Last week, Harlem political heavyweights and departing federal housing officials announced an elegant plan to rescue about 465 brownstones that have been pillaged, exploited, and left for dead through scams carried out under the federal mortgage insurance program known as 203(k). Larded with cash from the flush Federal Housing Administration insurance fund and reliant upon the expertise of some of the city's most admired nonprofit housing groups, the plan looks like salvation for both vulnerable low-income tenants and fragile housing stock:
The federal Department of Housing and Urban Development, after taking title to the buildings, will pass them off to nonprofits for a nominal cost. The nonprofits will manage the occupied buildings (tenants will pay no more than 30 percent of their income) and sell the vacant ones off to families, with preference given to upper Manhattan residents who make up to $79,000.
HUD will pay back the banks that now hold the mortgages, pay for all repairs, and provide the nonprofits that will be overseeing the buildings with management, development and marketing fees. (Abyssinian Development Corporation will oversee the process in Harlem, and East Brooklyn Congregations in Brooklyn.)
It's quite a victory. Now, there's just one thing left to do: make it work.
That won't be easy. The scams have left a messy legal tangle in their wake. It could take HUD 18 months or longer to get control of some of the properties. In the meantime, the nonprofits involved in the scandal still hold the titles and are actively trying to sell some of the brownstones to unwary buyers. (“There's nothing that HUD, you, I or any of these people can do to stop them,” said Abyssinian's Darren Walker, an architect of the plan.) To top it all off, several of the plan's principal masterminds at the federal Department of Housing and Development, as well as the department's top brass, will be out of their jobs today as the Bush Administration takes over.
There are practical pitfalls as well. The buildings are a motley lot, left in various states of disrepair: Some are untouched, some partly fixed and boarded up, and some have been gutted. And at this point, nobody knows exactly how many properties are involved–or who lives in them.
At a raucous meeting last Wednesday, top HUD representatives, Harlem pols, and representatives from Abyssinian presented the plan to about a hundred frustrated and skeptical Harlem tenants and local activists. The officials, pledging repeatedly that no tenant would be evicted, also promised to quickly address all the buildings' maintenance problems.
The deal–and those promises–are impressive, says Elizabeth Kane of the Westside SRO Law Project, which initially discovered the scam. But she worries that even as housing officials and politicians promise that no tenant will be ousted, the devil is in the details. In reality, they have no way to enforce that promise until HUD takes over the buildings, and even then the going could get very complicated. “There's an enormous amount of work ahead of us to make sure it's implemented in a way that's as good as its word,” she said.