No one, save a few meteorologists obsessed with global warming, was expecting 75-degree weather this December.
Carlota Reyes certainly wasn't. So she found herself one recent afternoon in the scorching basement of her apartment building in Washington Heights learning how to turn down her boiler to compensate for the long Indian Summer. Unlike most apartment dwellers in the city, Reyes and the other tenants in her 35-unit building own the apartments they live in–so they want to keep expenses low. “We're spending too much money on oil,” she says.
Had it not been for the city's Tenant Interim Lease (TIL) program, Reyes probably would have just opened her windows and let the landlord's money waft out. But 12 years ago, Reyes signed up for TIL, a city housing program that provides low-income tenants with funding to renovate their buildings if they agree to take over and manage the apartments as co-ops.
TIL is one of the city's most successful community development initiatives, having transformed more than 600 dilapidated buildings over the last two decades and brought thousands of poor and working-class tenants into the ranks of homeownership.
But if the program has been a paradigm of tenant empowerment, Reyes' building is also an example of the traumas TIL can visit on residents who are unprepared for the rigors of management.
In Reyes' case, the problem was that the first generation of elected tenant leaders had poor oversight over the building's finances. Due to their bad financial planning–and the failure of the city to properly train tenant leaders–the building's taxes and bills piled up a six-figure debt. Finally, when Reyes was elected head of the tenant association, she started untying the financial knots, putting in the six-hour work days that are typical of committed tenant-managers. Still, it was only by securing a $160,000 loan from the Community Service Society that she was able to keep the building from being repossessed by the city.
Reyes notes that for the second year in a row, no one stole-or even vandalized–the Christmas tree in the lobby, a barometer of her success. “We're going to save this building,” she says with absolute certainty, eyes locked on a reporter. “Everything is done. Insurance. Inspections. New boiler. New roof. The windows are going to be fixed. People are happy.”
On balance, most TIL tenants are happy with the program. But as supporters celebrate TIL's 20th anniversary, critics are questioning how well-managed the buildings–and the program–are.
In September, City Comptroller Alan Hevesi delivered a perverse anniversary gift: a scathing audit reporting that many of the program's buildings suffer from poor oversight and deteriorating conditions. “Simply stated, a large number of these buildings have not succeeded in any way, shape or form,” wrote Hevesi's auditors. “Many of the buildings have . . . deteriorated and are probably in the same or worse condition than before they were renovated.”
TIL's ills, Hevesi reported, stemmed from confused management, insufficient guidance for newly formed tenant-run co-ops and general sloppiness in the operation of the program. The problems mean that TIL buildings now owe millions of dollars in back property taxes.
But the report hasn't provoked the city Department of Housing Preservation and Development (HPD) to pull the curtain down on the program, to the relief of tenant activists. “TIL is considered to be one of the basic programs in HPD,” an high-ranking agency officials told City Limits, echoing the opinion of several other agency sources. “It is considered to be essential by this administration.”
Instead, the program may be facing an even bigger challenge. Soon, there may few buildings left to renovate.
Since the Giuliani administration stopped seizing tax-delinquent apartment buildings four years ago, the stock of apartment buildings available for TIL has dwindled. And that means within a few years–nobody is exactly sure when–there will be no more city-owned buildings for tenants to take over. Meanwhile, TIL supporters must compete with the city's other housing preservation programs for the trickle of apartment houses still in the pipeline.
“I get the feeling that when the Giuliani administration leaves, they're going to be turning out the lights on TIL and the rest of HPD, for that matter,” says Joe Center, a longtime housing activist on the West Side and Harlem.
The Tenant Interim Lease program, and its core philosophy of involving tenants in reclaiming their neighborhoods, is a product of an era when New York City's government lost control of its ability to deal with the wholesale disintegration of its poorest neighborhoods
New York City's housing problems during the 1960s and 1970s were rooted in white flight and the concentration of poor blacks and Latinos in substandard housing. But it was the city's palsied response that made the crisis a cataclysm.
Until the late 1970s, the city repossessed buildings when landlords were delinquent with tax payments. The buildings were then auctioned off to new owners, giving the city a quick way to recover tax cash. But many of the buildings were bought up by speculators who purchased them for a pittance, then did little more than collect rent. Few invested in maintenance or repairs and, ultimately, the rotting apartment houses would be repeatedly repossessed and auctioned off.
Trapped in this cycle of abuse, hundreds of buildings became so run down–scarred by vandalism, water damage and fires–that even the poorest tenants abandoned them. Around that time, a handful of guerrilla homesteaders began occupying and renovating discarded buildings. Eventually, they started organizing tenants, spreading the mantra of self-help and neighborhood rebirth.
Considering how unprepared city bureaucrats were at the time, it was inevitable that housing officials would, at some point, turn to the homesteading movement for help. “No one sat around a big table and planned this,” explains Harry DiRienzo, a pioneering homesteader in the South Bronx who helped found Banana Kelly, one of the most successful community revitalization groups to emerge from that era. “It was the height of the housing movement and the city's attitude was, 'You wanna take over some buildings? Hey, go knock yourself out. We don't want 'em.'”
The program started off modestly, in the Cathedral of St. John the Divine, with homesteading veterans counseling interested tenants in the art and craft of hardscrabble rehab. Originally, residents would do the renovations themselves, using their “sweat equity” to get the buildings into habitable shape. As the program gained momentum, the city combined local tax revenues with federal grants to gradually increase the amount of repair dollars per unit from $2,000 at the time to around $45,000 today. “It was very exciting–we had 10 to 20 buildings coming into the program every month,” recalls Andrew Reicher, executive director of the Urban Homesteading Assistance Board (UHAB), which was formed to provide technical help for squatters in the early 1970s. “It was one of those rare coincidences: The city wanted this to happen, the tenants did, and the housing community did.”
(As a matter of full disclosure: Reicher is City Limits ' board president and sublets space to the editorial staff. However, at the behest of its board, City Limits has always maintained a policy of strict editorial independence.)
Since the first building made through renovation into tenant ownership in 1980, the program has grown steadily. About 50 new buildings now enter TIL program each year, while another 50 graduate out. At the moment, 173 buildings are in the pipeline, and 60 are waiting to have their applications to enter the program approved.
To get into the program now, residents in city-owned buildings form a tenant association, elect officers and establish bylaws and guidelines. When 60 percent of a building's residents agree to join the co-op program, the group applies. If their application is okayed, at least half of the tenants must go through a series of orientation and training classes run by UHAB and other nonprofits, where tenant leaders are taught financial management, maintenance, and repairs.
In the meantime, tenants collect rent, pay for minor repairs, accrue a small rainy-day reserve and file their financial paperwork with HPD to prove that they are up to the task of running a co-op. Once the agency agrees, it releases the rehab money.
The renovations can take two to three years, and then tenants can purchase their apartments at the bargain-basement price of $250.
Converting a building from a run-down city-owned rental property to a private co-op is a difficult and dangerous enterprise. TIL doesn't always assure a happy ending.
According to Deputy Comptroller Roger Liwer of Hevesi's office, 28 of the 45 TIL buildings that went co-op between July 1995 and 1996 are in tax arrears. Fifteen of those buildings are in danger of tax foreclosure and a potential return to city ownership, he says.
All told, TIL co-ops owe $15.3 million in back property taxes. The problem, the comptroller's office concluded, was poor management on the part of tenant associations. Many are unwilling to raise rents–known in the co-op world as maintenance fees–when the buildings need more money. The tenant-owners take money slated for water bill or property taxes and spend it on repairs or other unexpected expenses.
At the root of the problem, Hevesi alleges, is that HPD has overestimated the rent rolls of many buildings before handing them over to tenants. In one instance, auditors found that a rent roll had been estimated at four times its actual cash flow.
HPD, in a pointed response sent to City Limits, argued that Hevesi's calculations failed to mention that just 18 of the 352 buildings cited as tax deadbeats in the audit accounted for one-third of the total TIL tax bill.
Still, HPD's TIL director Elba Ramos conceded in the letter that debt wasn't the program's only problem. “Indeed, there are sold TIL buildings in tax arrears and disrepair,” she wrote.
Some TIL tenant-owners–especially those who were accepted to the program before HPD had become so generous with its repair budget–say the agency handed them damaged goods.
On the third floor of 41 Convent Avenue in Harlem, eight tenants work diligently every day running the 79-unit St. Agnes apartment house, a 90-year-old grand dame of a building.
HPD's fix-up job, which ended when the place was sold to the tenants in 1995, wasn't enough to undo the damage done by decades of indifferent landlords and government ownership. The elevator runs on an antiquated electrical line that results in astronomical Con Ed bills. The plumbing is poor, residents say, hiking water rates and sewer bills.
“The city said to us, 'You either buy it as is, or it will go back to the city,'” says Sophie Johnson, president of the tenant's association. “We've struggled too long for that to happen again.” So far, Johnson and her small cadre of neighbors have done well: They have hired their own security, accountant, bookkeeper and clerk and are now shopping for a loan. They're also considering raising rents to do new repairs.
Other buildings have not been so lucky. Since TIL's inception 116 buildings–12 percent of the total admitted into the program–have failed and fallen back into city management.
But all of these problems pale in comparison to the threat posed by the city's new anti-foreclosure policy. The four-year-old moratorium on seizing buildings, part of the Giuliani administration's budget-cutting strategy, has made for an ironic situation. For years, tenant advocates complained bitterly about the shoddy upkeep of city buildings. Now, they fear that without any new city-owned tax delinquent properties, there will be no more free buildings to rehabilitate.
In the last year alone, the city has shed nearly 250 buildings with some 4,000 units from its portfolio. The competition to enroll the remaining buildings has become fierce–and will get more intense as the supply dries up completely during the first years of the next century.
The most intense competition for buildings has taken place between TIL and the three-year-old Neighborhood Entrepreneurs Program (NEP), which uses government money to renovate buildings that are later handed over to pre-selected private landlords. TIL supporters have long feared that NEP, run by the powerful New York City Housing Partnership, would siphon off the best remaining buildings. In reality, almost the opposite has happened: NEP tenants have been taking advantage of their right to opt out of their program and into TIL. “We're seeing a lot of that,” says UHAB's Andrew Reicher. “The tenants would rather get into an ownership program than go back to a private landlord.”
In fact, HPD sources tell City Limits that the flood of NEP buildings into TIL has gotten so large that about 80 buildings were accepted into the tenant ownership program last year-compared to the annual average of about 50.
Nonetheless, if TIL is going to continue to justify its share of buildings, the program will have to rehabilitate its own image. And that will be hard to do.
It is likely that TIL will always be one of the city's most chaotic housing programs, simply because it is more ambitious. It is a petrie dish of big ideas, philosophical flourishes and competing objectives, including tenant empowerment, building repair, community building, homeownership and, now, budget cutting.
“With TIL, self-management requires commitment and skill,” says Jackie Wilson, head of the United TIL Coalition of Harlem. “Democracy is slow. If you want everybody to take part, it takes time.”
By contrast, NEP and another housing preservation program called the Neighborhood Revitalization Program (NRP) rely on the expertise of seasoned landlords and community groups to do the most difficult work and, hence, will always be more streamlined enterprises than TIL. But neither of these programs can accomplish what TIL does when it works: building neighborhoods and providing permanent homes for low-income tenants.
“There's a lot of pain and suffering, but I'm happy,” Carlota Reyes says. “To me, this has been a powerful experience, convincing people that we can save this building if we really want to. The doors are open, if you're willing to solve the problem. But your mind must be open.”