Gotham Gazette

The Place for New York Policy and politics

CITY

City

After Overstating Budget Deficits, Cuomo and De Blasio Get Big Federal Bailout


4 amazon gov corp

Governor Cuomo and Mayor de Blasio (photo: Ed Reed/Mayor's Office)


Governor Andrew Cuomo and Mayor Bill de Blasio have spent many months warning New Yorkers about cratering tax revenues because of the coronavirus pandemic, outlining yawning budget gaps that could force them to make drastic spending cuts to state and city services and lay off thousands of government workers. But while the fiscal future remains uncertain, their worst predictions did not come to pass — revenues were higher than expected and significant federal aid has flowed to New York, even as major direct funding to shore up state and local government budgets was elusive. And now that is set to change thanks to parts of an immense $1.9 trillion federal package that appears imminent.

Despite shifting evidence to the contrary even before the aid now moving through Congress, the governor and mayor have nonetheless presented doomsday scenario narratives and budgets for the next fiscal year as they have sought to draw the maximum amount of federal aid possible. Throughout the past months, since shortly after the state went into lockdown last spring, both Democratic leaders, especially Cuomo, have often exaggerated the budget deficits, underplaying the billions of dollars in federal aid that was already coming into the state and giving limited acknowledgement to the relative bright spots in revenue.

By all early indicators during the pandemic, New York State and City were bound to suffer. As the early epicenter of the outbreak, strict restrictions eventually went into place. Businesses closed, some for good, and unemployment skyrocketed (and remains high). It was the end of a honeymoon for the state’s and city’s economies, which had seen an unprecedented nearly decade-long streak of continuous growth.

But the state’s and city’s finances differ in one crucial way. The state is heavily dependent on personal income taxes for revenue, which seemed as if they would plummet as more than a million people lost their jobs, and the city largely relies on property taxes, which were expected to be relatively stable. The inverse occurred. As white-collar workers mostly remained employed and many upper-income earners actually saw their income increase, personal income tax collections were higher than most predictions, even surpassing the previous fiscal year, while in the city, property taxes are anticipated to fall by $2.5 billion in the next fiscal year, the largest drop in decades.

Currently, Congress is on the verge of finalizing passage of President Joe Biden’s $1.9 trillion American Rescue Plan, which includes $350 billion for state and local governments. After initial passage in the House of Representatives, then modifications and passage in the Senate, the package now goes back to the House for final approval.

Senate Majority Leader Chuck Schumer of New York celebrated the Act’s imminent passage on Sunday, outlining what he said is $100 billion in benefits it will deliver to New York, including $23.8 billion in fiscal relief funds for the state, localities, and the MTA. Of that, $12.5 billion in direct relief will go to the state government while another $6 billion will be sent to New York City alone. “The deal we reached with the help of a new president, and a new Democratic Senate marks real relief to the tune of $100 billion for workers, families, healthcare, small businesses, including our hard-hit industries like restaurants, and New York — the things we need to support in order to weather this crisis and then work to recover,” Schumer said in a statement. Much of the aid to New York will go do individuals, businesses, nonprofits, and other entities, while government entities are receiving roughly one-quarter of the sum.

Though it behooves both the state and city to extract as much as they can out of the federal government – after all, New York is a ‘donor state’ that sends more tax money to Washington, D.C. every year than it receives back in funding – fiscal experts warn that federal aid is being employed as a handy excuse for the state and city to avoid serious structural budgetary measures. Federal funding is also a bandaid on a wound that will take years to heal, they point out, and administrations at both levels still need to better prepare for an uncertain future that may include large budget deficits and no additional federal money to plug them.

The governor repeatedly made dire threats about cuts to services, particularly in aid to localities for health care and education, if the state’s $15 billion initial projected budget gap for the current 2021 fiscal year alone was not filled by federal aid. He withheld a chunk of funding and took other emergency fiscal measures given expanded powers he was granted by the Legislature, and even cautioned that the state could see a $60 billion gap over four fiscal years.

But, as revenues came in higher than expected and the state took other measures, including borrowing billions and reducing spending, that budget gap slowly whittled down. Cuomo’s $193 billion executive budget proposal in January estimated the gap at $4.7 billion for fiscal year 2021 and $10.2 billion for fiscal year 2022, which begins April 1 of this year, gaps later amended to $3.1 billion and $9.5 billion, respectively. Meaning the two-year budget gap sum dipped below the initial current-fiscal year estimated gap of $15 billion.

The governor’s office and the state Legislature even reached a new consensus on revenue forecasts for the 2022 fiscal year, projecting it would be nearly $2.5 billion higher than what the executive budget proposal expected.

Still, Cuomo has continued aggressively making a $15 billion demand from the federal government in direct aid for the state government. That amount would now be sufficient for covering the current fiscal year gap -- including repayment of the short-term debt it took on -- as well as the projected gap for next fiscal year, which begins April 1, though that number is expected to be significantly lower given all that has transpired, including ongoing covid vaccination and the likely impact of so much federal relief and stimulus across the state. Cuomo has even threatened to sue the federal government if it doesn’t deliver the total amount, though that appears to be off the table even as aid looks like it will come in below the $15 billion at about $12.5 billion.

Cuomo presented two scenarios in his executive budget. One where the state receives $6 billion in federal aid, necessitating major cuts, certain tax increases and potential borrowing in the billions. The second scenario would see the state receive the full $15 billion. “Revenues coming in higher than expectations is good news, but we're still contending with devastating revenue losses -- $17.5 billion over just two years -- caused entirely by the pandemic that we need the federal government to offset so we can continue to fund baseline services over two years,” said Freeman Klopott, a spokesperson for the State Division of Budget, in a statement. “These new revenues will be used to reduce revenue shortfalls and replace federal funding, which is a non-recurring resource."

Fiscal watchdogs say the governor’s misleading representation of the budget figures could be detrimental in several ways. In fact, the updated financial plan from his own state Division of Budget noted that assuming the state were to receive $6 billion in federal aid and takes the budget steps outlined, it will actually end the year with a $1.6 billion surplus, and a $676 million surplus in the next fiscal year.

“He has consistently distorted, inflated and twisted numbers,” said E.J. McMahon, founder and senior fellow at the Empire Center for Public Policy, a think tank. “He has totally obfuscated the true nature of the situation.”

McMahon noted that the governor’s rhetoric could backfire in two ways. “He's been inflating the number under the assumption that it impresses someone in Washington. I think we're well past the time where far from impressing anybody, it's annoying people in Washington, including Democrats,” he said. But more ironically, he said, the progressive left has also used the $15 billion figure and its resulting and potential cuts to services as a rhetorical cudgel against the governor and to push for the Invest in Our New York Act. The package of legislation would raise as much as $50 billion in revenue each year by establishing new and increased taxes on the ultrawealthy, corporations, Wall Street, inheritances and gifts, according to its proponents.

“That number is so preposterous, it normally would actually undermine your credibility right from the start,” McMahon said of the $50 billion projected revenue from the Invest in Our New York Act. “But [Cuomo] has thrown around like helium balloons the number $60 billion early on as the size of our deficit, which it never was...He's grossly exaggerated it and in some ways that exaggeration is feeding advocates of policies he claims to oppose.”

The main challenge, McMahon said, is the “immense structural problem” that will resurface after federal aid is expended. He said the state should have already been restraining spending last year rather than starting off on the wrong foot, when Cuomo and the state Legislature adopted a budget that was $10 billion higher than projected revenues, agreed upon in the depths of the spring covid outbreak, April 1, 2020, and amid many more unknowns than knowns.

It’s analogous to the Great Recession of 2008-09, when the state did not do enough to reduce expenditures even as it got by with federal aid, McMahon said. “Generally, what happened was Cuomo inherited a $10 billion budget gap when he took office a decade ago because the federal stimulus had gone away,” he said. “And they then had to deal with the shortfall that the recession had created, which they had not dealt with. They're now setting themselves up for the same situation.”

But the governor’s push for $15 billion also allows him a convenient alibi, McMahon said. “Ask for too much under the assumption that you’ll get more than you would have otherwise. And then because they won't meet your price, you could then blame them,” he said.

On Sunday, in a conference call with the press, Cuomo celebrated the federal help apparently on the way, but said tax increases on the wealthy would still be on the table despite the massive federal aid package. “The $12.5 billion is very, very helpful. But as you know, because I've said it 150 times, we needed $15 billion, in my opinion. So we do have a gap there and tax increases are on the table,” he said, continuing to avoid acknowledging the more positive reality of the state’s fiscal picture.

State Comptroller Tom DiNapoli last week urged the governor and Legislature to take steps in the budget to address long-term structural problems rather than pursuing short-sighted solutions such as deferring costs to future years and suspending statutory debt limits. “There are signs our economy is rebounding,” the comptroller said, pointing to robust growth expected for employment and wages in the next fiscal year, “and the federal government will soon provide aid to suffering New Yorkers and devastated communities. But this recovery is fragile, and I urge state leaders to consider the long-term impact of this year’s actions to avoid tougher choices later.”

While New York City also benefited from higher personal income taxes, its budget is heavily dependent on property tax revenue, which is expected to fall by $2.5 billion in the next fiscal year, beginning July 1, because of plummeting values of office buildings and hotels which have largely been empty since the pandemic hit.

That projected drop has raised the specter of budget gaps of more than $4 billion over the next three fiscal years that could be hard to cover without significant cuts.

Unlike the state, New York City is required by law to balance its budget with the revenues it expects to raise – the city cannot borrow for operational expenses like the state. The mayor’s $92.3 billion preliminary budget proposal for the fiscal year beginning July 1 manages to close a $5.5 billion gap with $2.7 billion in surplus from the current year, drawing $1.15 billion from reserves, and finding $1 billion in unspecified labor savings, among other measures. What it crucially does not include is any estimate of federal aid, which is all but assured and will likely mean that the mayor will have significantly more on hand to spend. There is, however, a risk of nearly $2.4 billion in cuts, reductions in expected aid, and cost shifts from the state.

When the city budget picture looked most dire, de Blasio had sought authority from Albany to borrow for operating expenses and threatened tens of thousands of city government employee layoffs. Neither turned out to be needed despite the mayor’s many please for the former and threats of the latter, even before the billions now apparently headed to the city’s coffers, in part because of the steps the mayor did take and the higher-than-expected revenues, as well as billions that flowed to the city from Washington to cover liberally-defined covid-related spending.

On Monday, de Blasio applauded the federal stimulus package. “Now we can finally start to imagine what a full recovery looks like because we have the missing piece,” he said. “Now, we have the one thing that was held back from us for months and months and months when it was needed most...So, this now supercharges our recovery. This is the thing we needed. So, that's tremendously good news. And we'll be talking about it more in the days ahead as we wait, of course, for it to be 100% signed, sealed, and delivered with the president's signature.”

The next phases of the discussion will likely be complicated and contentious, as the city and state decide exactly how to allocate the funding headed their way, budget for the here and now as well as the future, and try to advance policy goals that will also be the subject of debate.

“The real imperative is to use federal money wisely because we're not out of the woods and we've got a long-run problem,” said Andrew Rein, president of Citizens Budget Commission, a nonprofit fiscal watchdog group. He said the state and city should spend those funds on direct relief and costs stemming from the pandemic, while also using it to bridge gaps across future years and restructuring their finances. Otherwise, “we have the budget problem that is staring us in the face today, just another year or two down the road,” he said.

“Stabilizing the finances allows us to take care of New Yorkers over time and doesn’t just kick a bunch of problems down the road,” he added.

CBC has for years been calling on the mayor to identify deeper efficiencies and recurring savings at city agencies to restrain spending. But while the mayor has made some attempts at savings programs, even instituting a Program to Eliminate the Gap (PEG) last year and for the coming fiscal year, they have been criticized as insufficient by watchdogs like CBC, the City Council, and City Comptroller Scott Stringer.

In his analysis of the preliminary budget, Stringer pushed the mayor to strategically use federal funds to “jumpstart” the city’s economy and provide immediate aid to the neediest residents. Among his proposals were canceling rent, providing relief to undocumented immigrants, bailing out taxi drivers who are deep in debt, funding an emergency food program, and others. “The challenges of the pandemic and the economic crisis aren’t yet behind us. From a slowed economic recovery to a rocky vaccine rollout, our city still has a difficult road ahead,” he said in a statement. “We need to strategically use our long-awaited federal stimulus funds to rebuild and recover, and the most vulnerable New Yorkers that have been hit hardest must be centered in our recovery.”

At a Council hearing on the preliminary budget last week, Speaker Corey Johnson sounded a note of optimism. “This budget isn’t nearly as grim as I thought it would be. After the CARES Act, the second stimulus package, and now with the Biden Administration in the White House and the Democrats in control of the Senate—it looks like we’ll be getting the help we need,” he said.

But he also raised the concern that the city may not be responsible with federal aid. “I’m also concerned that this budget is going to take advantage of new federal money to just do the bare minimum,” he said, as he pushed the administration to find more savings while ensuring there aren’t cuts to essential city services. De Blasio and the Council must come to an agreement on the city budget by that July 1 start to the new fiscal year, and hearings on de Blasio’s initial spending plan are ongoing.

In essence, the fiscal crisis also presents an opportunity, said Nicole Gelinas, senior fellow at the Manhattan Institute. “We should be using this time to think about making ourselves more competitive, not just sort of saying, ‘Oh, yay, we got bailed out by the federal government and we'll just push these problems off for another year,” she said. She said the state and city should look for ways to reduce certain taxes – a temporary sales tax holiday, for instance – and to restore Midtown Manhattan as the core of the city’s businesses, or otherwise risk remote workers moving permanently to other states and jurisdictions.

***
by Samar Khurshid, senior reporter, Gotham Gazette
     

Read more by this writer.

Video Brief: Housing and the 2021 Election


video affo cons

Housing plans in motion (photo: Ed Reed/Mayoral Photography Office)


In the latest video brief on key issues facing New York City and at the center of the 2021 city elections, hosts Ben Max and Jarrett Murphy discuss housing, including the them es of housing development, neighborhood rezonings, affordable housing, homelessness, and NYCHA public housing. Watch:

Read more: Video Brief: Housing and the 2021 Election

Democratic Mayoral Candidates Talk Tenants and Housing


3 flcmc remarks

Housing (photo: Michael Appleton/Mayoral Photography Office)


Nine leading candidates vying for the Democratic nomination to be New York City’s next mayor appeared at a recent virtual forum to offer their stances on issues critical to tenants. Two-thirds of New Yorkers are renters, which means the forum provided candidates a crucial opportunity to impress a large and important group of voters with their policy ideas to solve the city’s housing problems, especially amid a pandemic that has exacerbated existing inequities.

At the February 27 forum co-hosted by tenants advocacy groups Tenants PAC, Tenants & Neighbors, and Met Council Action, the candidates discussed a range of tenant-centric topics, including rent stabilization, land use, NYCHA, code enforcement, homelessness, evictions, affordable and permanent housing, the shelter system, and more.

While candidates found some common ground on moving away from the city’s shelter system toward more permanent and affordable housing, as well as support for rent stabilization and reforming Mayor Bill de Blasio’s mandatory inclusionary housing (MIH) program, they varied on cancelling rent, how they would generate revenue, steps for improving NYCHA, and more.

Questions were posed by tenants and moderator Rachel Holliday Smith, a reporter with THE CITY, to participating candidates: Brooklyn Borough President Eric Adams, former federal housing secretary and city housing commissioner Shaun Donovan, former city sanitation commissioner Kathryn Garcia, former Wall Street executive Ray McGuire, former nonprofit executive Dianne Morales, city Comptroller Scott Stringer, Maya Wiley, a civil rights attorney and former counsel to Mayor de Blasio, and Andrew Yang, an entrepreneur and recent presidential candidate.

Several lightning rounds were embedded throughout the forum, in which candidates answered questions with only yes or no responses. In the first lightning round, candidates were asked if they were tenants, to which only Menchaca, Stringer, and Yang said yes. (Yang owns an upstate home where he controversially spent much of the worst months of the pandemic, but rents in his primary residence in Manhattan.)

Candidates were also asked if they were refusing donations from landlords and real estate developers. Adams, Garcia, McGuire, Wiley, and Yang said no, while Donovan, Menchaca, Morales, and Stringer said yes -- though Stringer’s answer to this semi-regular question was again qualified by him saying he’s no longer accepting money from “big” real estate developers, given he shifted his approach after previously raising money from real estate interests.

Asked if they would support a rent rollback or rent decrease for rent-regulated apartments via the city’s Rent Guidelines Board, candidates were divided in their responses. Adams, Donovan, Garcia, McGuire, Wiley, and Yang said no. Menchaca and Morales said yes. Stringer said he was “open to rollback in certain circumstances.”

Candidates were also divided on ‘cancelling rent and mortgages’ as a result of pandemic-era hardships and nonpayments. Adams, Menchaca, Morales, and Stringer said they were supportive, while Donovan, Garcia, McGuire, Wiley, and Yang said they were not. (It was not immediately clear what the specific definition of canceling rent and mortgages was meant to be in the question, so candidates appeared to assume it meant for everyone, while much of the policy debates surround taking such action for those who have been unable to pay due to loss of income as a result of the pandemic.)

Candidates unanimously agreed that the city’s affordable housing lottery was unfair. Since it was a lightning round, there was no discussion of how to fix it.

For the first longer question, candidates were unanimous in their support for rent regulation as a policy, but their explanations showed some differences.

Wiley and Yang voiced explicit support for an eviction moratorium during the coronavirus pandemic. “Their decision to freeze rents in 2020 was the right kind of move,” said Yang of the Rent Guidelines Board, a nine-member entity that oversees the rent stabilization system in New York City, including determining rent adjustments. “The people I would appoint would take a very similar tack,” he said, adding, “I’m also for an eviction moratorium ‘right to counsel,’” referring to ensuring free legal representation for those facing eviction, which the city has a version of.

Wiley and Adams both took personal approaches to the question. Wiley recalled what it was like to “watch my whole neighborhood displaced when landlords increased their rents, and I got pushed out,” and Adams attested of his childhood, “I know what it is to be on the verge of homelesslessnes.”

“We have to create rent subsidies,” Wiley said, likely meaning additional ones to the many that currently exist, while Adams suggested, “We could expand the Rent Guidelines Board to ensure that economists are on the board, as well, to help deal with the changing economics of our city.” Adams also cited his experience as a building owner, claiming he has never raised his tenants’ rents in more than a decade.

McGuire also voiced support for “supplementing the rent with rent subsidies,” then decried “rising rents” for “[driving] people out of their neighborhoods.” McGuire was the only candidate to suggest providing “support for the small building owners who are also small businesses,” citing his economic recovery plan that would in part provide financial relief options to small landlords.

In addition to Wiley, Donovan connected rent regulation to the homelessness crisis, saying “It's why I've entered public service to ensure that housing is central to people's lives.” Donovan and Garcia also acknowledged the impact of rent regulation on other aspects of tenants’ lives, with Garcia noting that stable affordable housing ensures “you have access to education, you are able to hold a job more easily.”

Morales and Stringer spotlighted their experiences as tenant organizers as evidence of their dedication to advocating for rent regulation. Morales emphasized her plans for sweeping reform; Stringer cited his “pro-tenant voting record” and legislative experience.

“When I was in the State Assembly, and the State Legislature tried to weaken the rent laws and they did that successfully, I was a lone voice to say ‘no’ and voted ‘no’ both in 1993 and 1997,” said Stringer.

“I think we need to guarantee housing for all in New York City,” said Morales. “We need to move toward making sure that rents are affordable for everyone, and that includes advocating and pushing for freezes around rent regulated apartments and also looking into what other reforms in the city Charter and outside the city Charter we can make to permanently protect our residents and our tenants and guarantee housing for everyone.”

Menchaca emphasized campaign finance reform in order to ensure that landlord and developer money cannot sway politics. Menchaca positioned himself as an enemy of real estate developers, saying, “As someone who has been constantly attacked by the REBNY forces, since I first ran in 2013, I can see that power.” He went on to add, “We need more pro-tenant structures that don’t require immigrants and others to have to fight every single time there’s going to be a vote, so that we can actually freeze rents, and I think that part of what we need to do is repeal Urstadt Law.”

Candidates unanimously pledged to appoint public members to the Rent Guidelines Board who would prioritize affordable rent over profits for landlords, with many citing their track records on affordable housing and community partnerships.

“Look, I probably testified to the Rent Guidelines Board more than most people for many, many years” and “you can see the data being manipulated on behalf of landlords,” said Stringer. He credited Mayor de Blasio “for leveling the playing field” for tenants and promised he would “appoint people with deep experience to advocate on behalf of tenants.”

Garcia concurred with Stringer’s point about data, saying, “We need to ensure that we are following the data and not getting manipulated regarding what the numbers show.”

Like Stringer, Donovan touted his record of “working with resident leaders across the city...to make sure that residents had a real voice in their communities,” citing his work on Via Verde, an affordable housing development in the South Bronx he helped create in partnership with community members when he was the city’s housing commissioner during the Bloomberg administration, and where he kicked off his mayoral campaign last year. Donovan also spotlighted his experience working “with tenant leaders like Damaris Reyes of Good Old Lower East Side and so many others around this city.”

Wiley cited her experience in the de Blasio administration, saying, “I was part of a team that ensured that Rachel Godsil was appointed to chair it [the Rent Guidelines Board] in 2014, which was the first instance in which we had the lowest [rent increases] because she was deeply committed as a civil rights attorney to making sure that what we were doing was preserving the rights of tenants and protecting housing.” Wiley connected this to her own experience as a civil rights attorney.

“I would go one step further,” said McGuire, “and make sure that you had appropriate representation for those New Yorkers who currently live in rent-regulated apartments.”

Morales and Menchaca both emphasized collaborating with community advocates to determine who their appointees should be on the Rent Guidelines Board.

“The public representatives of a rent guidelines board should be people who are impacted by the rent,” said Menchaca. He continued, saying, “I’ll also make sure that the landlords who are on this board are the landlords that represent the kind of landlords that we want in the city of New York, that can actually be sensitive to the tenant rights that often get pushed aside.” Menchaca said he is the candidate to fulfill these promises because he is a renter himself and his “leadership style” as a City Council member “has been in true co-governance, in movement with renters.”

Adams defended landlords of color who own smaller properties, like himself, pointing out, “Black wealth is tied in their real estate.”

“I think we need to really separate the micro apartments from the major apartments,” he said, rationalizing that if small Black building owners “lose that real estate, we will displace tenants, and you will see gentrification in the city. But he did not connect his point to the question of appointees to the Rent Guidelines Board.

Yang emphasized community engagement in his response, saying that tenants would have opportunities to speak with his public RGB member appointees “to tell them what’s going on in your communities because they will be there to serve you.”

In the next lightning round, all candidates unanimously agreed to boost code enforcement in all five boroughs; to support passage of Intro 146, a bill to increase CityFHEPS voucher amounts to reflect market rents in New York City; and to support passage of Intros 1104 and 1529, which would increase right-to-counsel income eligibility thresholds and expand the law to cover more eviction cases.

Holliday Smith then cited the de Blasio administration’s mandatory inclusionary housing program, which mandates at least 25% of units in new housing development that gets a density bonus be rent-regulated under certain affordability thresholds, which range significantly from affordable for very low-income to middle-income residents. The policy has been criticized for not being targeted more fully toward lower incomes and de Blasio’s implementation of it has been roundly panned because he has not pushed city-backed rezonings to make sure it is regularly utilized in wealthier neighborhoods, where it is designed to be used, and he has instead rezoned a series of lower-income communities of color, where MIH is far less effective and more city subsidies are needed to ensure lower-income housing, while also risking the acceleration of gentrification and displacement. Overall, the mayor’s housing plan has been criticized by many Democrats, including mayoral candidates, for not being more appropriately targeted to address the crisis of affordability, and therefore homelessness, faced by the city’s low and very low-income residents.

Asked how they would define affordable housing and what the goal income level should be for households to be eligible for affording housing, most candidates avoided specifying income in numbers, while also proposing different solutions for expanding affordable housing.

Stringer, Garcia, and McGuire were the only candidates to specify income brackets in their definitions of low-income housing, with Stringer and Garcia agreeing that it should be defined as “$30,000 for a family of three,” something Garcia also noted is included in her housing plan.

McGuire differed in his response, saying, “Deeply affordable housing is people making below $50,000.”

Morales, Adams, Donovan, and Menchaca did not specify exact figures but did agree that tenants should not pay more than 30% of their incomes on rent, generally the threshold used to determine if someone is rent-burdened.

Yang differed slightly, saying of what’s affordable that “We should be defining it [affordable housing] as 40 to 50% of median income, as opposed to the 70 or 80% that the developers would prefer.”

Menchaca cited his experience as a Council member, saying, “We were, as a community, able to get the apartments down to 30% of AMI [Area Median Income]. I think that’s deeply affordable in Sunset Park.”

Holliday Smith pressed Morales, Adams, and Wiley in particular to specify their views on the maximum income bracket to qualify for affordable housing, but they all declined.

“It depends on the family,” said Adams. “A family of four living in Park Slope is different from a family of four living in South Jamaica, Queens. It’s not clear cut and dry.”

Wiley said she would follow up with a specific figure as part of her yet-released housing plan. She spotlighted her $10 billion capital spending program, which would create 100,000 jobs and allocate $2 billion for improvements to NYCHA housing.

Yang noted that NYCHA “is some of the only truly affordable housing in our city,” adding, “We need to invest in that and actually make it something the city can be proud of.” He did not disclose how much he would invest in NYCHA.

Of his affordable housing plan, Stringer said, “I want to take the estimated 3,000 vacant parcels of land in the city — from vacant open space to a whole host of different areas, we've identified it — I want to give that land back to the people to community-based organizations to build the housing that we actually need.” He also reiterated one of his main housing plan planks: affordability caps for 25% of the housing in any new developments anywhere in the city.

“The single most important thing we need here is rental assistance,” said Donovan. “It's why I've been working with the incoming Biden administration on a proposal for universal voucher assistance.”

Both Morales and Garcia called for converting vacant office spaces, commercial storefronts, and hotels into affordable housing units. They stressed that it was something the city could accomplish immediately, as opposed to other housing reforms, which would require more time, though those conversions also take significant time.

Morales called for an overhaul of the mandatory inclusionary housing program, saying, “We need to move away from this speculative market that commodifies housing, that provides incentives and subsidies to developers and prioritize community development” via “eminent domain and community land trusts.”

Menchaca noted that affordable housing efforts should “[remove] any barriers to undocumnented immigrants” by investing money into “language access.”

At this point in the forum, Wiley and McGuire had to leave for other appointments, but said they would answer the remaining questions in writing, to be shared later.

Keeping in mind the current budget constraints as a result of the coronavirus pandemic, candidates were asked how they would pay for affordable housing and whether or not it should be prioritized. All candidates agreed it should be prioritized, but proposed different funding strategies.

Morales and Stringer said they would end the 421a tax abatement, which is controlled at the state level and Stringer called “a landlord giveaway,” and redirect that money toward affordable housing.

“We need to explore new taxes like the implementation of a land value tax, a vacancy tax — I know that involves going to Albany, but I'm ready to do that,” said Morales. She also called for taxing “landlords that are warehousing spaces for speculative reasons.”

Stringer noted that the city is expected to receive “about $5.6 billion in federal stimulus money,” which he said an unspecified amount could be used for housing. Lastly, he called on Albany to implement a wealth tax.

Morales and Menchaca voiced support for the Invest In Our New York Act, a package of tax increases estimated to raise $50 billion, with plans for investment for housing, as well as healthcare, education, and other sectors.

“We could actually bring $100 billion in the next four years to do things like pay for the $32 billion of deferred maintenance in NYCHA, actually bring a public bank, and finance affordable housing,” said Menchaca of the city’s capital budget.

Garcia called for moving away from the shelter system “which costs a lot and gives us very little back” in favor of building permanent housing instead.

“I've made a commitment along the lines of the recommendations of United For Housing,” said Donovan, referring to an affordable housing advocacy coalition of more than 80 organizations across the city, “to increase our capital commitment from the city by $4 billion...and to increase what we spend from the expense side to get to half-a-billion dollars a year on the city voucher program.”

Donovan again flexed his connections in Washington D.C., saying, “I’m best positioned of any of the candidates to win that help from D.C. given my deep experience.” He added, “We could get tens of billions of dollars for public housing if we access options through Section 8 that are available,” referring to the federal rent assistance program. “I propose creating a citywide inclusionary program and other steps, as well,” he briefly mentioned of other housing policy.

Adams decried upzonings in low-income communities, saying he would “upzone in affluent areas, where you have transit-rich communities, great schools, access to healthy food.” On funding, Adams said, “It’s time to spend our capital dollars. Interest rates are low. This is the time to build, not to cut.” He also again proposed selling NYCHA’s air rights for $8 billion in order to “make it more livable.” Lastly, he suggested “[investing] in new low-income home ownership, such as Nehemiah houses and the Mitchell-Lama program.”

While Yang did not propose specific funding strategies, he called for “relaxing some of the regulations on what housing units can look like” in order to convert vacant office and commercial spaces “and get people affordable housing right now instead of waiting for the developers to get their acts together after we improve the incentives.”

Just before the next series of lightning-round questions, Stringer left the forum to attend another event.

Asked if they would prioritize the conversion of hotels for unhoused New Yorkers, remaining candidates -- Menchaca, Garcia, Donovan, Adams, Yang, and Morales -- unanimously said yes.

Garcia then had to leave the event.

Asked if they would support rent control for commercial tenants and if they would help pass the Small Business Jobs Survival Act, candidates were more divided.

“Yes, I support some [commercial] rent control. I don't believe the act is the right way to do it. So, it's a yes and no,” said Donovan.

After some back-and-forth, Yang said no.

Adams said no.

Morales and Menchaca both said yes.

Asked if they would require that any housing built on public land be permanently affordable to low- and extremely low-income New Yorkers, Menchaca said yes, Donovan said yes, Morales said yes; and Yang and Adams said they would include moderate-income New Yorkers, too.

Candidates were asked if they support NYCHA ‘infill development,’ utilizing public housing land to build new private housing, though there are various proposals for what that housing would be like in terms of affordability, who would be able to access the units, and more.

Adams didn’t directly answer the question at first, calling for incorporating more technology into NYCHA, such as “QR codes on buildings to see the repairs” and “use drones to inspect rooftops,” as well as “[weeding] out the corruption and mismanagement.” After Holliday Smith pressed him for a more direct response, Adams said he is open to infill development on NYCHA land as long as NYCHA tenants are not displaced. He again mentioned the idea of moving current NYCHA residents into the new units created through the development, thus freeing up NYCHA space for new tenants -- though he didn’t mention it, some see this as a path to moving older NYCHA residents who live alone out of multi-bedroom apartments and into one-bedroom apartments so larger families can access the larger NYCHA apartments.

“I'm generally against this form of infill development. I don't think it solves the problem,” said Yang. “I think that a lot of the friction we're describing is because too many NYCHA residents don't feel like they have a say in how the land is being used, how their communities are being run. One of the things I proposed is that the NYCHA board, instead of being minority tenants, should be majority tenants.” But, he said, if NYCHA tenant leaders supported infill development, then he would consider it.

At this point in the forum, Adams and Yang had to leave in order to attend a rally related to the recent instances of anti-Asian violence.

Holliday Smith reiterated her question about infill development but also asked the remaining candidates about their stance on Rental Assistance Demonstration, or RAD, which has sparked debate, including in the mayoral race, based on the fact that it allows for private management of public housing developments.

Morales and Menchaca voiced their opposition toward RAD.

“I am not in support of private developments on NYCHA land,” said Morales.

Morales said she was supportive of “utilizing NYCHA properties and developments in order to further support the residents,” and only if residents are able “to self-determine how their land is used.” She listed urban farming developments, community land trusts, and workforce pipelines as some ideas of appropriate ways of utilizing NYCHA properties.

Citing NYCHA’s roughly $40 billion need to get to a state of good repair, Holliday Smith pressed Morales to explain how she would fund improvements for the housing authority. To this, Morales said she has committed $2 billion in funding from the city budget, as well as leverage additional funding from Albany and the federal level, but she did not cite specific programs to bring in revenue and expressed opposition to RAD and infill.

Menchaca said he would divert $3 billion from the NYPD’s budget. He also called the budget for the Department of Education “bloated” but did not say how much he would disinvest from it. Menchaca emphasized that any funding should come from the city first in order to galanvaze additional funding from Albany and the federal government.

Donovan took issue with those who equated RAD with privatization, saying, “RAD is shifting funding to Section 8, so that you can access far more funding and preserve public housing. It does not require privatization.” Donvan said, “I am open to partnerships with nonprofits and others,” he said, and he was adamant that public housing should be permanently affordable and public. “I am open to doing new development on NYCHA land that retains public ownership,” Donovan added.

“We need to fix NYCHA without accessing more federal resources,” Donovan said. “I would commit $2 billion a year of city capital,” in addition to Section 8, which “could get us to the $40 billion within a few terms.”

Asked how they would push for tenant protections in buildings that are being converted to private management under RAD, Morales and Menchaca said they would protect residents by stopping any shifts toward the involvement of private companies altogether.

In cases where privatization is already taking place, Morales said she was supportive of tenants’ ‘right-to-counsel’ to avoid eviction and “taking on those private managers who are attempting to circumvent the protections that were supposed to be made available to our tenants.” She said she would try to reverse any deals in place as soon as she took offices.

“I think what is happening is these programs are being implemented badly,” said Donovan, who pointed out, “If someone is eligible to live in public housing, they're eligible to stay with Section 8.” Donovan said that if private managers were failing to effectively protect tenants, then “I would take it back at NYCHA, and I would do it as a public process a hundred percent of the way through and ensure that we’re actually getting results.”

On homelessness, Morales reiterated her support for providing permanent affordable housing for all, which she proposed could be accomplished by exercising “eminent domain to get ownership of buildings that are financially distressed or just abandoned and transfer those things to community control.”

She called for moving away from the shelter system, calling it “a very expensive and ineffective model.”

Menchaca decried “the warehousing of our neighbors” in reference to the city’s shelter system and voice support for expanded rental assistance. “We also need to convert our hotel and commercial, empty spaces to permanent and supportive housing,” he said.

“We ended veteran homelessness in 80 cities,” said Donovan of his experience as HUD secretary under President Obama. “The way that we do that is reimagine our right to shelter in this city as a right to housing.” In addition to investing in permanent housing, Donovan called for the creation of a coordinated system “where every time someone leaves Rikers, leaves the mental health wing of one of our public hospitals, they are directed directly to the resources they need.”

Asked how they would ensure code enforcement among landlords, Donovan was the most specific, saying he “would create an early warning system that would ensure we’re targeting buildings,” including tenant-owned cooperatives. He said he “would revamp the J-51,” a tax incentive for building owners who renovate their buildings. Donovan also promised to “connect residents in those buildings to rental assistance much more effectively.”

Donovan and Menchaca said they would make sure the Department of Housing Preservation and Development exercises its power to make repairs in emergency situations.

Morales proposed “a sort of grading system for landlords that would impose increasing fines or penalties for folks who failed to do that [code enforcement].” She also called for “support services for tenants” to file reports and “advocate for their needs” but did not explain further.

***
by Allison Smith for Gotham Gazette
 @GothamGazette

Read more by this writer.



Print Friendly and PDF

Editor's Choice


Gotham Gazette: New York Voters Approve $4.2 Billion Environmental Bond Act
New York Voters Approve $4.2 Billion Environmental Bond Act
Gotham Gazette: 
New York City Voters Approve Racial Justice Ballot Measures
New York City Voters Approve Racial Justice Ballot Measures
Gotham Gazette: 
Housing Development in New York City Slows to a Crawl as Officials Debate Tax Incentives
Housing Development in New York City Slows to a Crawl as Officials Debate Tax Incentives
Gotham Gazette: 
City Council Examines Low Voter Turnout, Moving Local Elections to Even Years City Council Examines Low Voter Turnout, Moving Local Elections to Even Years