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Committee on Public Housing

Faizah Malik, Counsel
Guillermo Patino, Senior Legislative Policy Analyst
Jose Conde, Legislative Policy Analyst
Sarah Gastelum, Senior Legislative Financial Analyst

Briefing Paper of the Infrastructure Division
Matt Gewolb, Legislative Director
Jeffrey Baker, Deputy Director, Infrastructure Division
Hon. Ritchie Torres, Chair
Oversight The NextGeneration NYCHA Development Plan
January 26, 2016


On January 26, 2016, at a New York City Housing Authority (NYCHA) development,

Holmes Towers, the Committee on Public Housing, chaired by Council Member Ritchie Torres,
will hold an off-site oversight hearing entitled The NextGeneration NYCHA Development
Plan. Those invited to testify include NYCHA and interested members of the public, including
public housing advocates and residents.1

Background on NYCHA and Public Housing

Former New York City Mayor Fiorello La Guardia created NYCHA in 1934 three

years before the advent of federal public housing.2 NYCHA originally served two purposes: (1)
to provide low-cost housing for middle-class, working families temporarily unemployed because
of the Depression and (2) to bolster the lagging economy by creating jobs for the building
trades.3 Later, NYCHAs purpose evolved into providing safe, decent housing for families with
the lowest incomes.4
Today, NYCHA has 328 developments, 2,553 buildings, and 177,666 public housing
units, making it the largest public housing authority in North America. 5 NYCHA also
administers Section 8 affordable housing vouchers for 88,467 apartments.6 All told, NYCHA
serves a community of 607,399 people, roughly the population of Boston.7

Residents and tenants are used interchangeably throughout the briefing paper.
Peter Marcuse, The Beginnings of Public Housing in New York, Journal of Urban History 12(4) at 353-54 (1986);
see also NYCHA Housing Developments, La Guardia & Addition, available at
http://www.nyc.gov/html/nycha/html/developments/manlaguardiaadd.shtml (last accessed Sept. 12, 2013).
Marcuse, 353-54; J.A. Stoloff, A Brief History of Public Housing, Paper presented at August 14 meeting of the
American Sociological Association, at 3 (2004).
Marcuse, 354; Stoloff, 1; see also Judith D. Feins, et al., Revised Methods of Providing Federal Funds for Public
Housing Agencies, US Department of Housing and Urban Development, at 9 (1994).
See NYCHA Fact Sheet (as of March 1, 2015), available at


NextGeneration NYCHA
A. Impetus for NextGeneration NYCHA
On May 19, 2015, Mayor de Blasio and NYCHA Chair and Chief Executive Officer

Shola Olatoye announced NextGeneration NYCHA (NextGen), a ten-year plan to stabilize

the financial crisis facing New York Citys public housing authority and deliver long-needed
improvements to residents quality of life by changing the way NYCHA is funded, operated and
how it serves its residents.8 According to NYCHA, due to underfunding by all levels of
government, NYCHA faces nearly $2.5 billion in a cumulative projected operating deficit over
the next ten years, and nearly $17 billion in unmet capital needs for major infrastructure repairs.9
NYCHA expects that over ten years, the plan will both produce a cumulative operating surplus
of over $200 million and reduce NYCHAs capital needs by $4.6 billion.10
One of NextGens key strategies, which will be discussed in further detail below and is
the focus of this hearing, is to provide underutilized NYCHA-owned land to support the
creation of affordable housing units.11 All of those affordable housing units will count toward
Housing New York: A Five-Borough, Ten-Year Plan (the Housing New York plan), Mayor
de Blasios plan to build or preserve 200,000 units of affordable housing.12 According to press
reports, NextGen calls for around 17,000 units to be built on 50 to 60 sites over ten years.13

See NYCHAs Final Agency Annual Plan for 2016, at 12 available at

See NextGeneration NYCHA, at 1, available at http://www1.nyc.gov/assets/nycha/downloads/pdf/nextgen-nychaweb.pdf.
See Housing New York: A Five-Borough, Ten-Year Plan, available at
See Laura Nahmias, NYCHA selects Wyckoff Gardens, Holmes Towers for new development, POLITICO New
York, (September 9, 2015), available at http://www.capitalnewyork.com/article/city-hall/2015/09/8576366/nychaselects-wyckoff-gardens-holmes-towers-new-development.

NextGen states that all new development activity will include a transparent resident engagement
process and will bring improved amenities for existing residents.14
B. NYCHAs Development Plan
1. 2013 Infill Development Plan
NextGen is not NYCHAs first attempt to develop on underutilized NYCHA land. In
December 2011, NYCHA released a five-year strategic plan, entitled Plan NYCHA: A
Roadmap for Preservation, which included an imperative to develop new mixed-use, mixedincome housing and resources.15 In September 2012, NYCHAs former Chair, John Rhea,
announced that NYCHA had undertaken a comprehensive review of NYCHAs real estate
footprint with a goal of offering NYCHA-owned property for the development of market rate
and affordable housing, and, in some cases, commercial, retail, and community facilities.16 The
former Chair said the review showed that NYCHA could generate hundreds of millions of
dollars and create thousands of new market-rate apartments and at least 1,000 permanently
affordable apartments.17
At the end of January 2013, NYCHA announced its infill development plan to lease up
to 18 sites at eight different Manhattan developments to private developers.18 Those
developments were: Baruch Houses, Campos Plaza I and II, Carver Houses, Douglass Houses,
LaGuardia Houses, Meltzer Tower, Smith Houses and Washington Houses.19 NYCHA stated


See NextGeneration NYCHA, at 11, available at http://www1.nyc.gov/assets/nycha/downloads/pdf/nextgennycha-web.pdf.

See Committee Report from the City Councils April 5, 2013 Public Housing Committee hearing on
Preconsidered Resolution 1719-2013, entitled Resolution calling upon the New York City Housing Authority to
engage its residents in planning for and to include certain requirements in any ground leases for NYCHA land,
available online at legistar.council.nyc.gov.
Id. (citing speech of NYCHA Chairman John B. Rhea to Association for a Better New York on September 24,

that it targeted sites (1) in neighborhoods with relatively high rents; (2) where NYCHA has
development rights and there is excess floor area; (3) where no demolition would be required;
and (4) where the site was not deep within a development campus.20 NYCHA outlined its plan as

The sites identified contained mostly parking lots, trash yards, and an old community
center. NYCHA said it would relocate the parking spaces before construction began;

The sites would be leased to private developers who would build mixed-income housing,
creating 80% market-rate apartments and 20% affordable apartments. There would be a
total of 4,300 new apartments, and 860 of them would be affordable;

The private developers would have to build enhanced security systems for existing
developments where the new buildings would be located. The developers would also
have to install an electrical generator system in each new building capable of providing
emergency power to the surrounding campus;

The plan would generate $30 million to $40 million annually for NYCHA; and

There were other viable sites at other developments that NYCHA wanted to lease in the
NYCHA intended to ground lease the sites to private developers for 99 years. 22 Under

the ground leases, NYCHA would retain ownership of the land, but allow developers to build on
the land. In February and March 2013, NYCHA began presenting its plans for each development
to residents and resident leaders and, after substantial pressure from elected officials, posted
details of its plans online.23
However, due to strong opposition from NYCHA residents, advocates and elected
officials, particularly around issues of community engagement, NYCHAs plan did not move
forward in its proposed form. During his campaign, then-candidate de Blasio opposed the infill
plan, but conceded that there may well be a development plan that is believable and acceptable,


but it has to be carefully constructed. So I certainly dont rule it out. 24 Shortly after taking
office, Mayor de Blasio shelved the 2013 infill plan and began to craft his own affordable
housing plan.
2. NextGen Development Plan
There are two components to NYCHAs current NextGen development plan: (1) the
affordable housing plan and (2) the 50/50 plan.25
a. Affordable Housing Plan
Under the affordable housing plan, NYCHA plans to use underutilized land at public
housing developments to build 10,000 new, affordable housing units, including a mix of uses to
provide additional amenities, which will achieve a projected ten-year revenue of $100 to $200
million.26 The 10,000 units will account for 12.5% of the new construction goal of 80,000 units
outlined in the Housing New York plan.27 NYCHA intends to partner with the Citys Department
of Housing Preservation and Development (HPD) and the Housing Development Corporation
(HDC) on the planning, development, and ground leasing of its sites.28 NextGen states that
new development sites will be underutilized, street-facing areas currently used as parking lots,
trash areas, or storage sites.29 New development will be subject to the following conditions: (1)
no displacement of existing NYCHA residents; (2) efficient building footprints; and (3)
new buildings will not block sight lines between front doors of existing NYCHA buildings and
the public sidewalk.30 In addition, NextGen states that NYCHA will identify sites based on


Greg B. Smith, Bill de Blasio slams NYCHA leadership, Bloomberg, vows big changes, N.Y. Daily News, (October 10, 2013),
available at http://www.nydailynews.com/news/politics/bill-de-blasio-slams-nycha-leaders-bloomberg-article-1.1481369#ixzz2kSC2yokA.
See NextGeneration NYCHA, at 11, available at http://www1.nyc.gov/assets/nycha/downloads/pdf/nextgennycha-web.pdf.
Id. at 84.
Id. at 85.

proximity to neighborhoods of planned City rezonings, and ability to leverage other public
investments.31 Based on the preliminary analysis in NextGen, NYCHA estimates that it has at
least 11 acres of potential development sites throughout the five boroughs to support the
construction of 10,000 affordable housing units. Additionally, NextGen states that the new
development will include a mix of uses, where possible, as well as units sized for smaller
households, such as senior households, with the goal of creating homes for all NYCHA residents
while freeing up currently under-occupied units for larger households in need.32 Any revenue
generated by the affordable housing plan would be reinvested into the adjacent developments
and the Authority itself.33
NYCHA began resident outreach for the first three sites in summer 2014 Ingersoll (Fort
Greene, Brooklyn) in Council Member Cumbos district, Van Dyke (Brownsville, Brooklyn) in
Council Member Mealys district, and Mill Brook (Mott Haven, the Bronx) in the Speakers
district. According to NYCHA, these developments were selected because they are located in
neighborhoods that are the focus of the Housing New York plan and have vulnerable
populations, high capital needs, and as-of-right development opportunities. NYCHA worked
with community based organizations, New York Communities for Change and Community
Voices Heard, to facilitate resident engagement sessions termed community visioning
sessions by NYCHA at the three developments. At the community visioning sessions,
residents were asked to envision how to improve [their development], identify places in the
neighborhood that worked and that did not, express ideas and concerns in open mike sessions,



and vote on community priorities.34 According to NYCHA, the goals and priorities identified at
the community visioning sessions informed the development plans at the three sites.35
NYCHA released a request for proposals (RFP) jointly with HPD for the three sites on
July 1, 2015.36 The proposed developments will be 100% affordable, which is defined as
affordable37 to a household earning 60% of the area median income (AMI) or less, or $46,620
for a family of three, and NYCHA notes that it will seek to reach households at lower AMI
levels through Section 8 vouchers.38 According to the press release, NYCHA will retain rights
to the land developed through a long-term ground lease, provide critical oversight to the project,
require developers to train and hire NYCHA residents, and proactively engage residents on a
regular basis as the project moves forward.39 Additionally, the units built will be rent stabilized
and NYCHA residents will have a preference for 25% of the units.40 HPDs Marketing
Guidelines will dictate the tenant selection process.
At Ingersoll, the RFP seeks a developer to build senior housing on the site of an unused
grass area, and the developer will be required to propose plans to create a first floor community
space for residents and the surrounding NYCHA community.41 At Van Dyke, the RFP seeks a
developer to build units for families on the site of a current parking lot. 42 Finally, at Mill Brook,
the RFP seeks to build senior housing on the site of an accessory parking lot, and the developer


See e.g., Ingersoll Houses Vision Summary, available at http://www1.nyc.gov/site/nycha/about/nextgennycha.page.

PROPOSALS IN BROOKLYN, BRONX: City Seeks Partners to Create Affordable Housing Units at Ingersoll, Van
Dyke & Mill Brook Developments for Seniors and Families, (July 1, 2015), available at
Affordable means the rent for an apartment does not exceed 30% of a households income.

will be required to propose plans for a first floor senior community center and identify a partner
to operate the center and services for seniors.43
As of this hearing, NYCHA plans to build 150 units at Ingersoll, 225 units at Van Dyke
and 125 units at Mill Brook. Proposals were due on September 30, 2015, and NYCHA is in the
process of selecting the winning bidder(s) now.
b. 50/50 Plan
Under the 50/50 plan, NYCHA intends to build around 7,00044 mixed-income units on
underutilized, high-value sites.45 Fifty percent of the new units will be affordable to
households making no more than 60% of AMI, and fifty percent will be market rate.46 The
development will achieve a projected ten-year revenue of $300 to $600 million, which would be
dedicated to improvement projects in the adjacent development and to ensuring the Authoritys
financial sustainability.47 According to NYCHA, residents at the 50/50 sites will have the
opportunity to set the priorities for making capital improvements at their developments, such as
new roofs, brickwork and kitchen and bathroom renovations.48 NYCHA has told tenants that it
intends to lease the land to developers for a 60 year term, after which NYCHA will pursue
another 60 year lease to ensure affordability and land rights. 49 As with the NextGen affordable
housing plan, NYCHA will release an RFP jointly with HPD, new units will be rent stabilized
and NYCHA residents will receive a preference for 25% of the new units. Additionally, HPDs

NextGen does not include an estimate of the number of 50/50 plan units. This number was reported later in the
press. See Laura Nahmias, NYCHA selects Wyckoff Gardens, Holmes Towers for new development, POLITICO
New York, (September 9, 2015), available at http://www.capitalnewyork.com/article/cityhall/2015/09/8576366/nycha-selects-wyckoff-gardens-holmes-towers-new-development.
See NextGeneration NYCHA, at 12, available at http://www1.nyc.gov/assets/nycha/downloads/pdf/nextgennycha-web.pdf.
Id. at 85.
See Frequently Asked Questions 50/50, available at http://www1.nyc.gov/assets/nycha/downloads/pdf/5050faqs-en.pdf.
See Frequently Asked Questions Holmes Towers, available at

Marketing Guidelines will dictate the tenant selection process. However, NYCHA has stated that
the financing of the project, which will be determined through the RFP process, will ultimately
dictate the exact community preferences and affordability levels.
In September 2015, NYCHA announced that the first two sites for 50/50 development
will be Holmes Towers (Upper East Side, Manhattan) in Council Member Kallos district and
Wyckoff Gardens (Boerum Hill, Brooklyn) in Council Member Levins district.50 NYCHA
expects to build around 1,000 units at these sites.51 According to press reports, some of the
revenue generated by the 50/50 development will be reinvested into the apartments at Wyckoff
Gardens and Holmes Towers, and the rest will be funneled to NYCHA for improvements at other
complexes.52 However, NYCHA has not disclosed how much revenue it expects the proposed
developments to generate.53 As reported in the press, city officials said they selected Wyckoff
Gardens and Holmes Towers because [b]oth sites include large tracts of available, underused
land, have a high need for capital repairs and are located in neighborhoods badly in need of
affordable housing . . . . and are likely to generate the maximum amount of revenue from
developers interested in building market-rate homes.54
At Holmes Towers, NYCHA officials told the press that the two current buildings cover
just 16.2% of the land, and an area the size of three football fields is left underutilized.55
NYCHA plans to construct a single mixed-income building with 350 to 400 units, of which 175
to 200 would be reserved for affordable housing.56 According to NYCHA, development at


See Laura Nahmias, NYCHA selects Wyckoff Gardens, Holmes Towers for new development, POLITICO New
York, (September 9, 2015), available at http://www.capitalnewyork.com/article/city-hall/2015/09/8576366/nychaselects-wyckoff-gardens-holmes-towers-new-development.


Holmes Towers will be as-of-right, meaning that no zoning changes will be necessary and
NYCHA does not intend to go through the Citys Uniform Land Use Review Procedure
(ULURP) for the project. NYCHA estimates that Holmes Towers will need about $47 million
in capital repairs over the next five years.57
At Wyckoff Gardens, NYCHA officials told the press that the three current buildings take
up just 12.3% of the property, leaving 5.1 acres, or the equivalent of seven football fields, of
underutilized space.58 NYCHA plans to construct an underdetermined number of mixed-income
buildings with 550 to 650 units, of which roughly 225 to 325 would be affordable. Unlike
Holmes Towers, NYCHA has stated that a zoning change will be necessary at Wyckoff and it
intends to go through the ULURP process with the developer once the developer has been
selected. NYCHA estimates that Wyckoff Gardens will need about $45 million in capital repairs
over the next five years.59
Resident and stakeholder engagement at Holmes Towers and Wyckoff Gardens began in
September 2015, and will include community visioning sessions similar to the affordable
housing plan, but community based organizations are not facilitating these sessions this time. At
the resident meetings, NYCHA intends to discuss tradeoffs with residents; that is, NYCHA
will discuss the risks of building (or not building) market rate housing on public housing land.
NYCHA has stated that the feedback compiled will be used to inform the RFP, which will be
released in the first quarter of 2016.
C. Public Concerns
Tenants, advocates and elected officials have voiced a number of concerns with the
NextGen development plan, which include:



Resident engagement process. Although NYCHA has been meeting regularly with

tenants at the NextGen development sites, some residents feel that NYCHA is moving too
quickly.60 Some residents are concerned that the resident meetings are false pretense and that
the key decisions have already been made without sufficient resident input.61

Affordable housing. Residents are concerned that the level of affordability at the new

developments will not be deep enough to allow current NYCHA tenants to qualify. 62 As a
comparison, the average family income in public housing is $23,311, 63 whereas 60% AMI for a
family of three is $46,620.

Maintenance needs at existing developments. Residents and elected officials are also

concerned about market rate housing being built before needed repairs at existing NYCHA
buildings are made.64

Quality of life issues. The sites identified so far include green spaces, parking lots and

playgrounds. Residents and elected officials are concerned about the loss of such spaces.65
Residents have also expressed concerns about the impact of construction noise and dust on the


See Daniel Fitzsimmons, Walkout During Housing Meeting, New York Press, (October 9, 2015), available at
http://www.nypress.com/local-news/20151009/walkout-during-housing-meeting; see also Nikhita Venugopal,
NYCHA Tenants Rally Against Plan For New Mixed Income Housing, DNAinfo, (November 18, 2015), available
at www.dnainfo.com/new-york/20151118/boerum-hill/nycha-tenants-rally-against-plan-for-new-mixed-incomehousing.
See NYCHA Fact Sheet (as of March 1, 2015), available at
See Greg B. Smith, EXCLUSIVE: NYCHA tenants fear de Blasio's plan for pricey rentals on their grounds will eventually force them
out, N.Y. Daily News, (September 13, 2015), available at http://www.nydailynews.com/new-york/exclusive-nycha-tenants-upset-de-blasiorental-plan-article-1.2358328; see also Shaye Weaver, Residents Fume Over City's Plan to Build High-Rise on Top of UES
Playground, DNAinfo, (September 14, 2015).
Id.; see also Shaye Weaver, Residents Fume Over City's Plan to Build High-Rise on Top of UES Playground,
DNAinfo, (September 14, 2015), available at https://www.dnainfo.com/new-york/20150914/upper-eastside/residents-fume-over-citys-plan-build-high-rise-on-top-of-ues-playground.


quality of life of existing residents and the possible reduction of light and air once the new
buildings are constructed.66

Impact on neighborhoods/gentrification. Residents have expressed concerns about the

impact of increased density on local schools and infrastructure.67 Residents are also concerned
about the potential displacement of local commercial and retail establishments due to an influx of
higher income residents.68 Additionally, although NYCHA has stated that rents will not increase
and current tenants will not be displaced, there remains a concern among tenants that both will

HUD Approval Process

Before leasing public housing land, NYCHA must comply with Section 18 of the United

States Housing Act of 1937 and its accompanying regulations and must submit an application to
the U.S. Department of Housing and Urban Development (HUD) showing that each of the
criteria described below have been satisfied.70 NYCHA has stated that the Section 18 application
process will not begin until after developers have been selected through the RFP process.

Justification. NYCHA must demonstrate that ground leasing is in the best interests of its

residents because either (1) the land to be leased exceeds the needs of the affected
developments or (2) leasing the land will not interfere with continued operation of the
remaining portion of the development.71


Id.; see also Holmes Towers Visioning Results, available at

Id.; see also Holmes Towers Visioning Results, available at
Nikhita Venugopal, NYCHA Tenants Rally Against Plan For New Mixed Income Housing, DNAinfo, (November
18, 2015), available at www.dnainfo.com/new-york/20151118/boerum-hill/nycha-tenants-rally-against-plan-fornew-mixed-income-housing.
See e.g., Holmes Towers Visioning Results, available at
See generally 24 C.F.R. Part 970.
24 CFR 970.17.


Resident consultation. The leasing plan must be developed in consultation with the

Resident Advisory Board, affected residents, and affected resident organizations. NYCHAs
application must include copies of any written comments NYCHA receives and its evaluation of
those comments.72

Consultation with the Mayor. NYCHA must consult the Mayor and summarize that

consultation in its application. The application must also include a signed and dated letter of
support from the Mayor.73

Estimate of fair market value. NYCHA must provide the fair market value of lease sites

based on an independent appraisal.74

Costs and proceeds. NYCHA must provide an estimate of the gross and net proceeds it

expects from the leasing plan. NYCHA must also provide a list of estimated costs.75 After HUD
approves and NYCHA leases the sites, NYCHA must show how the proceeds were spent.76

Environmental review. NYCHA must conduct an environmental review of the leasing


Board approval and inclusion in Annual Plan. NYCHA must show that it described the

leasing plan and timetable in its Annual Plan. NYCHA must also show that its board approved
the leasing plan.78

No violation of orders or consent decrees. NYCHA must show that its leasing plan does

not violate any court orders, consent decrees, or other agreements.79


24 CFR 970.9(a).
24 CFR 970.5 and 970.7(a)(4).
24 CFR 970.7(a)(9).
24 CFR 970(a)(10).
24 CFR 970.35(a).
24 CFR 970.7(a)(15) and 970.13.
24 CFR 970.7(a)(1) and (a)(13).
24 CFR 970.7(a)(16).



Today, the Committee plans to examine NYCHAs NextGen development plan in detail.

While resident engagement is underway and an RFP has been released for the affordable housing
sites, there are still a number of details about the plan that remain a mystery, such as the timeline
for development, possible financing models for the projects, how NYCHA will allocate the
revenue generated, and the proposed structure of the development deals. Additionally, NYCHA
has stated that it plans to develop at 50 to 60 sites, but has not released the names of future
development locations. The Committee expects to emerge from the hearing with a clearer sense
of those details. Additionally, the Committee is interested in learning about the resident
engagement process thus far and how it could potentially be improved upon for future sites.
Finally, given the potential impact of the plan, the Committee is particularly interested in hearing
the concerns and opinions of NYCHA residents and the public-at-large at todays hearing.