NYC Seeks Approval for Private Management of Housing
U.S. Officials Approve NYC Public Housing for Private Management
(Bloomberg) -- New York City will seek federal approval to move 62,000 public housing apartments into a $13 billion rent-subsidy program in the next decade, eliminating its reliance on government block grants that repeatedly fall short of financing maintenance of the largest U.S. public-housing system.
The U.S. Housing and Urban Development’s rental assistance demonstration program, known as RAD, changes how rents get paid, allowing investors to rely on predictable revenue from monthly rent vouchers guaranteed for 40 years instead of the uncertainty of annual federal budget appropriations. It has been used in Far Rockaway, Queens to renovate almost 1,400 units with $560 million in private and government financing. So far, it and two other complexes housing about 13,000 have been formally approved.
Under the program Mayor Bill de Blasio announced Monday, similar financing will renovate 62,000 apartments with new heating systems, elevators, roofs, kitchens and bathrooms and windows by 2028, affecting about 140,000 residents, more than 25 percent of the Housing Authority’s tenants. Maintenance will be provided by private managers. The city already had HUD approval to convert 15,000 units under the program.
“The city will need to go through the process of submitting financing documents for each of the developments it wants to convert, but there’s every reason to assume it will get approval within a decade,” said Tom Davis, director of HUD’s Office of Recapitalization, which runs the program.
Boiler breakdowns last winter deprived more than 300,000 residents of heat and hot water. City Comptroller Scott Stringer reported in July a repair backlog of 55,000 jobs, with safety violations taking an average of 370 days to fix. After finding conditions throughout the system deplorable, a federal judge ordered a monitor to oversee operations. Repairs and maintenance will require as much $31 billion, the Housing Authority has said.
To contact the reporter on this story: Henry Goldman in New York at hgoldman@bloomberg.net
To contact the editors responsible for this story: Flynn McRoberts at fmcroberts1@bloomberg.net, Michael B. Marois, William Selway
©2018 Bloomberg L.P.