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Cover Story: Uphill Battle To Brake the Slide of 590 Parkside, the deplorable state of the city-owned building at 590 Parside Avenue in Brooklyn by Bernard Cohen.
Other stories include Susan Baldwin on tenant management plans being formed for city-owned buildings; Fred Ringler and Ron Webster on the victory of Northside, Brooklyn residents in forcing the city to keep its fire company; Susan Baldwin on city and federal government fighting over the responsibility of the first year's allocation of funds for a five-year federal subsidy program for housing rehabilitation; Brief profiles of staff members Barbara Pachecho and Jose Garcia; Bernard Cohen on the oncoming simplification of community management through a new computerized payroll system; Bernard Cohen on the potential of the National Consumer Cooperative Bank.
Cover Story: Uphill Battle To Brake the Slide of 590 Parkside, the deplorable state of the city-owned building at 590 Parside Avenue in Brooklyn by Bernard Cohen.
Other stories include Susan Baldwin on tenant management plans being formed for city-owned buildings; Fred Ringler and Ron Webster on the victory of Northside, Brooklyn residents in forcing the city to keep its fire company; Susan Baldwin on city and federal government fighting over the responsibility of the first year's allocation of funds for a five-year federal subsidy program for housing rehabilitation; Brief profiles of staff members Barbara Pachecho and Jose Garcia; Bernard Cohen on the oncoming simplification of community management through a new computerized payroll system; Bernard Cohen on the potential of the National Consumer Cooperative Bank.
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Cover Story: Uphill Battle To Brake the Slide of 590 Parkside, the deplorable state of the city-owned building at 590 Parside Avenue in Brooklyn by Bernard Cohen.
Other stories include Susan Baldwin on tenant management plans being formed for city-owned buildings; Fred Ringler and Ron Webster on the victory of Northside, Brooklyn residents in forcing the city to keep its fire company; Susan Baldwin on city and federal government fighting over the responsibility of the first year's allocation of funds for a five-year federal subsidy program for housing rehabilitation; Brief profiles of staff members Barbara Pachecho and Jose Garcia; Bernard Cohen on the oncoming simplification of community management through a new computerized payroll system; Bernard Cohen on the potential of the National Consumer Cooperative Bank.
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JUNE I JULY 1978 VOL. 3 NO.5 UPHILL BATTLE TO BRAKE THE SLIDE OF 590 P ARKSIDE - MABEL KELLY. "It's just patch-up 590." by Bernard Cohen Mabel Kelly, 59, covers her white lamps hades with plastic to protect them from the soot that blows so thick into her apartment that she sometimes thinks her building is on fire. Downstairs, the mustard colored- wall of her son James's kitchen looks two-toned from the neat line marking the upper limits of where he has cleaned off the grime. Approximately one third of the 40 units in the city- owned building at 590 Parkside Ave. in Brooklyn are occupied. In March it had 57 outstanding housing code violations. A fire last November left a 50-square-foot hole in the roof that gobbled snow all winter and went unrepaired until May when James Kelly and two other tenants fixed it themselves. There was no heat or hot water for weeks during the cold season and a recent visitor to the four-story brick building saw a notice that said the boiler was "tempor- arily" out of service again. Plaster falls from apartment ceilings and broken windows seem to stay broken. The intercom has not worked in years. "It's just patch-up 590," says Mrs. Kelly, shaking her head and laughing. Is this another New York City building down the drain? Not to the tenants and others who are familiar with 590 Parkside. It is certainly no paradise, but to them it is a prime building to be saved. Why? "It's a beautiful building," Rev. John Powis, who has known the building for years, said, referring to its structural soundness and potential. "And it' s in a section where there is no such thing as a vacant house or building. " All the other buildings on the block, which straddles Crown Heights and Flatbush, are occupied and properly maintained. Across the street from 590 is an elementary school. One block away there are some beautiful private homes and the subway; two blocks away are busy commercial streets. Since neighborhood deterioration often begins with one bad building, rescuing 590 would contain the blight and stabilize the block, Powis and others argue. Letting the building continue to slide could doom the area as the infection spreads. "It is an absolute disgrace for the Department of Real Estate (which has managed the building for two years) and HPD (Department of Housing Preservation and Development) that for so many years it has seen an almost perfect building on a perfect block and not done anything," Powis said. Mrs. Kelly and other tenants at 590 say they have fared no better under two years of city management than they did during the last years when the building was privately owned. Many of the units are in terrible shape, they say, and some tenants have moved without permission into more livable apartments in the building. A number of residents are putting their rent into a bank account from which they intend to finish paying for the fuel they bought themselves last winter. Some tenants are paying rent to DRE and others pay no rent at all. Nevertheless, the tenants successfully pressured the city to remove their building from the auction block last February. They feared that it would be bought by a "slumlord" who would milk the building for rents while skimping on maintenance and service. The last private owner of the building, J&B Realty, was forced to give up the property after the city success- fully sued him for failure to maintain the premises, according to Powis. At the end of March, the local Prospect Lefferts Gardens Neighborhood Association assigned an energetic organizer, Ronald Lewis, to the building. Earlier, the tenants had applied for admission to the community management program in which HPD con- tracts with community-based organizations to manage city-owned property. That application was supported by Rose Brown, director of HPD's Preservation Office in Crown Heights. Lewis said that one of his first tasks was to report to the tenants the disappointing news that HPD had rejec- 2 James Kelly pointing to where there was a gaping hole in his roof all winter. He and two other tenants repaired it themselves. ted their building because the city estimated that reha- bilitation would cost $8,OOO-a-unit or $3,OOO-a-unit more than the maximum allowed under the program. To complicate matters, while Powis, PLGNA and others were trying to get HPD to waive the regulation HPD auditors suddenly began questioning some book: keeping practices of the Crown Heights Management ~ o r ? , the only logical community management organ- IzatIOn for 590. There were a number of questions, but the probe into $446.50 in rent monies not properly accounted for threw CHMC's community management contract into limbo for two months. Finally, on June 22, HPD auditors cleared the organization, apparently assuring continuation of the management contract. Michael Nobles, executive director of CHMC, charged that the city had overreacted because of past fiscal problems in the community management program and had not given him the chance to address the bookkeeping questions before threatening his contract. "There were some legitimate questions," Nobles said, "but the way HPD addressed them was not." He said HPD should be more sensitive to the likelihood that innocent problems are bound to show up at the community level where expertise is not always readily a.vailable. "I think they are more interested in trying to fmd someone stealing and pull out all the stops and say, 'We found this,'" Nobles said. "It seems that the Playing ball in the entrance to S90 Parkside Ave. (HPD) staff is not as concerned with the program as they are with playing cops." Nobles said Crown Heights would like to take over management of 590 Parkside but that it depends on whether HPD will admit the building into the program. Bob Moncrief, who heads the community manage- ment program at HPD, said he will recommend that the rehabilitation spending limits be waived for 590. He said HPD will take another look at the building to see if the work can be scaled down closer to $7,000 to $7,500 per unit. Charles Raymond, HPD deputy commissioner for property management, has instructed his staff to pre- pare a list of all the buildings deemed suitable for waivers. Turnover at 590 remains rapid as a result of the conditions. Many people apparently do not realize how 3 grim things are until after they move in. Frances Holmes arrived last April rather than get assigned to a welfare hotel. She says she is still waiting for a refrigerator that works. Few if any tenants have lived in the building as long as Mrs. Kelly, who came in about 1966. "This building was well kept then," she said. "The super was very nice." James Kelly, who is 30, said, "The tenants were beautiful. They looked out for each other. There was no trouble at all." Mrs. Kelly and a number of other tenants interviewed all agreed that the residents of 590 would resume paying their rent once services were restored to the building. Then, said James Kelly, 590 will be "a city within a city. It will be like a castle. It is very important to come home to something. " 0 SIMPLE TENANT MANAGEMENT PLAN DEVISED FOR CITY-OWNED PARCELS by Susan Baldwin One month after the city acquired the first group of some 25,000 buildings expected to be taken in tax fore- closure this year, community housing groups have won an agreement to test a simple management plan that gives major responsibility to the tenants. "A few months ago, I don't think anyone who has been working on this In Rem problem would have thought that we would be getting so much coopera- tion, " said Adina Johnson, Manhattan borough director of Operation Open City and a member of the In Rem Task Force, a coalition of community housing activists and elected officials. The city expects to be ready to sign interim manage- ment agreements with some tenant and community groups by mid-July, according to Charles Raymond, deputy commissioner for property management in the Department of Housing Preservation and Development (HPD). HPD, which takes over responsibility for city- owned multiple dwellings from the Department of General Services (GSD) on September I, is working with GSD during the transition period. "We have to develop a mechanism . .. to halt the potential In Rems . .. We have to go to the banks to get loans to keep this 'redlining' from happening . .. " The streamlined, simplified interim agreements are to be based on models prepared by Lawrence McGaughey, a Brooklyn lawyer, on commission from the Fund for the City of New York; and by the In Rem Task Force, which has already identified 26 buildings on Manhat- tan's Upper West Side, Harlem, East Harlem, and Brooklyn for the proposed interim agreement program. "I am very hopeful about the interim lease agree- ments," said Raymond. He denied that pressure from community groups hastened his involvement in the In Rem plans. "My door is open," Raymond asserted. "About 30 different groups have started to meet with me and I think that's great. .. I am absolutely 100 per cent convinced we can't do anything without community people. I think this is the only way this particular [In Rem] situation can be solved. " The GSD assistant commissioner for the Division of Real Property (DRP), Perry Soskin, supported Ray- mond's view. "We are working on the interim lease format right now, and plan to sign off with the groups," he ex- 4 plained. "We also will allow [Article] 7A administrators to continue who are affiliated with community law services. " Soskin and Raymond have submitted a draft interim lease agreement to City Corporation Counsel Alan Schwartz, who is expected to rule on it by early July. Although details of the agreement are not yet public, it is likely that qualified tenant or community groups would manage the buildings with much the same authority as that exercised by Article 7 A administrators. Such groups would have power to rent apartments, collect rents, and, under a waiver from the Corporation Counsel, institute dispossess proceedings for non-pay- ment of rent. They would disburse funds from rental income to maIntain the buildings, purchase fuel and utility service, and make repairs according to a schedule negotiated with the tenants and the city. The groups would account to the city for income and expenses, probably in more detail and with greater frequency than is required of Article 7 A administrators by the Housing Court. While acknowledging the need for the interim tenant management, Soskin worried about the future. "We have to develop a mechanism . . . to halt the potential In Rems ... We have to go to the banks to get loans to keep this 'redlining' from happening," he added. Soskin reported that a special task force of high-level city officials is going to work to keep more buildings from going into tax foreclosure. Led by Deputy Mayor Lee Oberst, the group includes GSD Commissioner Peter Smith, Finance Commissioner Harry Tishelman, and Deupty Mayor Herman Badillo. Other observers agreed that the In Rem properties must be seen as a long-term problem. Douglas White, who recently left HPD's division of evaluation and compliance to become District Manager of Manhattan's Community Board 9, said, "The major problem that is being avoided is ownership of these parcels ... People have to realize that the city has taken a holiday in that it is willing to deal with management but not with ownership." White predicted that the tenants who ultimately "inherit" the buildings from the city in some form of sale will be unable to meet the property taxes without "massive rethinking of the tax structure and how it relates to this problem." Contemplating interim management, Adina Johnson was also thinking about restructuring-in this case, of rents. She warned that many tenants, particularly senior citizens, will not be able to pay the rents that result, for j ) example, from community-management-type rehabili- tation. "The tenants really should do the rent restructuring," J o h n ~ o n asserted. The city has agreed, she reported, to permit a tenant managing agent to request a rent restructure. HThe major problem that is being avoided is ownership of these parcels . .. People have to realize that the city has taken a holiday in tha.t it is willing to deal with management but not with ownership. " Asked to explain financial plans for tenant manage- ment of the In Rem buildings, Soskin said, "Most of the tenants have not asked for money to manage the build- ings ... Most of them seem to prefer getting control of the buildings 'as is,' with the idea of deciding later on about future plans." Johnson said that Soskin's main concern in negoti- ating with tenant groups over interim agreements 'has been to insure their compliance with three requirements: 1) ~ h a t they maintain liability insurance for the prop- erties; 2) that they attend a management course at HPD's division of evaluation and compliance; and 3) that they maintain proper books, records, charts, and accounts. Meanwhile, Soskin revealed that 50 In Rem buildings around the city, selected for their strategic importance to the blocks where they are located, will receive a $2,5OO-per-unit rehabilitation immediately under GSD supervision. Some $9 million is being reserved to beef up managerial staff. Soskin predicted that GSD would continue to provide service to many of the In Rem buildings even after the September 1 transfer to HPD. Johnson anticipated regular meetings throughout the summer between the In Rem Task Force and Raymond and Soskin. "We hope that if some regularity of meetings is achieved, there is a possibility of having a smooth transfer of the buildings," she said. "One advantage of talking now is that we can try to be very relaxed, calm, and cooperative," she added. Time is what is also needed to understand the city's intended "treatment" programs for the buildings, Johnson continued. "Some may be prime candidates for community management or direct sales, and I guess it has to be admitted that some may only find their way into the seal-up and demolition programs. We're hoping that this will be the exception rather than the rule." "Right now there is no massive attempt to bring in the bulldozer," Soskin said. "We would like to see as many of the buildings as possible enter into the HPD programs, specifically direct sales and community management. "Obviously, if we're talking about a 20-unit building 5 that only has two people living in it," Soskin went on, "we're going to ask the people to move out, because we cannot justify spending the money to repair a large number of vacant apartments." He stressed that Mayor Koch and HPD were also committed to this policy. "What the city has to understand," Johnson coun- tered, "is that it is not taking over abandoned buildings. There are people living in these structures who have experienced all the horrors that go along with living in conditions where the landlord has taken everything he can get and then has gotten out. "The city needs to distinguish between abandoned and tenant-run buildings. We hope Mr. Soskin under- stands this," Johnson said. "Let's see whether he trusts us enough." Efforts are being made to insure that tenant groups will have the know-how to keep the buildings alive. The In Rem Task Force is putting together a tenant manual detailing city programs available to groups for saving their buildings. Legal self-help and technical assistance must also be forthcoming, according to Johnson. "The time has come to prepare groups to run their own buildings so that they can come to the city with some strength in discussing their problems," she said. If the interim management agreements proposed to GSD and HPD for the In Rem buildings work out, the volume of buildings able to enter the direct sales program may vastly increase, along lines first proposed by attorney McGaughey last March. He recommended to newly appointed HPD Commis- sioner Nathan Leventhal that direct sales should strive for simplicity and volume. At that time, both Leventhal and William Smith, direct sales program director, opposed the idea of loosening. administrative controls, although admitting that the program lacked the volume to make it effective. For the 35 documents the program currently requires, McGaughey would have substituted just three: 1) a registration form listing tenants' names and apartment numbers, and the telephone numbers of the tenants' association's officers, employes, and agents; 2) a peti- tion showing membership in the tenant association and support for tenant"as is "management signed by at least 60 per cent of the tenants in occupancy; and 3) liability insurance coverage for both the city and the tenant association of at least $100,000 each person, $300,000 each occurrence. Concerning the apparent breakthrough in interim management negotiations, McGaughey welcomed the development but cautioned, "This program contains no promise to sell the buildings to the tenants." He hoped the city would come up with a policy for "outtake" of the In Rem properties within six months. McGaughey praised the "team" assembled by Deputy Commissioner Raymond in the office of prop- continued on page 13 THE PEOPLE'S FIREHOUSE: HOW TO SAY NO AND PREVAIL by Fred Ringler and Ron Webster On June 17 at 10 a.m. fire sirens pierced the air in the Northside section of Brooklyn, signalling the joyous reopening of Engine Co. 212 and the end of one of the most significant community struggles in recent years. The battle to restore adequate fire protection in Northside ended almost as swiftly as it began 2Y2 years ago when Engine Co. 212 was closed, a victim of the large scale cutbacks imposed by the city at the height of its fiscal crisis. During the ensuing years, aroused community resi- dents banded together, moved into the firehouse, refused to let the Fire Department retrieve its engine, negotiated endlessly with the city and ultimately pre- vailed. The victory siren heralded more than just the reopening of a fire company. It marked the education of a community that started out knowing next to nothing about fire protection but was determined to resist what the residents saw as a dire threat to their existence. The outgrowth of this struggle is a permanent organization, the People's Firehouse, committed to the ongoing train- ing of residents of this and other communities in the Fred Ringler and Ron Webster are director and assistant director, respectively, of the People's Firehouse. 6 protection of their homes from fire. The battle began in July, 1975, when the New York City Fire Department closed 26 fire companies. These companies were reopened after two days, with the city mysteriously finding the funds to reactivate them. Engine Co. 212 was one of these companies. No com- mitment was given to the Northside community that it would remain open. In November, 1975, the city announced the closing of eight fire companies, ours among them. Engine Co. 212 has been serving North- side, a mixed industrial-residential working class neigh- borhood, for 114 years. Some 60 per cent of its housing stock is wood frame attached dwellings with common walls and cocklofts, meaning a blaze in one building would spread rapidly to adjoining structures. Industries (including petroleum and chemical) and residences co- exist randomly throughout the community. Community residents realized that the elimination of 212 would mean the end of adequate fire service in Northside. Upon finding out that the city was going to close Engine Co. 212, residents organized to develop a strategy to deal with the situation. On Nov. 21, 1975, ( r 500 angry people met at the quarters of the company and blocked the fire engine and firemen inside the fire- house in an attempt to put pressure on the city to keep the company open. The building and the men were held hostage for one day at which time our elected officials convinced the group to leave the premises with an agree- ment from the city that the firehouse would be left intact for five days. This would give residents an oppor- tunity to institute legal proceedings to stop the closing. Five days later the city got two judges to lift the tem- porary restraining order and on Thanksgiving night, Nov. 27, at 11 p.m. the city attempted to remove the engine from its quarters. Once again the city dealt in bad faith! Residents were alerted when some unknown soul rang the air raid siren on the roof of Engine Co. 212 as a signal. Five hundred outraged Northside citizens assem- bled back at the quarters and again blocked the engine. It then held the truck and the firehouse hostage for 16 months. This was the People's Firehouse battle. During the period of occupation, residents and organ- izers ran the quarters of 212 as a "People's Firehouse," responding to fires, collecting data, doing research on Fire Department decisions, monitoring fire hydrants and ERS Voice Contact Fire Alarm boxes and running the facility as a community service center. All of this was done to convince the city that it had made a mistake in closing the company. Community residents commit- ted themselves to sleeping and living in the firehouse to guard the engine from being taken by the city. Finally on March 17, 1977, the community agreed to an offer made by the NYFD to reopen the quarters of Engine Co. 212 as a Utility Unit, composed of an engine, full complement of men and a foam unit. This Utility Unit was to respond to only 34 first-due boxes in 7 Northside as its major responsibility. Community resi- dents reluctantly accepted the proposal but saw it as the beginning of the full restoration of 212. As we began to monitor the operation of Utility Unit 1, it became clear that it was not serving the needs of the community, was not responding to fires and sat idle while fires raged throughout the community. It was now time to begin the fight once again. Pressure was put on the Fire Department and the Mayor's office for the full restoration of 212. Finally on June 17, 1978, the demand was met and Engine Co. 212 was once again in service protecting the Northside community. The battle was finally won. At the victory celebration, men, women and children cried with joy as they were called up on stage to greet the crowd. Mayor Koch and other elected officials were on hand along with about 1,000 community residents. The subject on everyone's mind was where do we go from here? What should the People's Firehouse do next? The answer seemed simple. We're going to continue mon- itoring our fire service, make sure that the city imposes no more cuts in our community and involve ourselves in housing and the revitalization of the Northside community. The People's Firehouse has a paid staff of seven persons plus some 100 volunteers. We are planning fire prevention seminars, including how to monitor fire hydrants; we are printing fliers in four languages on how to use voice contact alarm boxes; we are continuing to evaluate fire protection in the neighborhood; we are working with the National Association of Neighbor- hoods on a national fire prevention task force. For more information or assistance in setting up or organizing a fire service monitoring project call 384- 9344. 0 BREWING DISPU'IE WITH HUD MAY COST,CITY EXTRA SECTION 8 by Susan Baldwin Hopes for major housing rehabilitation through a new five-year federal subsidy program may prove worthless to most of the 12 city neighborhoods included in a recent city application to HUD, as the city and federal governments spar over responsibility for the first year's allocation of funds. The city has submitted to the New York area office of HUD applications to rehabilitate 6,500 housing units with a Section 8 "substantial rehabilitation" subsidy to be set aside under the Neighborhood Strategy Area (NSA) program. This program, which calls for 20,000 rehabilitated units nationwide in its first year allotment, was an- nounced last Janaury. The city's requests would be added to the 2,600-unit Section 8 allotment already allocated this year under the Community Development (CD) block grant. NSA, according to HUD, is intended to give local governments "a central role in deciding upon the alloca- tion of housing subsidies" in a "concentrated, coordi- nated plan of neighborhood revitalization and housing rehabilitation. " With applications due to be forwarded by HUD's New York office to Washington at the beginning of August, Ralph Lapadula, HUD's area director of housing production, complained that the city has failed to inform its constituents of the program's limitations. "As far as I'm concerned, they should not have sub- mitted 12 applications," Lapadula said. Instead of "culling the field" to find the one or two major neigh- borhoods that best fit the contours of the NSA program and most need its help, Lapadula charged, the city decided to tum over to HUD a batch of applications that could not be approved. "The city is forcing HUD into confrontation with the neighborhoods," Lapadula said. "In the meantime, the money may run out. " Lapadula pointed out that New York normally should expect to receive five per cent of the national housing subsidy allotment. This would mean that, under NSA, the city would receive only 1,000 units altogether, not the 6,500 applied for. Some 150 cities have proposed 50,000 units for designation to the 20,000-unit program, he said. The city has a much different view of the situation. Nathan Leventhal, commissioner of the Department of Housing Preservation and Development (HPD), explained in announcing the city's 12 choices May 31, "Although the NSA program has only 20,000 units allocated nationally, we have applied for a sizable portion of the nationwide funding for New York City 8 because we strongly believe that immediate action in the target areas now will serve to lessen the need for greater federal subsidy in the future." HPD included the following neighborhoods in its NSA applications: Bronx-Kingsbridge/Bedford Park, The South Bronx Plan Area; Manhattan-Washington Heights, Manhattan Valley, Hamilton Heights, Gate- way to Harlem Area; Brooklyn-Crown Heights, Flat- bush, Sunset Park, Bedford Stuyvesant, East New York; Queens-Far Rockaway. It is the applications' inclusion of 1,000 units in the so-called "South Bronx Plan" area, at the direction of the federal government, that particularly vexes both city officials and neighborhood representatives. Vicki Streitfeld, housing liaison for Manhattan Borough President Andrew Stein,asked,"Theyhave the South Bronx in the [NSA] plan? They have to be kidding. As I understand it, they were supposed to pick neigborhoods that are not devastated." Streitfeld's surprise reflects the city's resentment that the federal government forced the city to channel the rehabilitation element of their much -heralded joint plans for the South Bronx through the NSA program, in a nullification of its apparent commitment to process the entire South Bronx redevelopment plan on a separate track, and with funds not otherwise avail- able to the city. Meyer Fender, a Brooklyn representative of the City Planning Department to Community Board 5, analyzed the city-federal conflict this way. "The South Bronx doesn't meet the [NSA] criteria," Fender asserted. "The city thought it [South Bronx] would get a special pool [of funds]. But there aren't enough crumbs to go around," Fender observed. The city also contests Lapadula's assessment of New York's share of the national housing subsidy allotment. Philip Johnson, of HPD's division of community development, said, "New York usually gets about ten per cent." Explaining why his office recommended 12 neighbor- hoods and a much larger share (than ten per cen:) of the NSA program, Johnson said, "There are five boroughs in the city and there are five borough presidents. It has to be a plan that reflects the needs of the boroughs. "We're not interested in going into the most devas- tated areas," Johnson asserted. Under the five-year term for NSA program achievement, Johnson said, "We want to see a beginning and an end." Statements of this kind support the inference, from Mayor Koch's announcement of the applications in May, that the City has unwillingly attached the South continued on page 13 r TECHNICAL ASSISTANCE by Anne Hartwell HEALTH INSURANCE Employees (and their families) of ANHD member organizations and CETA VI Groups are eligible for our new health plan, which includes life insurance, hospi- talization, Major Medical and dental coverage. So far, 14 organizations have enrolled 185 people. The rates are $36.74-a-month for the employee or $85.70-a-month for the entire family. We have found that among the 14 particIpating groups, their existing fringe benefits budgets have covered the cost of their own employees' insurance. More than half of the participating groups were also able to pick up the family insurance costs. For those employees with families who had to contribute to the plan, their paycheck deductions ranged from 12 cents to $5.50 a week. Here is what the medical plan includes. Life insurance - $10,000 term. Accidental Death and Dismemberment - $10,000. Basic Hospitalization - Blue Cross - semi-private room (includes four days of maternity hospital care). Major Medical - private duty nurses; extended hospital confinement; doctor's office visit (other than regular checkup); surgeon's fees; specialists; x-rays and lab fees; wheelchairs, crutches, etc.; prescription drugs and medicines; chiropractors; outpatient psychiatric care (50 per cent of fee, no maximum per year, $20,000 lifetime maximum). Dental - basic care including fillings, extractions, cleaning; fluoride and restoration and root canal, crowns, inlays and prosthodontics. For the Major Medical, there is a $100 deductible per year per individual. In the case of a family, there is a second $100 deductible for a second claim. For three claims or more there is no additional deductible. Major Medical will cover 80 per cent of the first $2,000 in bills and 100 per cent thereafter. The dental program has a $25 deductible per person (lifetime) for basic care; it sets forth a schedule of payment limits that includes $8 for a regular office visit; $12.50 for a single x-ray; $120 for single root canal therapy; $114.25 for a plastic crown. The life insurance, accident insurance and Major Medical are provided by the Prudential Insurance Co. of America. The hospitalization is covered by Blue Cross. This comprehensive health plan was put together after comparing coverage and benefits of about six insurance carriers and analyzing what the participating groups could afford. One of the advantages of the plan is that it allows patients to select their own doctors. SEMINAR ANHD will be sponsoring a series of seminars on neighborhood planning. Eight sessions are tentatively scheduled between July and September. The topics will include an introduction to goals and strategies and types of building control; an explanation of available housing and loan programs, including seal-up, community man- agement, participation loans, 7A and 19A, receivership, direct sales, private loans. Also, HUD's Section 8 program; building manage- ment, including budget projections, rents, bookkeeping, maintenance and tenant meetings; sources of building data-ownership, building violations, allowable rents, tax and other liens and assessed violations. For information about the seminars contact me at 674-7610. 0 9 MEET SOME AMHD STAFF Barbara Pacheco Barbara Pacheco, who has a history of community involvement that spans 13 years, sees her job function as acting as a liaison between ANHD and the Ceta VI groups. "Essentially what I do is help monitor the spending of ANHD's money," she explained, noting that another part of her job involves alert- ing groups as to what the Department of Employ- ment may be looking for in their performance of contract agreements. Visits to the eleven groups and one worksite in the Bronx entail supervising plans and schedules for tenant organizing and training, pre-selection of buildings for city housing programs as well as looking into possibilities for open space develop- ment and urban gardens. The field coordinators visit the groups on a weekly basis and file monthly and quarterly writ- ten reports on the development of the programs. "Tha paper work is unbelievable," Pacheco asserted. "Each individual in the program has seven or eight pieces of paper in his/her personnel file." Noting that the groups suffer from years of maintaining very poor lines of communication with each other and the rest of the city, Pacheco added, "I find that one of the hardest parts of my job is to make recommendations about updating the programs that the groups originally developed when the Ceta VI proposal was first written. Every- thing has changed. There are more city-owned buildings and lots, and as a result, there is a lot of program modification. The housing stock has changed so radically in the three months we have been working." Warning that one of the main problems with being a field coordinator is being viewed as a "spy or social worker form downtown," she said, "I really like my job and I believe I am dOing a lot of 10 good. I am particularly excited by the groups' most recent plans to get involved with as much as 240 to 600 units of rehabilitated housing." Prior to working as administrative manager for the core staff at ANHD, Pacheco did counseling and assistance work with teenage runaways and served as a tenant organizer in Manhattan Valley. She holds a bachelor's degree from City College in the social sciences and a master's degree in family and community life from Columbia Teach- ers' College. She and her four-and-a-half year-old daughter, Cybele, live in Manhattan Valley. Speaking about her future in community in- volvement, Pacheco concluded," I am very interested in women's rights and services, partic- ularly in low income areas where they are virtually non-existent. I am working with a group of 15 neighborhood women right now developing a proposal for a women's storefront in Manhattan Valley. D Jose Garcia Jose Garcia, a former program director in a social service agency in Monmouth County, N.J., sees his job as field coordinator as primarily one of developing "good relations and trust" with the community groups. Although he and Pacheco alternate visits to the groups on a weekly basis, Garcia has found that he has been spending more time in the Northwest Bronx where his duties involve visiting worksites where tenant groups are making building repairs. "Right now things are going pretty smoothly at all the sites," he said, "but I am not looking forward to all the difficult paper work" that will fall due in the next few weeks. A graduate of Puerto Rican University (in Puerto Rico) with a degree in accounting, Garcia is married and lives in the Bronx with his wife, Carmen, and three children, Richard, 7, and three- year-old twins, Eric and Erica. Prior to serving as program director in Mon- mouth County, Garcia was an accountant for six years in a private company. 0 COMPUTER PAYROLL PLAN SET FOR COMMUNITY MANAGEMENT by Bernard Cohen Bookkeeping for the community management pro- gram should be greatly simplified soon when a new computerized payroll system takes over from the old practice of writing checks manually. The computerized payroll, scheduled to begin in early July, is designed to spare the 14 neighborhood organi- zations in the community management program from the complex and time consuming process of computing hours, figuring taxes and writing checks. Under the new system, the groups will provide Chemical Bank with the names of their employes and the number of hours worked. Chemical will compute the taxes, deduct them from earnings and issue checks. The bank will pay the taxes and also issue income tax statements for each employee. "The system looks like a beautiful system," said George Maldonado, controller of Los Sures in Brook- lyn, one of the neighborhood-based organizatipns in the program. Under the community management program, the city contracts with community housing organizations to manage city-owned buildings. Some 300 people are employed by the groups and the number is expected to grow quickly with the addition of a rehabilitation com- ponent to the management contract. The transition to automatic payroll has been in the planning for a year, during which time City Comptroller Harrison Goldin released an audit that severely criticized the Department of Housing Preservation and Develop- ment for lax fiscal monitoring of the community management program. "Goldin was right. He came down very hard," said Steven Fredericks, HPD assistant commissioner for fiscal affairs. Fredericks calls himself a strong believer in the program. "I had to give my word that this would never happen again." Rudy Jennings, chief auditor of the community man- agement program for HPD, said that while many groups did an excellent job of handling payroll, others had difficulty in figuring the taxes accurately and making the proper deductions so that the taxes could be paid. As a result, he said, it was frequently difficult to reconcile balances and four of the 14 groups owed a total of $24,000 in back taxes and penalties covering a three to four-month period. In rebuttal, .the community organizations charge that HPD historically has neither provided the necessary accounting training assistance nor issued clear, con- sistent fiscal guidelines for the groups. "The only way we ever find out about a problem is after we've done it 11 and it's wrong," s a i ~ one organization representative recently. It was only within the past year that a fiscal training manual was even available, another added. Fredericks said he has been making an effort to meet with the community organizations and work more closely with them to improve performance and contract compliance. Aside from easing the accounting burden, Fredericks said, the biggest advantage of the Chemical computer is the security of a guaranteed weekly or bi-weekly pay- roll. "In the past there were problems with funding for payroll," he said, referring to delays by the city in depositing quarterly checks. "That worry is gone." The reason for the new security, Fredericks explained, is that city money to back the payroll will be drawn automatically into Chemical's community management account from a central pool of funds used by the city for many of its bills. Each payday, the community organization will go to its local Chemical Bank branch and pick up the payroll. The checks can be cashed at any Chemical branch as well as at the employee's own bank. Community organ- izations can put their non-community management employees on the computer as long as the groups deposit their own funds into the payroll account. "The groups are getting a lot of service and it's not going to cost you anything," Fredericks said. William Barr, vice president of Chemical Bank, said the bank does 1,800 payrolls and that the community management program is its first public municipal client. Advantages for the bank, according to a number of sources, include use of the funds between the time they are deposited and the time the checks clear (HPD has made its first monthly deposit of $233,(00), an extra "compensating balance" the city pays to cover bank expenses and the possibility of attracting new depositors among the community management employees. Fredericks declined to discuss how HPD intends to monitor payroll other than to say, "We will verify in some way the existence of employees, their rates of pay and that they are receiving their checks." The Oceanhill-Brownsville Tenants Association has been using a computerized payroll for some of its other employees, and Roy Henry, OHB's controller, says it has worked well. "Before, we were always harassed and hurrying with the payroll," he said. The new system will afford more time to train bookkeepers to do a better job of handling their other fiscal duties, he added. 0 CONSUMER COOPERATIVE BANK by Bernard Cohen Creation of a new bank that would provide major financial and technical assistance to all kinds of consumer cooperatives, including housing co-ops, is undergoing final consideration by Congress. "This is one of the most important bills that Congress will consider in the next 10 years" from the standpoint of developing community-based enterprises, according to Shanti Fry, former manager of the Cambridge, Mass. food co-op and now with the federal agency, ACTION. "It is unlikely that another bill will go through with this amount of funding," Fry said. If approved, the National Consumer Cooperative Bank would stimulate creation and growth of housing, consumer goods, health, energy, food, credit and other kinds of cooperatives that have experienced serious difficulty in the past obtaining conventional financing. In addition to the bank, which would provide loans to "credit-worthy" cooperatives at U.S. Treasury interest rates, the legislation would create a separate "Self Help Development Fund" administered by ACTION to lend money at below-market interest rates to low income cooperatives and would set up a program of technical assistance. The U.S. Senate is expected to debate the legislation in mid-July. Opponents have agreed to limit debate on the bill and proposed amendments and avoid a repeat of the filibuster that recently blocked efforts to revise the labor law. The Co-op Bank bill passed the House of Representatives last year by a single vote. While there are many kinds of cooperatives, all share certain characteristics. Consumers of the product or service provided by the association are also the owners so that benefits go to the participating members. Advantages can include lower prices, rebates, lower rents, plus nonmonetary benefits such as better service and better understanding of the process. Unlike commercial business, cooperatives directly relate ownership with consumption. Patterned after the Cooperative Farm Credit System, which has helped rural and farm co-ops for 60 years, the bank would start with $300 million to $500 million invested in preferred stock by the U.S. government. Initially, the chairman and board of directors would be appointed by the President. A portion of each loan would be in the form of shares so that borrowers become investors in the bank. As loans are repaid, co-op capital will replace government capital. As co-ops increase their investments in the bank, they will elect increasing numbers of directors. Advocates of the legislation say it is not clear how many loans will be targeted to low income cooperatives. The Senate bill instructs the bank's board to use its "best efforts" to target bank loans to low income groups. In addition, there is some disagreement over the defi- nition of a low income cooperative. Some groups such as the Cooperative League of the U.S.A. favor member- ship by at least "a majority" of low income families as the definition so as not to encourage segregation of low income Americans in co-ops. Others, fearing that loans intended for low income groups will be diverted to more middle income areas, are pushing for a higher minimum of 80 per cent. Ernie Eden, executive director of the National Asso- ciation of Housing Cooperatives, acknowledged the uncertainty of the targeting but said, "Our Association has a lot of low income members. We're pushing for equal access to everybody." The legislation would limit spending on housing to 30 per cent of the loans, although some groups are asking that rehabilitation-as opposed to new construction- be excluded from that limit. Eden said a wide variety of housing and related activities would be eligible for loans or loan guarantees including purchase "f a building, rehabilitation and installation of solar energy, insulation and other energy saving measures. ~ In the House-passed version (HR 2777) housing co- ops would have to seek HUD financing before qualify- ing for a bank loan. Fry said opposition to the legislation has come from those who generally oppose federal spending and from small-business groups who argue that the bank would give cooperatives an unfair economic advantage. Supporters point to the existence of the Small Busi- ness Administration, which has made more than $20 billion in loans since 1953, and argue that consumer cooperatives have a right to the same kinds of financial and technical assistance as the small-businessman. The biggest threat to the Co-op Bank package is an old Ford Administration amendment that would substi- tute a $20 million pilot study that would include a miniature loan program. "Any time the Congress wants to kill something, they decide to do a study," said one opponent of the amendment. At a conference June 8, the New York Committee for the Co-op bank was organized. Co-chairpersons are Chuck Laven and Charyl Edmonds of the Urban Home- steading Assistance Board. Sen. Jacob Javits has expressed his support for the bank. Sen Daniel Moynihan has not announced his position, although staff aides say he is leaning away from the bank bill and toward the pilot study amend- ment. 0 12 ..... Twelve buildings in the South Bronx and Lower East Side will be rehabilitated in the next 16 months by the low mcome residents of those neighborhoods under a "demonstration" sweat equity program using federal 312 loans. Title transfer and loan commitment were signed June 22 at City Hall. Left to right: Roberto Nazario and Vernon Perkins of Interfaith Adopt-a-Building on the Lower East Side and Deputy Mayor Ronay Menschel. Similar signing occurred for People's Development Corp. which will rehab the buildings in the South Bronx. Interim Leases continued erty management at HPD. "Their heads are in the right place-they have a good attitude and approach, and I think we're going to have a good program," he pre- dicted. McGaughey hoped that community groups would join with the tenant organizations to seek interim management contracts from the city. Referring to the management contract, he said, "Although there is no substantial overhead money, there is a management fee which would cover a couple of people working part-time. "This is a good way for groups to get their foot in the door," McGaughey added, pointing out that more com- prehensive contracts might follow, entailing greater responsibility and opportunity for improving communi- ties. 0 Section 8 continued Bronx units "at the request of the federal government." On the other hand, criticism of the city for the way it packaged the NSA applications is not hard to find outside the confines of HUD's area office. Martin Warmbrand, of the East New York Develop- ment Corporation, serving an area designated by the city for NSA inclusion, said, "As far as I know, they arbitrarily selected them [the areas} ... That's the way they operate. They get precious little input from the neighborhoods. " Warmbrand faulted the city for not working through the community boards in preparing the NSA applica- tions. He complained that the NSA program in East New York covered too little ground to have major impact. 13 Tbe influx of In Rem Buildings to city ownersbip bas brougbt witb it job opportunjties as real estate managers to qualified tenants and community workers, according to Joan A. Williams, director of Community Action Center No.7 in Brooklyn and a member of tbe In Rem TaskForce. Witb more such jobs available tban applicants waiting on the Civil Service list, Williams says, the city's Department of General Services (GSD) bas agreed to consider hiring as managers, at $11,000 per year, appli- cants with either a bachelor of arts degree or three to four years' managerial experience in real estate. Williams urges those interested to submit resumes directly to: Mr. Perry Soskin, Assistant Commissioner, Department of General Services, 2 Lafayette Street, New York, N.Y. 10007; or to: Mr. Sandy Bayer, In Rem Task Force, c/o Councilwoman Ruth Messinger, 250 Broadway, New York, N.Y. 10007. Another neighborhood included in the city's NSA application provided an equally skeptical community group representative. Ennis Francis, of Harlem-East Harlem Model Cities said, "What they're doing here is passing the buck . . New York City has the responsibility to designate [priority} areas," Francis declared, "and shouldn't be allowed to shirk that responsibility. .. If they're not prepared to designate the areas, let them get out of the business," she concluded. Whoever finally takes the blame for the city-federal quarrel, the city's neighborhoods seem likely to have learned another painful lesson in raised expectations and frustrated hopes. 0 UDAG NOTES FROM WASHINGTON BROWN AMENDMENT HUD's new $400 million Urban Development Action Grants (UDAG) program is supposed to "achieve a reasonable balance" among projects designed to restore needy neighborhoods, gen- erate industry and renew commercial employment centers. Last April, HUD announced the first round of UDAG grants totaling $150 million. Two-thirds of the money went for central business district revi- talization efforts. The National Commission on Neighborhoods estimated that only six projects t.otaling $5 million, went to neighborhoods. Responding to criticism over first round spending, HUD Assistant Secretary Robert Embry promised that subsequent grants would be heavily weighted toward neighborhood projects. Joseph McNeely, director of HUD's Office of Neignborhood Development, reaffirmed that pledge in a recent mailing and said HUD is looking for proposed projects that will be carried out in neighborhoods, owned in whole or in part by com- munity based development corporations or devel- oped with the substantial participation of such groups. McNeely's letter suggested that community organizations work with their city governments to develop UDAG proposals, encourage their cities to develop projects that can be carried out by local organizations or initiate their own projects. For further information, contact City Limits or the UDAG Task Force, Room 7238, HUD, Washing- ton, D.C. 20410. Telephone (202) 755-6195; or your HUD area office. _CITY LIMITS. published monthly by the Association of Neighborhood Housing Developers, Inc., 11S East 23rd Street, New York, New York 10010 (212) 674-7610 Editor .... .. .... . ......... ... . . ...... . .. . . . .... Bernard Cohen Assistant Editor .................... . .. . ...... ... Susan Baldwin Design and Layout .... . .. . ................... ... .. Louis Fulgoni Production ... ......... ... . . .............. . .. Marianne Czernin Copyright 1978. All rights reserved. No portion or portions of this News- leller may be reprinted without the express wrillen permission of the Association of Neighborhood Housing Developers. Inc. The House of Representatives has passed legislation that includes an amendment that would weaken greatly the Community Development Block Grant program's emphasis on low and moderate income people. The amendment, which was introduced by Rep. Garry Brown of Michigan, would eliminate the existing authority of the Secretary of HUD to apply a "benefits test" to CDBG applications. The test is whether low and moderate income people are the "principal beneficiaries" of the proposed CDBG application-the transcending purpose of the 1974 Housing and Community Development Act. The law currently allows the HUD Secretary to dis- approve applications that do not comply with Title I of the Act by either. principally benefitting persons of low and moderate income, preventing and eliminating slums and blight or meeting other urgent community develop- mentneeds. While the new CDBG regulations interpret this clause to provide a three-fold test, the regulations also stress that the principal beneficiaries of the overall program must be low and moderate income people. Brown's amendment would forbid the Secretary to "disapprove an application due to the fact that such application addresses anyone of the primary purpose ... to a greater orlesser degree than any other." '-./ Critics of the amendment say it would undermine the concept of targeting CD funds to the areas where they are needed the most. They add that the likely place to remove the amendment will be when it goes into con- ference between the House and the Senate. Those wishing to register an opinion should write to: Sen. William Proxmire, 5241 New Senate Office Build- ing, Washington, D.C. 20510 or Sen. Edward Brooke, 437 Russell Senate Office Bldg., Washington, D.C. 20510. HUDOFFICE HUD's Office of Policy Development and Re- search is opening an office in New York City, the only regional PD&R office in the country. Sybil Phillips, director of community conservation research, will head a staff of about seven. "Since New York City has the largest reservoir of building capable of some form of cooperative ownerShip, we felt it should be a laboratory to tes different forms of tenure," Phillips explained. The office wi II be at 26 Federal Plaza. CITY LIMITS Have You Sent Us Your Subscription? 250,000. In this city of large numbers, that's a large number. The City of New York is fast becoming the number one landlord - some say slumlord - in town, with more than 250,000 tenants in the 20,000 buildings it will take over this year for non-payment of taxes. Of course you've noticed. But what are we to do? You will get some answers to that and many other questions from City Limits, the monthly journal of the neighborhood housing movement, because City Limits has been covering the onrushing problem of building abandonment and foreclosure and the people trying to deal with it since our first issue in February, 1976. Until recently, New York's housing crisis was but one of many. By the time another long cold winter looms, however, housing may be at the top of everyone's agenda, yours, ours, and City Hall's. We think now is the time you need to know what the neighborhood housing groups, the tenant groups, and the government bureaucrats are doing - or not doing - to shape and carry out a coherent urban housing policy. City Limits will tell you now. City Limits will put you in touch with people, places, problems, and programs affecting housing that the daily newspapers rarely-and barely-touch. What have you heard, for instance, about the In Rem Task Force? Direct Sales Coalition? Community Management? Participation Loans? Fuel cooperatives? Energy alternatives? All these were the subjects of recent (and ongoing) City Limits stories. If you agree that we're telling the housing story that needs to be told for you and for the city's neighborhoods, take out your checkbook today and take another look at City Limits, beginning with the current issue. To subscribe, tear off and return the coupon below. 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IN THIS ISSUE 590 Parkside Ave. In Rem Interim Leases People's Firehouse SectionS Co-op Bank Computerized Payrolls 'A'N '1IJOA MeN leeJIS 1883 SU 'OUt 6u!SOOH pc>04JOq4BtaN jO Have You Sent Us Your Subscription?