NYCHA isn’t getting a bailout — so its tenants should be getting buyouts

Senate Majority Leader Chuck Schumer’s bid for a Billion dollar bailout for New York City Housing Authority is dead the city’s biggest slumlordnotorious for failing to provide heat and hot water was to benefit from a “Schumark” — a $40 billion recovery fund to make up for decades of poor maintenance and excessive labor costs.

But Build Back Better is shelved, and Schumer’s earmark didn’t make it into the new Biden budget, which includes just $3.2 billion — no more than last year — to improve public housing across the country. That’s a lot less than that An estimated $40 billion alone that NYCHA needs for new roofs, boilers and sanitary facilities, among other things.

The city council is undeterred. A budget has just been proposed that would double spending on NYCHA and affordable housing, increasing it to $4 billion. But that’s still very close to what’s needed — and shows just how far out of reach it really is to bring the city’s public housing up to speed.

Memo to NYCHA: The cavalry is not coming. Nor is there any point in complaining, as Mayor Bill de Blasio would grumble, about the long-term “divestment” in public housing. The projects built to replace slums should be self-sustaining through rent and not dependent on endless subsidies.

Schumark’s death should not trigger a new round of begging. New York must finally face the fact that it’s time for drastic changes in the nation’s largest public housing system, a city within a city of 180,000 apartments. What is needed is not just the private governance that NYCHA leaders are pushing for, but a long-term plan to reduce public housing projects overall.

President Biden's new budget includes just $3.2 billion for public housing capital improvements.
President Biden’s new budget includes just $3.2 billion for public housing capital improvements.
Photo by Chip Somodevilla/Getty Images

Let’s give the tenants a chance to move out of this awful apartment.

It’s important to just keep in mind how bad NYCHA conditions can be. A snapshot of complaints as of March 31 shows 55 for lack of heating and hot water, 17 broken elevators and 63 gas and 10 power outages affecting thousands of residents.

This is on an ordinary day. And these don’t tell the tale of the infamous leaky roofs that cause all sorts of internal damage.

Nor do they tell the human story of dependency — the thousands of renters, mostly African American and Hispanic, who have lived in public housing for four decades or more, who have been denied the chance to own a unit or amass wealth while being forced to do so cope crime rate higher than the rest of the city.

There were small steps to improve physical conditions and management. The Rental Assistance Demonstration Program has brought private investment into the renovation and operation of some developments such as: B. the Baychester Houses in the Bronx, where there is a tenant guide described the new management as “miracles and blessings”.

But New York must do more and gradually and humanely withdraw from a failed socialist housing project that dates back to the La Guardia administration. That means selling public housing that sits on valuable development sites and using a portion of the proceeds to pay reparations to tenants who have suffered from the projects so they can afford to leave.

NYCHA's Ingersoll Houses near the Brooklyn waterfront would fetch a hefty price from real estate developers.
NYCHA’s Ingersoll Houses near the Brooklyn waterfront would fetch a hefty price from real estate developers.
Stephen Giovannini

NYCHA doesn’t just operate buildings – it sits on a substantial real estate fortune. According to the city’s Treasury Department, the total value of public housing is at least $7.1 billion and likely much more. Some NYCHA locations would charge high prices. Think of the sprawling Ingersoll project near the Brooklyn waterfront and residential developments in hip real estate markets like Park Slope, Bushwick and Fort Greene.

No, tenants cannot be forced to move out, but they can be paid to move out. There’s a better way: Compensating tenants for years spent in public housing, paying artificially low rents, but effectively being penalized for trying to increase their income because higher income would increase their rents .

The Lower East Side’s Jacob Riis Houses (1,191 apartments) are conservatively valued at $87 million. Just like I calculated manhattan institute, Selling the site would bring in enough for NYCHA to pay each tenant $58,000 and have $20 million left over. NYCHA would no longer have to pay to maintain the aging complex, and a buyout could be enough for a down payment elsewhere or a move out of state.

Such a drastic change cannot happen overnight. It could start with a survey of tenants to see if they would accept takeovers. After years of suffering in the cold and dark, many probably would.

The end of the Schumark should be a signal. The need for public housing in New York is too great for the government. It’s time to get out of business.

Howard Husock is a Senior Fellow at the American Enterprise Institute.

https://nypost.com/2022/04/04/nychas-not-getting-a-bailout-so-its-tenants-should-get-buyouts/ NYCHA isn’t getting a bailout — so its tenants should be getting buyouts


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