TESTIMONY
Adam Roberts, Policy Director for the Community Housing Improvement Program (CHIP), on Concerns with the New J51 Tax Abatement Program for Rent-Stabilized Buildings
2:09:01
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166 sec
Adam Roberts from the Community Housing Improvement Program (CHIP) testifies that the proposed new J51 tax abatement program will be ineffective for most rent-stabilized buildings due to restrictive requirements.
- The program requires owners to certify tenants' incomes, but owners cannot mandate tenants to provide salary information.
- The area median income (AMI) eligibility bands of 20-80% AMI are too low for rent-stabilized units.
- Even with government assistance, the 15-year regulatory agreement requirement is overly restrictive.
- A one-time tax abatement does not address the core issue of rent-stabilized buildings not generating enough revenue to cover operational costs.
Adam Roberts
2:09:01
Thank you for holding this hearing today.
2:09:03
I am Adam Roberts, policy director for the community housing improvement program, also known as Chip.
2:09:09
We represent New York's housing providers, including apartment building owners and managers, We appreciate that the council is advocating for J 51 in large part because of the financial crisis hitting rent stabilized housing.
2:09:21
Rent stabilized housing represents 40% of rent stabilized rental housing in the city, which is around 1,000,000 units of housing.
2:09:29
However, we have strong concerns that this new J51 program will not be usable for most buildings with rent stabilized units.
2:09:35
Most glaringly, the bill requires that owners certify the income of tenants in order to qualify that for the program.
2:09:42
Owners cannot mandate that their tenants provide updated salary information.
2:09:46
Without this information, there's no means of proving that tenants fall within the necessary AMI marketing dance to qualify for J51.
2:09:54
Even if the legal rents fall into those bands.
2:09:57
The AMI bands themselves are also overly restrictive.
2:10:01
The bill requires at least 50% of units in a building rent within affordability bands from 20% of 80% of AMI.
2:10:08
To 30% of 80% of AMI.
2:10:11
For a single person, this range is $17,392.
2:10:16
To $26,088.
2:10:18
This would mean that affordable rents would be around $500 per month.
2:10:23
No rent stabilized building could operate with rent solo.
2:10:26
The average operating cost for rent stabilized unit is $1164.
2:10:32
With the rents required to qualify for this new J51, a building would need to be losing $664 in at least half of its units.
2:10:40
While there is a substantial government assistance option to qualify, this too is overly restrictive.
2:10:46
The definition of government assistance is a regulatory agreement of at least 15 years.
2:10:51
This means that accepting voucher holders or having a shorter term regulatory agreement would still not allow a building to qualify.
2:10:58
Even if this program were better designed, it would not solve the structural problems causing the financial crisis in rent statement.
Sharon Brown
2:11:05
Your time has expired.
2:11:06
Thank you.
Pierina Ana Sanchez
2:11:08
Adam, do you wanna conclude?
2:11:09
Go
Adam Roberts
2:11:10
You are.
2:11:11
Too many.
2:11:11
Many 1,000,000,000 of dollars in investment, far more than what J50 or any government program would provide are needed to improve rent stabilized housing.
2:11:19
For instance, Nitro requires $80,000,000,000 to improve its 180,000 unit which is less than a fifth the number of rent stabilized housing.
2:11:27
The only way to fix rent stabilized housing is to ensure revenue exceeds operating costs.
2:11:31
And this means regular influxes of revenue, whether from tenants or the government, must be provided, and operating costs must be reduced.
2:11:38
A one time tax abatement will not solve the problems that these buildings have, that they do not earn enough revenue to operate.
2:11:45
Again, thank you for holding, sir.
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Sharon Brown, Member of the Public, on Concerns Regarding Housing Requirements, the Treatment of Undercover Public Servants, and Underpayment across Professions
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Edward Yaker, Chair of the Coordinating Council of Cooperatives, on the Critical Need to Reauthorize the J51 Program for Affordable Housing Cooperatives
