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Discussion on the mayor's goal of creating 500,000 units of affordable housing
0:36:13
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Council Member Sanchez inquires about the mayor's moonshot goal of creating 500,000 units of affordable housing over the next decade, specifically asking what share of this target will be financed by HPD through the capital budget. Commissioner Carrión emphasizes the importance of partnerships and explains that HPD's direct contribution is a small part of the overall goal.
- Carrión highlights the need for state and federal partnerships to achieve the housing goals
- He mentions that HPD typically produces 10-12,000 new construction units and 20-25,000 total units (including preservation) annually
- The discussion touches on the importance of public-private partnerships and the need for a new tax incentive to replace the expired 421A program
Pierina Ana Sanchez
0:36:13
But my first question is regarding the mayor's moonshot goal of creating 500,000 units of affordable housing of housing over the next decade.
0:36:23
This date has not yet passed major housing enabling legislation, as we just highlighted.
0:36:28
Meanwhile, the housing vacancy survey does reveal that the vacancies in New York City are at historic lows with less than 1% of apartments renting at at prices under $2400 per month.
0:36:41
HPD's capital budget is the key place in city funds to create this urgently needed affordable housing And so I I want to ask the question of, you know, what what are we talking about here in terms of the mayor and the administration's perspective, when where public dollars are involved.
0:37:01
What share of the 500,000 units, new new homes target will be financed by HPD through the capital budget.
Adolfo Carrión Jr.
0:37:09
Thank you, Adam Chair.
0:37:12
And I'm glad you started your remarks and preview to your question sort of emphasizing emphasizing the notion of partnership because I think that is clearly what it's gonna take.
0:37:31
And when I referred to that partnership in in my prepared remarks, you'll see you saw there that I talked about the state and the federal government as partners in this process.
0:37:46
If we step back a little bit and look at the whole pie.
0:37:50
And maybe just for a moment, think about the conversation that has taken place as we've been climbing out of this pandemic into a post pandemic economy, this recovery.
0:38:04
The governor offered a bold 800,000 for the state.
0:38:12
New York City is the economic engine of the state.
0:38:16
And the global city in in America.
0:38:20
And so our share of that 800,000 is a half a1000000 units.
0:38:26
And you could almost say it's half a 1,000,000 units at a minimum that we need to keep this economy thriving and to keep that open invitation to the world to come here and participate in the global city.
0:38:40
So when you when you look at that whole pie and there are many estimates, you know, there was a lot of traffic and a lot of conversation around 500,000 units?
0:38:53
And is it 400,000?
0:38:55
Is this 600,000?
0:38:57
A ballpark 500,000 units that would allow us to keep up with popular relation of growth and stay competitive is a responsible target for our city to set.
0:39:07
And I I just wanna recognize the mayor's leadership in that conversation.
0:39:14
Our share of that 500 is a thin slice as is our production of housing in the New York City in the normal cycle without a 500,000 unit goal.
0:39:27
We've got 2,000,000 apartments right now in New York City in the rent stabilized and free market universe.
0:39:37
We've talked about the amazing vacancy rate that we're facing.
0:39:43
If you estimate the number of units that we are able to produce just with the city resources, with subsidy, with the low income housing tax credits that are available to us that are very limited.
0:39:59
We we do about anywhere between 10 and 12,000 new construction units every year, and about 20 to 25,000 units of total new construction and preservation of existing housing.
0:40:20
Last year, we had a banner year.
0:40:24
A lot of that production leaned on, a tax incentive, half of the new construction, just about half of the new construction numbers, the record 14227 was a result of a public private partnership back to the theme of partnership.
0:40:45
We've seen a severe drop off in in new permits for construction.
0:40:51
As a result of this the sun setting of of that public private partnership tax incentive for affordable housing.
0:40:59
So we need to make sure that gets restored, and you you you you kind of referred to a menu of of of legislation and other tools that we're trying to employ to address this crisis.
0:41:15
Whether it's commercial conversions, whether it's lifting the SAR, whether it's legalizing basements, and there's hundreds of thousands of New Yorkers who that we're, you know, guesstimating, live in basements, that are in dangerous conditions that have no rights and no supports.
0:41:38
We need to to do that But one of our most important tools is this public, private partnership.
0:41:45
It's been the most productive, public, private partnership for creating affordable housing anywhere in the country.
0:41:52
It's a model that has been replicated in other municipalities around the country.
0:41:57
And and so the question for us this year is, can we get the leadership from the state legislature and the signals that I hear are good signals.
0:42:14
We were up there last week, twice.
0:42:17
I was encouraged to see some of your colleagues, members of the city council still walking the halls asking for support for New York City, which is great.
0:42:28
It was the SOMO's caucus weekend.
0:42:31
They were members of the city council up there talking about housing.
0:42:35
We need all of these tools to be able to produce more housing.
0:42:40
The city of New York cannot do it alone.
0:42:43
So we're gonna need our our our state and federal partners to pitch in far more.
0:42:48
And, you know, I talked a little bit about what the federal government can do to help us in that regard.
Pierina Ana Sanchez
0:42:57
Oh, it's still on.
0:42:58
Great.
Adolfo Carrión Jr.
0:42:59
And no feedback.
Pierina Ana Sanchez
0:43:01
No feedback.
Adolfo Carrión Jr.
0:43:02
Good.
Pierina Ana Sanchez
0:43:02
And then I was in whispering other things that I should've been thank you thank you commissioner.
0:43:06
I mean, to to extrapolate and and sort of simplify, but but please correct me if if this is not a fair summary HPD's HPD can finance close to well, you had a record 14,000 new construction Yep.
0:43:24
Financed in the last year in extrapolate that and maybe put a little buffer, we're talking about a 120,000 publicly financed affordable units out of the 500,000, would that be fair to say?
Adolfo Carrión Jr.
0:43:36
If if you do that simple math, yes.
0:43:39
However, I would not want to attach myself to that number because my hope is that with a new tax incentive, we get more private investment coming into more neighborhoods and high cost areas of the city that allow New Yorkers the fair housing choice opportunities that they need via the more deeply affordable housing opportunities that they need.
0:44:01
If we unleash the federal side of this with the low income housing tax credit, you know there's that 50% test that I think everybody knows now what it is.
0:44:13
I heard I heard at a public meeting somebody talking about the 50% test, and it was just like a regular person from the crowd.
0:44:21
Right now, we have an opportunity to reduce that to 30%.
0:44:25
It's in the tax in the bill.
0:44:29
If we're able to do that, it's going to unleash thousands of units, at least 44100 in the next 2 year cycle.
0:44:36
Just multiply that over several times.
0:44:41
We also have launched some initiatives that are yet to be tested.
0:44:46
I think at one of your hearings, if I remember correctly watching from a distance, we talked about the mix income market initiative, which is a tool with no tax credits.
0:45:01
And it's a a new idea.
0:45:02
We're looking for new ideas to build affordable housing even without the tools that we have.
0:45:09
We want to let the market do some of that.
0:45:12
And and that program would be a 70% affordable, 30% market the 30% market would help to cross subsidize the 70% affordable.
0:45:25
So everything is on the table, and I wanna be able to say that we can have a bigger share of the half a1000000, but it's gonna require a lot of tools and a lot of creativity.
Pierina Ana Sanchez
0:45:37
Thank you.
0:45:37
Thank you, commissioner.
0:45:39
I wanna note that last time that 421A expired in 2017.
0:45:43
We saw a similar phenomenon where construction starts and permit applications and all of that did grind to a halt.
0:45:51
As soon as the state government re upped 421A, we we saw a bounce back.
0:45:56
You know?
0:45:57
So I I do wanna just state that as a as a caution to make sure that we get it right, to make sure that the the policy is the right policy to deliver the affordability that we need as a city, and not not just a policy see that is rushing to, you know, incentivize any construction.
0:46:12
It's the the kind of construction.
0:46:13
We should pay for the kind of construction that we need to see.
0:46:17
Thank you.