of paperwork involved even if you do apply online. All eligible applications done through NYC Housing Connect are selected at random, in lotteries overseen by HPD, the New York City Housing Development Corporation (HDC) and New York State Housing Finance Agency (HFA), and given a log number based on order of selection. If your number is selected to move forward in the process, you will be invited to come to an interview with a packet of documents including a birth certificate, pay stubs, tax returns, proof of address and more. Then you may be selected to see an apartment or you may be on a waiting list and notified months, maybe a year or more later about an apartment.

Developers now hire service organizations such as Common Ground Community or the Settlement Housing Fund to take charge of the interview process. A property may have 200 applications or 40,000. “You’ve got to jump through a lot of hoops,” says Kalin. “It’s extremely tough, because maybe out of every 100 people who apply, one gets in, and the ratio may even be higher than that. Out of the thousands who apply, some people go onto a waiting list, and never leave it. I’ve been at HCC for 30 years and I have clients who have been on the waiting list for Manhattan Plaza the whole time.” In New York City, affordable housing is in great demand, and there is not enough supply. Are AMI levels leaving out the poorest citizens? We wait to hear what Mayor de Blasio will say in May.

Her Long Road to an Affordable Home
Connie Perry was one of the lucky ones. She sent in her application for an affordable apartment in July 2008. In winter 2009, Perry was asked to come in with all of her documents for an interview. She did as directed, but no apartment materialized. Then, since she is a freelance publicist and not salaried, every three months she had to go back to the developer with updated financials. She would go back and forth, on and off a waiting list.

“I was consumed with going to see them [Related Companies, the developer]. I got rejected but then I appealed it, and just before Thanksgiving 2011, they told me I could come and see an apartment and if I liked it I could sign the lease right then and there,” she says. “They never did say why they had rejected me, but I amended my projected income. It was the most stressful application process because quite frankly, there’s no way to know how they determine how you fit in.” It was three years after she had started her quest when she signed that lease for a large studio in a luxury building in Hell’s Kitchen. That’s a better story than her friend Tamu Favorite’s, who has been on her quest since 2005, has applications at 27 buildings and still has no lease. Sometimes she’s told she makes too much money, sometimes she hears it’s not enough.