New York City Aims to Build Affordable Housing in Wealthier Neighborhoods


New York City officials on Tuesday will unveil a plan to direct public money toward mixed-income housing projects in wealthier neighborhoods, a proposal aimed at addressing the lack of affordable housing and spur development after the year past a lucrative property tax exemption will expire.

Currently, the Department of Housing Preservation and Development uses city money to subsidize developments that contain only affordable housing. But under the new plan, officials would make money available for projects that have a mix of affordable and market-rate housing.

The hope is that revenue from high-rent, market-rate apartments will supplement city financing and allow for lighter public investment while producing more low-cost units than usual. Those units would also be in neighborhoods where affordable housing has not traditionally been built.

“It allows us to take advantage of our public resources,” María Torres-Springer, vice mayor of housing, economic development and workforce, said in an interview.

The proposal is an acknowledgment by the city that its traditional affordable housing tools have hit a wall.

A controversial New York state tax break known as 421a, introduced in 1971 but increasingly used by developers in nearly every large residential project in recent decades, expired last spring amid pushback from progressive lawmakers, who criticized it as a gift to the real estate industry. . Even the industry lobbying group, the Real Estate Board of New York, admitted that the program no longer met the city's housing needs, but it is unclear if or when a replacement program will be approved.

A separate federal program fueled by tax-exempt bonds has been stretched to its limit, city officials said.

The new plan is essentially a solution to overcome these limitations. The agency, which could implement the proposal without additional legislation, will first seek feedback from developers through February to see where and how it could be implemented. Jolie Milstein, president and CEO of the New York State Affordable Housing Association, called it an “innovative technique” that allowed the city “to build more affordable units in high-opportunity neighborhoods.”

The proposal is one of several ways local officials are responding to a deepening housing crisis.

For decades, not enough homes have been built in New York City to house everyone who wants to live there. As in other cities and states, the shortage has driven up housing costs and contributed to increasing homelessness.

But while states like California and Massachusetts have been addressing the housing shortage for years, New York state lawmakers have been left behind.

That has shifted the focus to New York City. The Adams administration is pushing zoning changes that could spur construction in many neighborhoods, but the changes require City Council approval. City officials are also trying to help people build basement homes and garage apartments.

Under the plan announced today, developers would apply directly to the city for subsidies. City officials would evaluate the projects based on how many units they create and how affordable those apartments are.

At least 70 percent of the apartments built under the plan should be “affordable,” although housing advocates have long criticized how that figure is calculated. To be considered affordable, the units would be restricted to certain income levels; For a family of four today, for example, the highest income allowed for these units would be almost $170,000.

At least 15 percent of apartments must be available to formerly homeless people. At least 7.5 percent more must be affordable for people with limited incomes: no more than $70,600 for a family of four, for example.

The projects could also receive tax exemptions, which would have to be approved by the City Council.

It is far from clear to what extent the new plan would address the housing shortage.

The idea of ​​subsidizing developments that include market-rate units may also prove controversial, with many in the progressive wing of the Democratic Party questioning how much public investment private developers should receive.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *