Bart Schwartz Must Trust Big Ideas to Save NYCHA
With almost 400,000 residents in nearly 175,000 apartments and 2,300 buildings, the New York City Housing Authority (NYCHA) houses more people than major cities like Pittsburgh, Tampa or Cleveland. The largest public housing system in the United States, NYCHA provides affordable housing for one in 22 New Yorkers, but the reality for most residents is grim.
The agency is plagued by an aging housing stock and an inability to make repairs due to staggering underfunding. These failures have resulted in the federal government stepping in with a monitor now responsible for NYCHA’s future. But preserving the agency’s housing stock, providing safe, decent housing, and averting crisis should be our collective goal—and that requires major changes and big ideas.
According to NYCHA’s 2017 Physical Needs Assessment (PNA), the projected costs for the agency’s total capital repairs are $31.8 billion—or $180,000 per unit. The 2017 assessment represents a 93 percent increase from 2011, when the total need reached $16.5 billion.
Given the aging housing stock and the current rate of deterioration, the federal monitor, Bart Schwartz, has tough decisions ahead as the long-term viability of most NYCHA units is uncertain. If needs continue to grow at the same rate, the next PNA will identify more than $60 billion in funding needs and over half of the portfolio will cost more to repair than to replace.
Schwartz’s eventual path forward for NYCHA must aim to slow the rate of deterioration, achieve a state of good repair and fill in the necessary funding gap.
To begin, the monitor must find ways to streamline procurement and construction processes. Schwartz must immediately declare a “state of emergency” and remove regulatory roadblocks to expedite repairs and renovations for which funding is already allocated. Currently, NYCHA procurement is burdensome and increases the time and cost of capital work, which discourages many qualified firms from bidding on projects.
Second, NYCHA must shrink its portfolio. The U.S. Department of Housing and Urban Development should encourage the practice of converting developments that are isolated or costly to operate into permanently affordable Section 8 units either through the Rental Assistance Demonstration or the use of Tenant Protection Vouchers. This could reduce NYCHA’s portfolio to 100,000 units.
Third, NYCHA must capitalize on their estimated 80 million square feet of unused development rights. If NYCHA sells 10 percent of its development rights at an average price of $250 per square foot, it could raise $2 billion for capital needs.
Fourth, NYCHA can expand its infill program, allowing mixed-use, market-rate and Mandatory Inclusionary Housing developments, generating significant revenue. NYCHA controls more than 110 million square feet throughout the five boroughs, space equal to all of Manhattan below 14th Street. However, due to their “tower in the park” design, with large setbacks and sprawling campuses, buildings take up only about 20 percent of that total land area. The remaining land is designated for parking, pathways and green space that is often underutilized and fenced off. Funds generated from infill development would go directly to the adjacent NYCHA buildings with the goal of building 20,000 new units on NYCHA sites, raising $2.5 billion for capital needs.
Finally, officials should use a three-phased redevelopment for buildings near obsolescence. This would mean first building new affordable housing on NYCHA land, allowing residents to move into the new building and then demolishing the dilapidated old buildings, allowing for new construction. In addition to raising money for capital funds, redeveloping NYCHA’s superblocks could be used to increase the supply of affordable housing, restore the street grid and provide space for ground-floor retail and community facilities.
If one third of NYCHA apartments deteriorate to unlivable conditions, 130,000 people—the population of New Haven, Connecticut—would be displaced. NYCHA residents are active community members who are employees and business owners themselves, and the economic impact of losing some and displacing others would be devastating for New York City.
As the federal monitor reviews the agency from top to bottom, it is important that he also reviews the portfolio and takes decisive action. Any path forward will require coordination from all levels of government, and most importantly, resident input. The time to wait is over. The time for bold changes at NYCHA is now.
Carlo A. Scissura is president and CEO of the New York Building Congress.