Challenges and Opportunities Await De Blasio’s Historic Housing Effort; Part I

Over the course of his first 100 days, New York City mayor Bill de Blasio has shown a tendency to aspire towards the historic. His plan to create or preserve 200,000 units of affordable housing is no exception.

De Blasio’s affordable housing goal exceeds those set by previous mayors. Mayor Koch reached about 190,000 units over approximately 15 years, while Mayor Bloomberg sought to complete 165,000 new units over 12 years (some of these units are just now coming on line).

How will he do it? The administration is developing its affordable housing plan now, and a report is expected in May that will detail its plans.

Meanwhile, de Blasio’s campaign literature provides some clues. The new mayor will make inclusionary housing mandatory, will look to convert illegal basement units into legal, affordable apartments, will increase taxes for vacant properties in an attempt to encourage development, and direct the city’s pension fund investments into affordable housing in the city.

The mayor will need to utilize all of these strategies and more to reach his goal. The challenges facing his administration are formidable.

De Blasio’s first challenge is that the number of affordable units he proposes to create exceeds the number of new units that were built—at any income level—over any ten-year period since at least 1981.

To reach his goal, de Blasio’s administration would need to complete 20,000 affordable units a year. But between 1981 and 2008 there were only three years in which housing production exceeded 20,000 units—and this figure includes market rate units as well as affordable units.

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Source: HPD, Housing New York City 2011

The good news is that de Blasio will not need to actually “build” 200,000 units to reach his goal. It is a common misperception that when city leaders talk about “building” affordable units, they’re only referring to new construction. But often the bulk of new affordable units consist of “preserved” units, or preexisting units that receive financing or tax breaks in return for keeping rents at an affordable level.  Under Bloomberg the city preserved twice as many affordable units than it built: 107,119 units preserved versus 50,111 newly constructed units.

But even if de Blasio keeps the same proportion of newly constructed units versus preserved units, it’s clear that the pace of construction will need to accelerate. Otherwise nearly 50% of all newly constructed units in the city will need to be affordable units if de Blasio is to reach his goal.

The next challenge is that de Blasio’s plan relies too much on inclusionary zoning to reach 200,000 affordable units. The mayor’s campaign literature suggests that new, tougher inclusionary zoning laws will create 50,000 new affordable units over the next decade.

Under Bloomberg, the city created 2,800 IZ units over seven years, or just 400 a year. Even with mandatory inclusionary zoning and higher requirements, such as a 30% affordability requirement as opposed to 20% affordable, the production of 50,000 new IZ units is highly unrealistic.

I’ll put it this way. Even if Bloomberg had required the inclusion of mandatory units in all new developments, as de Blasio plans to do, the city would have only seen 39,000 new inclusionary units over eleven years. This is certainly an improvement, but still not enough to get to 200,000.

(For this calculation, I am simply looking at the number of new units constructed under Bloomberg at all income levels and multiplying by 20%, the standard affordable requirement under the city’s inclusionary housing program.)

Another challenge is shrinking commitments from the federal government. Without getting into the specifics of federal housing policy, we can generally expect less federal money for the city’s affordable housing efforts, and we can expect that city dollars will not go as far as the federal government scales back its programs.

The Bloomberg administration put forward $5.3 billion in city capital funds for affordable housing, according to reporting from the New York Times. Koch used $5.1 billion in city funds. The city may have some room to increase its capital contributions for affordable housing, as this IBO report indicates, and de Blasio said he plans on directing the city’s pension funds to invest about $1 billion in affordable housing. The fact remains, the capital needs of de Blasio’s affordable housing plan will be significant.

De Blasio will also be facing pressure to target a larger share of new affordable units to low-income households. Affordable housing advocates have noted—correctly—that the majority of new affordable units built under Bloomberg were not actually affordable for the residents of the neighborhoods in which they were built, based on a neighborhoods’ median income.

The goal of deeper affordability is important, and de Blasio will come under intense scrutiny from progressives to target lower-income households. But the tradeoff may be fewer total units built.

Finally, de Blasio will need to overcome the fact that most of the city’s land has been built out already. Previous housing plans under Koch and Bloomberg relied heavily on city-owned properties and vacant land, but there is little vacant land still available. HPD-owned vacant land can support an additional 7,000 units, but nearly half of these would be on the Rockaways peninsula—far from jobs and the city center and prone to flooding and storms.

This is not an exhaustive list of the problems that the de Blasio administration will face, but it gives us a better idea of what some of the most pressing issues will be. I will talk about opportunities for affordable housing development in a future piece.

The Wrong Advice

State legislators and Governor Andrew Cuomo reached a deal on the state’s annual budget over the weekend. The budget would cut property taxes, corporate tax rates, a tax on banks, and on estates worth over one million dollars.

Since taking office, Governor Cuomo has made cutting taxes and reversing the state’s reputation as “unfriendly” to business among his top priorities.

Last month it was revealed that the Governor’s office had reached out to the “right-wing” Tax Foundation for consultation. The Tax Foundation has repeatedly ranked New York State’s “business climate” the worst in the nation.

But basing state policy based on the Tax Foundation ranking would be a mistake.

The organization’s business climate rankings are based on each state’s tax system and rates. They are not a measure of how well businesses are actually doing in a certain state.

In fact, the states with the best “business climate,” according to the Tax Foundation, are actually performing worse than New York State in several respects.

The charts below show that, regardless of the Tax Foundation’s ranking, businesses in New York State are actually faring quite well. I compare New York with the 15 states with the best “business climate” rankings, according to the Tax Foundation.

Business growth in New York State has outpaced all but two states among the Tax Foundation’s top 15 ranked states. Between 2008 and 2012 there has been a 3.6% increase in the number of businesses in New York, compared with 0.3% for the Tax Foundation’s top 15.

Source: Quarterly Census of Employment and Wages, Bureau of Labor Statistics, U.S. Department of Labor

Next, I compare the Gross Domestic Product—the value of all goods and services produced in a state—of New York versus the top 15 ranked states. I looked at GDP growth between 2008 and 2012 and found that New York falls somewhere in the middle of the pack. At 11.7% GDP growth in New York was slightly higher than that for the top 15 as a whole at 11%.

Source: Bureau of Business and Economic Research, University of New Mexico

It is worth noting that New York’s GDP in 2012, at $1.2 trillion, is higher than every other top 15 state other than Texas. New York’s GDP per capita, which takes population into account, is still much higher than most of the top 15 states except for Alaska and Wyoming, with their tremendous energy resources, and Delaware.

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Source: Bureau of Business and Economic Research, University of New Mexico

In terms of employment growth, New York is one of the few states to have regained the jobs lost during the recession. Among the Tax Foundation’s top 15, Alaska and Texas have regained jobs at a greater rate than New York. As a whole, the top 15 ranked states had an overall net loss of employment between 2008 and 2012.

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Source: Quarterly Census of Employment and Wages, Bureau of Labor Statistics, U.S. Department of Labor

One measure that is not included in the Tax Foundation’s business climate rankings is the percentage of residents with a bachelor’s degree. Presumably, access to an educated workforce is important for business growth.

New York fares quite well compared with the top 15 states, with 33% of residents with a bachelor’s degree.

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Source: American Community Survey, 2012 3-year average, U.S. Census Bureau

The data presented here are not conclusive, but they certainly show that the Tax Foundation’s “business climate” rankings offer a poor measure of how well businesses in a particular state are actually faring.  A single-minded emphasis on lowering taxes will not necessarily lead to higher economic growth.

Taxes do matter, but New York’s economy and business growth is robust. If it is “too expensive” to do business in New York, it is not reflected here in the data.

Instead of trying to compete with the lowest-cost states, New York must offer a better value for businesses that includes superior infrastructure, educational institutions, a healthy and educated work force, and a high standard of life.

Bloomberg Says You Should Be Scared, but What is Really In the Community Safety Act?

There seems to be a lot of misunderstanding about what is in the City Council’s Community Safety Act.

Mayor Bloomberg held a press conference in order to warn New Yorkers about what he feels are the dangers of the Act, especially the creation of an Inspector General.

Here is my summary of what is actually in the bills:

NYPD REFORM BILL IN THE CITY COUNCIL: Community Safety Act

A series of bills in the City Council seeks to limit the NYPD’s use of stop and frisk, to end “bias-based” policing, and to create an Inspector General for the police department.

 

Prohibiting bias-based policing: Defined in the bill as actions in which race, color, ethnicity, religion, etc, were the “determining factor” for the action.

·      Allows those who feel they were subject to bias-based policing to file suit.  Plaintiffs would be able to bring a civil action for injunctive and declaratory relief

 

Requiring documentation of search, NYPD to tell individual of their right to refuse:

·      Before NYPD conducts a warrantless search:

o   Must tell person that search is voluntary and that they may refuse;

o   Create a record of person’s consent:

§  Statement that person understands they may refuse, that person is voluntarily submitting to search, that they may withdraw consent at any time during the search

§  Record to include names and badge numbers of officers

§  A copy of “consent record” to be provided to person who consented to a search.

 

Require officers to identify themselves and state the reason for the search. In the case of a search that does not result in an arrest or summons, officer must provide person with officer’s name, rank, and command and a phone number for the Civilian Complaint Review Board.

 

Establish an Inspector General: The IG would be appointed by and report to the mayor. The IG cannot be a current member of the New York City police department or have served in the department within the last 10 years.

 

The IG would:

·      Review the policies, practices, programs, and operations of the department;

·      Make recommendation to improve the department’s policies, practices, programs, and operations, including for the purpose of promoting civil liberties and civil rights;

·      The inspector general shall create a mechanism for the public to submit requests for reviews;

·      Prepare semiannual reports;

·      Have subpoena power and access to NYPD records, audits, reviews, and other documents.

 

Deputy director appointed by IG and to “serve as a liaison” between the IG and NYPD. Deputy Director to have an office physically within the NYPD.

Political Will Needed to Bring Improved Bus Service

In a speech on transportation issues today, New York City Council Speaker and mayoral candidate Christine Quinn said that as mayor she would rapidly expand the number of Select Bus Service lines—ten new lines in four years.

Select Bus Service is a type of enhanced bus service rolled out by the Bloomberg administration and the MTA in 2009. The city now has five Select Bus Service lines and they’ve succeeded in increasing travel speeds and attracting new riders.

Improving bus service is a popular idea among voters and transportation experts.

And yet, making an announcement is one thing, but having the political will needed to build out new Select Bus Service lines is another. In order for the buses to be successful road space must be taken away from car drivers—travel lanes or parking spots.

In an indication of just how difficult the political process will be, Streetsblog reported today that New York State Senator Bill Perkins wants to slow down plans to bring Select Bus Service to 125th Street in Harlem.

In a letter written to the city’s transportation commissioner, Perkins states that the DOT has not done enough to engage the community, saying that “their concerns have been ignored.”

As Streetblog points out:

Last fall, after Upper Manhattan transit advocates demanded improvements, DOT began planning better bus service for riders along the corridor. The agency has surveyed merchants, held three Community Advisory Committee meetings, three public workshops, presented before three community boards, and according to DOT spokesperson Nicole Garcia, attended more than 30 private meetings as the plan moved forward.

Everyone agrees that the city needs better bus service, and yet when presented with a plan to do just that, local elected officials balk.

Indecent Expenditure

An independent group calling itself NYC is Not for Sale 2013 has pledged that it will spend more than $1 million to block the election of New York City Council Speaker Christine Quinn for mayor. The group aired its first television commercial attacking Quinn this week, claiming that the Speaker “is always on the wrong side” on the issues that “New Yorkers care most about.”

Quin responded by criticizing the use of independent expenditures, saying that spending by outside groups is inappropriate in the mayor’s race because of the city’s system of publicly financed campaigns.

"I don’t care who the ad is about," Quinn said to reporters yesterday. "I don’t care who the ad is from. We have no place for this type of indecent expenditure in New York City’s campaign system."

More than anything, the formation of this well-funded group shows the extent to which a small group of highly-motivated New Yorkers are committed to preventing Quinn from gaining the mayoralty. Quinn may be the most popular mayoral candidate, but she may also be the most intensely disliked.

Take, for instance, these anti-Quinn Twitter accounts. As far as I can tell, no other candidate is subjected to this type of social media slandering. The same goes for the anti-Quinn websites, some more hysterical than others, that seek to block the Speaker’s road to City Hall.

Quinn has the highest “favorable” rating among her opponents for mayor, but she has one of the worst “unfavorable” ratings as well. In late February a Quinnipiac poll found that 51% of voters had a favorable opinion of Quinn, 21% had an unfavorable opinion, and 27% that said they haven’t heard enough yet to form an opinion.

Only John Liu, whose campaign is under investigation for improper fundraising activities, has a worse unfavorable rating.

Quinn’s unfavorable rating is attributable to her high profile. As Council Speaker for the past eight years, Quinn has built up considerable name recognition and an early lead in the polls. But Quinn’s high profile is a double-edged sword, as the independent expenditures make clear. Her eight years as the “brash" Speaker has earned her plenty of enemies as well. 

NYC is Not for Sale has pledged it will spend more than $1 million, a very significant sum in the mayoral race. That’s more than one quarter of the money raised by the Bill de Blasio campaign or the Bill Thompson campaign.

Political Implications of the Paid Sick Days Compromise

After three long years, an agreement was reached that would allow the New York City paid sick days bill to advance in the City Council and come up for a vote.

The compromise is a bitter victory for progressives. The bill is significantly watered down, exempting businesses with fewer than 20 employees. This carve out means that over 300,000 working New Yorkers will not get access to paid sick days. In 2015, the exemption will be lowered to businesses with fewer than 15 employees.

But it is still a victory, considering that Mayor Bloomberg and the city’s powerful business lobby were adamantly, passionately against the bill. They hated the very idea of it, and the compromise is harder for opponents to swallow than proponents.

This compromise will change the tenor of the mayoral race. As Dana Rubinstein at Capital New York points out the biggest loser may very well be one of the bill’s strongest supporters, Bill de Blasio. De Blasio had been hammering Quinn over paid sick leave incessantly on the campaign trail. De Blasio will now talk about Quinn’s record of “watering down” legislation, as she did with a living wage law two years ago, but his message has lost some potency.

But the most significant development lies in the realm of union endorsements. The powerful union SEIU 32BJ stepped in to negotiate a compromise on the bill earlier this week, taking over for the Working Families Party. The fact that Quinn worked out a compromise with 32BJ indicates that she may be that much closer to securing their endorsement.

With a significant fundraising advantage and the endorsement of a large union like 32BJ, Quinn will be tough to beat. The key for Quinn’s opponents will be securing the endorsement of the 1199 union, the city’s other large, powerful labor voting bloc.

Despite Criticisms, Quinn Campaign Still Looks Strong

If it wasn’t common knowledge before, it is now: New York City Council Speaker and leading mayoral candidate Christine Quinn has a tendency to be brash, pushy, and loud. Earlier this week the New York Times reported on Quinn’s “angry tirades” and her “habit of hair-trigger eruptions of unchecked, face-to-face wrath.” 

These revelations have taken the public by surprise. Quinn’s lead in the polls attests to her broad name recognition, but the intense reaction to the Times story implies that voters don’t know much about Quinn beyond her name.

Quinn’s controlling and, at times, vindictive style of governing is no secret among those who closely follow New York City politics. Quinn’s use of Council discretionary funds to reward allies and punish detractors has been reported for years. I’ve heard other Council members drop their voice and speak in hushed tones when criticisms of Quinn come up in conversation, as if they were frightened that the Speaker might come up from behind and hear them. 

But most voters don’t follow city politics very closely, and these aspects of Quinn’s personality were not widely know even among those that were tentatively towards supporting her candidacy. Now the Times story will be a fundamental component of her campaign narrative in the minds of voters.

It remains to be seen whether the Times story will hurt Quinn’s standing with voters. So far the story seems to be boosting Quinn’s public profile,  with appearances on CNN and MSNBC the day after the story broke. Her rivals for City Hall would love to get that kind of media attention.

In particular, Quinn’s “volatility” may still become a liability in the race, as Chen noted on the Brian Lehrer show. Voters don’t want an “unpredictable” mayor. They do want a mayor that can get things done, though, and a tough, fearful temperament will be seen by some as a plus.

Still, more important than uncontrolled outbursts and threats of castration is Quinn’s impressive lead in fundraising. Quinn has raised $6.7 million for her campaign, more than $3 million than her closest rival Bill de Blasio. She continues to shore up endorsements from labor unions and has good ties to the city’s real estate and big-business interests.

It may be that the more voters get to know Christine Quinn, the less they will have to like about her. But until her opponents can match her spending power, stories like the one in the Times will have only a marginal impact.

NYC Speeding Cameras Still a Long Way Off

Speeding is a major cause of traffic deaths in New York City.

A bill is under consideration in Albany that would allow NYC to install 40 automatic speed cameras (certainly a small number considering the size of the city). Automatic speed cameras have been proven to prevent speeding, crashes, and injury in other cities.

But the bill is being held up due to opposition in the legislature, including Assembly member Marty Golden from Brooklyn.

Dana Rubenstein at Capital New York has the story.

I was struck by this observation: “Traffic deaths are increasingly being seen, or at least contextualized by concerned officials, as a public health problem.”

This is certainly true—a change in attitudes that has evolved over the past few years.

When researching the subject of traffic safety in New York City a few years ago,with the number of gun-related homicides in the city. Surprisingly I found that traffic deaths present a threat to public safety on the same scale as gun violence.

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The message is: if you’re concerned about gun violence, you should be equally concerned about traffic safety.

Culturally, we tend to treat traffic crashes as something that just happens—they’re accidents. But in fact they are preventable, and things like speed cameras have the power to save lives.

In Next City: Paid Sick Days Ail Christine Quinn’s NYC Mayoral Campaign

Paid Sick Days Ail Christine Quinn’s NYC Mayoral Campaign

03/25/2013 10:44am

Though Quinn has enjoyed an early lead in polls and a fundraising advantage, the paid sick days issue has increasingly weighed down her otherwise buoyant campaign.

In Next City: The Mayoral Race and the State of Transit in New York

The Mayoral Race and the State of Transit in New York

03/05/2013 12:48pm

Given the MTA’s outsized importance to the city’s economy and workforce, one would expect transit to be among the more pressing issues during the 2013 mayoral campaign. But when seven candidates spoke at a forum on transit last month, it quickly became clear that improving transit falls pretty low on their agendas.

In Next City: Do Bloomberg’s Would-Be Successors Think Atlantic Yards Was a Good Idea?

Do Bloomberg’s Would-Be Successors Think Atlantic Yards Was a Good Idea?

02/22/2013 7:00am

Last week the nation’s newest pro-basketball arena, the Barclays Center, played host to New York City Mayor Michael Bloomberg’s final State of the City speech. It was a spectacle that the Daily News aptly described as a pep-rally.

In Next City: A Closer Look at Ed Koch’s Affordable Housing Legacy

A Closer Look at Ed Koch’s Affordable Housing Legacy

02/07/2013 10:53am

…It was this belief in his hometown’s resilience that led Koch to embark on what many regard as his greatest achievement as mayor: His plan to use billions of city dollars to build and rehabilitate nearly 200,000 units of affordable housing.

In Next City: Last Dance: Bloomberg’s Budget Legacy

Last Dance: Bloomberg’s Budget Legacy

02/05/2013 9:52am

Michael Bloomberg gave the final preliminary budget presentation of his mayoral administration last week, signaling the end of an era in New York City politics.

In Next City: How Will New York Handle the Fast Food Walkout?

How Will New York Handle the Fast Food Walkout?

12/04/2012 9:00am

In a move that grabbed headlines and the attention of industry executives, dozens of New York City fast food workers walked off their jobs last Thursday, forming picket lines outside outlets of major chains including McDonalds and Burger King. The workers walked out in demand of higher wages and the right to join a union. If corporate bosses heed the protests, salaries at the chains would lift to a still-modest $15 an hour, a raise that would nearly double take-home wages.

In The Huffington Post: On Campaign Finance Reform, Senate Republicans Stand in Gov. Cuomo’s Way

On Campaign Finance Reform, Senate Republicans Stand in Gov. Cuomo’s Way

01/29/2013 1:10 pm

Senate Republican leader Dean Skelos repeated his opposition to Governor Andrew Cuomo’s proposals for campaign finance reform last week, setting up another battle between the Governor and state Republicans.

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