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Public housing tenants scored a major victory last week by forcing the Giuliani administration to withdraw its request for a waiver from federal housing regulations–which could have led to rent hikes and the possible privatization of some NYCHA projects.

But the New York City Housing Authority may still move ahead with several plans included in the waiver application, including steep rent hikes for working class families, City Limits has learned.

On Thursday, NYCHA Chairman Ruben Franco, who endured four hours of vitriol from tenants at a packed public hearing last Tuesday, announced he was withdrawing the city’s “Moving to Work” application.

“It’s gone, it’s out, it’s off the table, it’s time to move on,” Franco told members of the state assembly’s housing committee, chaired by Brooklyn Assemblyman Vito Lopez. “We just couldn’t go forward,” he added later. “We really needed tenant support and we just didn’t have it.”

“I think it’s probably the biggest victory I’ve ever seen for housing authority tenants,” said Judith Goldiner, a Legal Aid lawyer who helped organize tenants to rally against the plan at Tuesday’s hearing.

Yet even as he scuttled the plan, Franco told City Limits he might consider getting rid of the $500 “ceiling rent” which caps rents for working-class tenants. “The ceiling rents are a creature of NYCHA, we can remove them whenever we want,” he said. He added that the plan was important because NYCHA is losing millions of dollars in federal funding and needs to find alternative revenue.

There are several other key components of the application that the authority is still free to pursue. Under federal law, NYCHA can bar welfare recipients from new admissions into the system’s most desirable developments; because of a bill passed last year, during 1997 NYCHA can tear down or sell off units without having to replace them with new apartments; and the authority has already been granted permission to push moderate-income tenants to the top of the public housing waiting list, pending the approval of a state judge.

Franco told City Limits he plans to proceed with the one non-controversial part of the Moving To Work Plan: $15 million for job training, child care and small business initiative for NYCHA residents who receive welfare.

The housing authority’s waiver application would have covered 34 housing developments–and contained a scheme to move some NYCHA tenants into private-market housing for the first time. NYCHA planned to halt admissions of welfare recipients to targeted moderate-income developments. Low-income tenants would instead have been housed by private-sector landlords contracted by the authority.

To pay for the scheme, Franco proposed gradually raising the rents on NYCHA tenant households earning about $25,000 a year.

But about 60 NYCHA residents made it to the microphones on Tuesday–and not a single speaker supported the application, which would have deregulated 16 projects located in all five boroughs.

The auditorium was at least 200 seats too small to accommodate the tenants who availed themselves of their only chance to speak during a six-month closed-door planning process. Before its withdrawal, the application was due to be filed with the feds this month even though it was first given to a handful of tenants leaders in early May. Copies of the proposal were not distributed at the hearing.

Franco accused the plan’s opponents of spreading misinformation. “Contrary to what you’ve been hearing, there will be no evictions, there will be no selling off of authority buildings,” he said.

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