Brooklyn Borough President

BOROUGH PRESIDENT'S TESTIMONY TO THE CITY COUNCIL HOUSING AND BUILDINGS COMMITTEE OVERSIGHT HEARING ON THE FUTURE OF MITCHELL-LAMA HOUSING IN NEW YORK CITY

“Good afternoon. Thank you Chairwoman Provenzano and members of the City Council’s Housing and Buildings Committee for this opportunity to testify at this very important oversight hearing concerning the future of Mitchell-Lama housing in New York City.

“I am deeply concerned about Mitchell-Lama building owners leaving or ‘buying-out’ of the Mitchell-Lama program, and how it is threatening to force thousands of moderate and middle-income Brooklyn residents onto the streets. Already, more than 6,800 units were removed from the program. Recent estimates suggest that an additional 1,800 units are at risk because owners have expressed their intent to leave the program. Without immediate help, the remaining units eligible for removal from Mitchell-Lama are in jeopardy.

“The ability of landlords to buyout of the Mitchell-Lama program is a huge blow to tenants and to our dwindling supply of affordable housing. 56,000 of these units are under the direct supervision of the Department of Housing Preservation and Development. In order to entice owners to keep buildings in the program, the administration has offered more than $31 million in Article 8A preservation loans if they agreed to stay in the program for the life of the loan, typically 15 years.
The mayor’s housing plan continues this commitment by including $50 million in HDC funds for Mitchell-Lama rehabilitation.

“These loans have typically been requested by co-ops, yet ignored by rentals. Without appropriate incentives, these rental units remain at risk. Most vulnerable are the 2,130 households in developments eligible to opt out who aren’t subject to rent protections. Without the extension of rent stabilization and elimination of vacancy decontrol, Mitchell-Lama rental households would be hit with huge rent increases.

“While lobbying efforts continue to improve legislation in Albany, there are crucial steps that can be taken by the administration to address the plight of Mitchell-Lama rentals. If preservation loan incentives are successful in extending the life of Mitchell-Lama co-ops, might there be a financial incentive that would yield the same success for rentals?

“Therefore, I strongly recommend that this committee hold a fact finding hearing with members of the administration, owners of Mitchell-Lama rental developments, especially those who already are planning on opting out and or have units not subject to rent protection, the Mitchell-Lama coalition and other financing experts as a way to assist in developing a viable financial incentive package to extend the life of Mitchell-Lama.

“I have spent my entire adult life fighting for more affordable housing, so I am acutely aware that each and every time an affordable Mitchell-Lama housing unit is lost, there is a huge social and economic price to pay. Thousands of families would not be able to afford homes they have lived in for years. The fabric of communities could be destroyed. We are getting a glimpse of a very bleak future if we don’t act right now. Brooklyn is already facing a crisis at the Middagh apartments. But this would only be the tip of the iceberg.

“In conclusion, renewing and strengthening the rent laws combined with enhanced Section 8 vouchers and attractive financial incentives will help the city preserve long-term affordability. These measures can offer an alternative for Mitchell-Lama owners other than leaving the program, thereby retaining this share of the city’s desperately needed affordable housing stock. I, along with Borough President Fields, will do everything in my power to make sure that we never close the door on Mitchell-Lama. Thank you.”