Q&A
Costs and funding sources for the Third Party Transfer (TPT) program
1:11:15
·
4 min
Council Member Pierina Ana Sanchez inquires about the costs associated with the Third Party Transfer (TPT) program, including legal expenses, personnel needs, and property stabilization costs. HPD Deputy Commissioner Kim Darga provides detailed information on the program's financial aspects, including tax collection, agency involvement, and various funding sources.
- The last round of TPT collected approximately $30 million in taxes out of $110 million owed
- Four agencies (HPD, Department of Finance, Department of Environmental Protection, and Law Department) are involved in administering the program
- Property stabilization costs were about $164,000 per unit in the last round, expected to increase due to inflation
- Funding sources include capital loans, tax incentives, and federal programs like Section 8
Pierina Ana Sanchez
1:11:15
So speaking speaking of those costs, can you just repeat a little bit about the cost of previous rounds of TPT?
1:11:25
So how much on the legal side, how much does it cost the city to bring a foreclose your action or what are the resources that HPD is dedicating to the action itself.
1:11:36
What are the personnel needs that the what would be the personnel needs to properly administer the program, and then this any numbers you can share on the cost of stabilizing properties?
Kim Darga
1:11:48
Sure.
1:11:49
So first off, I would say, this is a tax enforcement program, right, as well as a stabilization program.
1:11:57
Be because it is a tax enforcement program, we also do collect taxes as part of this program.
1:12:04
So in the last round of TPT, it was approximately $30,000,000.
1:12:11
So, you know, that certainly has an impact in terms of this abilities.
Pierina Ana Sanchez
1:12:18
Sorry, deputy commissioner, do you have the denominator of how much was owed?
Kim Darga
1:12:22
The last round at Star, the properties owed about a 110,000,000.
1:12:27
So just for context rate, we've talked about today, if we were to use the selection methodology in the draft legislation.
1:12:37
We would end up with properties that owe about $492,000,000.
1:12:41
So talking about a very significant amount of municipal debt.
1:12:47
So there are 4 agencies that are involved in administering the program that is HPD, the Department of Finance, Department of Environmental Protection, and the city's law department.
1:13:01
And there are a range of ways in which we invest resources.
1:13:06
Prior to transfer, we're coordinating to identify the qualifying properties.
1:13:11
There's a lot of data just sharing and analytics that is involved.
1:13:15
We're preparing legally legal filings.
1:13:17
We're doing outreach to owners and other interested parties.
1:13:21
We're fielding questions about payment and redemption.
1:13:24
We're submitting to city council for approval and coordinating with city council.
1:13:28
And we're also working to effectuate the foreclosure and manage any related litigation.
1:13:36
Upon transfer, we support the work that neighborhood restore is doing during an interim ownership stage.
1:13:43
And that has meant at times certainly allowing the fee and the budget that I talked about earlier, but it also has meant providing some money for emergency conditions during heat season.
1:13:56
Right?
1:13:56
We've had that come up from time to time.
1:14:00
And and then we are providing loans, tax incentives, and other assistance in order to stabilize the housing.
1:14:08
So as I mentioned, about a 164,000 per unit.
1:14:12
And capital in the last round, we would expect that would be higher in the future just based on inflation in the last couple of years, particularly in ongoing increases in costs.
1:14:23
And property tax exemptions on the residential side, as well as other assistance.
1:14:31
In the past, we've offered residents section 8 in order to help them not be rent burdened or maintenance burdened as part of the work that we're doing.
1:14:44
And we have allocated loan commencing tax credits to these projects as well.
1:14:51
So that there's a full range.
1:14:52
I mean, if you had questions, certainly DP and DOF are here.
1:14:56
So if there's more questions on the work that they do, we could talk about that.
Pierina Ana Sanchez
1:14:59
Yep.
1:15:00
And we'll have questions for them in particular.
1:15:02
For neighborhood restore, are we talking capital dollars, or are those coming out of the expense budget?
Kim Darga
1:15:08
So we have allocated CD or expense funding at times.
1:15:13
We have the money that is to cover the acquisition fee is typically capital.
1:15:22
So it's included in the capital loan that HPD provides to stabilize the housing.
Pierina Ana Sanchez
1:15:27
But the fee is expense.
Kim Darga
1:15:29
The No.
1:15:31
So we have provided expense or CDBG funding in the past.
1:15:35
But the main source is the fee that is in the development budget, and we generally use capital to cover that expense.
Pierina Ana Sanchez
1:15:44
Okay.
1:15:44
Thank you.
1:15:50
It's open around here.
1:16:01
Okay.
1:16:02
So in in previous rounds, Hi.
1:16:04
Deputy commissioner and and Ray Santiago.
