August has been a busy month in NY’s housing world. Last Friday Governor Spitzer signed a few bills that will improve the state’s flawed 421-a program, which provides tax breaks to developers who build affordable housing. Also last week, the City Council committed $14 million to help preserve federally-assisted affordable housing developments that are distressed (see this week’s City Limits for a good summary of both these events).  And earlier this month, the Governor signed a bill that will increase funding for New York City’s public housing, which I’d like to focus on here.

Public housing is one of the country’s largest sources of affordable housing. In New York, the New York City Housing Authority provides affordable housing for over 400,000 people. Many NYCHA tenants are working people and union members. AFSCME’s DC 37- one of the unions that represents NYCHA workers – has 15,000 members who work for or live in NYCHA apartments.

But, NYCHA is in a state of financial crisis. As Joe Lamport points out in Gotham Gazette on August 20:

Since the 1980s, significant cuts to the federal housing budget have caused problems for public housing in the city. Analysts estimate that the city government now receives only 83 cents for every dollar it needs to operate its federally financed buildings.  

The 1990s and early 2000s saw continued cuts to public housing’s funding by both the city and state. Now, despite the fact that the city and the state have dedicated millions of dollars to the housing authority in 2007, NYCHA will still face a deficit of about $225 million.

There have been a number of proposals to deal with the deficit including privatizing public housing, more maintenance cut backs and staff cut backs – NYCHA is proposing 500 lay offs for October 1. As far as I can tell, none of these will solve the problem and in fact, they will just make it worse.

Providing some relief, the Governor signed a bill earlier this month that will increase the shelter allowance for residents living in public housing – adding millions of dollars in funding to NYCHA annually. An August 14th editorial in the Daily News explains how this works:

Most NYCHA households pay about a third of their income for rent, but the 16% on public assistance have shelter allowances applied toward their rent instead. A typical family of four in a two-bedroom NYCHA apartment has a shelter allowance of $157 a month. The same family in a two-bedroom apartment in a privately owned building would have a shelter allowance of $450.

So the bill creates parity between public and private housing in terms of the shelter allowance assistance landlords receive. While this isn’t going to solve NYCHA’s financial crisis, it eliminates a needless inequality and certainly helps close the budget gap by adding millions in funding. The Governor received a lot of  pressure from community groups and unions to pass this bill and, although it remains to be seen what will happen with the layoffs, it is a good step forward for NYCHA residents and workers. We can only hope there is more to come.  

This post was written by Natasha Winegar. While Jonathan is away on vacation, she will be posting in his place.