Between 1955 and 1978, the state’s Mitchell-Lama Housing Program produced about 135,000 units of affordable housing statewide by offering low-interest loans and tax exemptions to developers to build affordable rental and cooperative buildings. Yet as developments paid off their initial mortgages and reached the end of the 20- to 35-year initial term of the program, thousands of Mitchell-Lama buildings have privatized, reducing the total program stock to less than 97,000.
The City Council held a series of hearings during the height of the exodus—in 2000, 2003, 2009—but oversight waned as the recession cooled the privatization frenzy. As the housing market heats back up, the city once again faces the threat of losing units.
On Monday, about 300 people packed Brooklyn Borough Hall to discuss the state of the city’s Mitchell-Lama developments. The four-hour hearing, convened by the Committee on Housing and Buildings and co-hosted by Borough President Eric Adams, began with the beep admonishing the two agencies that manage the program. “The New York City Department of Housing Preservation and Development and the New York State Division of Housing and Community Renewal must do more to support these developments and protect the affordability for current and future residents,” Adams said.
But he added that the City Council also bears responsibility for the lack of oversight of the Mitchell-Lama program, which faces seven broad problems, according to tenants who testified.
1. Skipping the lines
Since 2008, three separate audits (by the state comptroller, the city comptroller and a state inspector general) have shown many Mitchell-Lama developments fail to comply with rules governing admissions to vacant apartments, such as by failing to follow the order of applicants on the waiting list.
HPD has pledged to digitize waiting lists to provide more transparency, and has hired two new staff members to ensure building managers are in compliance. HPD Assistant Commissioner Julie Walpert explained that HPD ensures applicants who have been wrongly skipped receive priority for the next opening apartment.
The Committee on Housing and Buildings was not too pleased with the progress of reform. Jumaane Williams, chair of the committee, expressed frustration that the department did not have an aggregated list of skipped applicants, or a list of people complaining they have been skipped. Councilmember Helen Rosenthal urged Walpert to ask the City Council for funding so that the agency could start putting waiting lists online.
2. Untrained boards
At cooperative Mitchell-Lamas, which make up two thirds of the city’s Mitchell-Lama stock, a board of directors makes key decisions about finances and management. Elected officials were appalled that HPD had discontinued its training program for board members.
“Why did you stop?” Williams asked.
“Resources,” answered Walpert.
“That’s not good. Did HPD request any resources from the city to continue the board training?”
“We did not, no.”
Asked when exactly the training program had been discontinued, Walpert couldn’t recall.
3. Suspect elections
Shareholders from multiple developments complained about undemocratic election processes. About a dozen residents of Lindsay Park—where the board is currently under investigation for corruption by the Brooklyn District Attorney—complained about mismanagement by their board, which they believe has stayed in power for over a decade using an unfair “proxy” system in which residents are encouraged to sign over their voting privileges to others. Board President Cora Austin has repeatedly rejected the charge that the proxy system is unfair, and in 2014 HPD told DNAinfo that the building’s proxy system complied with HPD rules.
City Council members clearly wanted HPD to take more responsibility for correcting problematic elections, but had difficulty pinpointing how HPD should change its policies. Walpert said HPD is committed to ensuring boards are elected fairly and that the agency overlooks all election documents to ensure they comply with each building’s bylaws, but that she had no legal power to ban a proxy system.
4. Exiting co-ops
While about half of the state’s rental Mitchell-Lamas have left the program, cooperative Mitchell-Lamas can only exit through a supermajority vote by shareholders and so far only 7 percent of cooperatives have left the program. Yet privatization can be tempting to shareholders: while residents in Mitchell-Lama cooperatives can only sell their apartments at the price they bought, privatization allows shareholders to sell their apartments at market rates.
HPD has negotiated with many Mitchell-Lama landlords and cooperative owners to stop units from exiting the program. Currently, about 70 Mitchell-Lamas in HPD’s portfolio are locked into a regulatory agreement, while another 20 are at risk of privatization. Five of those twenty, including one rental and four cooperatives, have expressed interest in privatizing.
Walpert said HPD works to inform shareholders about the consequences of privatization, and the agency has increased the number of votes required to leave the program. HPD also offers a program called “Article II to Article XI,” which allows Mitchell-Lama cooperatives to transition into a program that restricts sales of coop units to families within a specific income range.
Yet Joyce Stickney, a resident of Saint James Tower, said HPD was unwilling to inform her building’s shareholders about the risks of privatization. “I said to HPD, aren’t you going to come out and give us some straight, unbiased information?” she testified. “They said: we can’t because we will get sued by your board. We have been sued by other boards.”
Other shareholders, representing the anti-privatization organization Cooperators United for Mitchell-Lama, called on legislators to institute new policies to restrict privatization, such as by forbidding privatization at coops receiving municipal tax abatements, and eliminating the Article II to Article XI program.
5. Decrepit buildings
As Mitchell-Lama developments age, many fall into states of disrepair. An investigation in October found that rental Mitchell-Lamas make up five of the top 12 subsidized developments with the worst mold and vermin violations.
Walpert said that HPD conducts periodic physical inspections to make sure properties are maintained and has helped Mitchell-Lama developments obtain loans to address capital needs. In the past, HPD has said that at some complexes, rent increases have not kept up with rising operating costs, leaving landlords lacking funds to make repairs. In De Blasio’s Housing New York plan, the administration vows to work with the state to find new funding streams and to encourage landlords to develop underused property in order to pay for repairs.
Yet residents complained about HPD’s response time to violations, and Williams wanted to know whether HPD should hire more inspectors. Gale Brewer called on HPD to make forgivable loans available to Mitchell-Lamas to prevent residents from shouldering the costs of repairs.
6. Sudden rent increases
To pay for repairs—or take on new debt in order to remain in the Mitchell-Lama program—many Mitchell-Lama residents say they have suffered sudden increases in rent and maintenance fees. Mary De Suze, a resident of Linden Plaza, disputed the legality of a 93 percent rent increase that hit tenants after the landlord took on a new $50 million loan to pay for renovations.
Some residents from Lindsay Park said that in 2008 they’d accepted a 31.5 percent increase in maintenance fees to cover repairs that never materialized; they were told after the fact that the increased revenue had been appropriated to pay the costs of emergency repairs. In 2012, residents said, they accepted another increase of more than 20 percent.
Brewer called on HPD to provide more oversight of rent increases. She mentioned three buildings—Independence Houses, Tanya Towers, Clinton Towers—where she says landlords asked for rent increases based on faulty calculations or improperly filed for an increase.
Betsy Eichel, a tenant organizer at Housing Conservation Coordinators, Inc., recommended that buildings should have their yearly rent increases tied to the Rent Guidelines Board’s limits on rent increases, an idea Julie Walpert also proposed last year.
7. No complaint process
Asked how residents can register a complaint about their development, Walpert said there were plenty of ways to get in touch.
“They can call us. They can e-mail me … There’s a Mitchell-Lama e-mail address…I have property managers assigned to each development. They can contact the individual property managers on my staff. They can call 311.”
Asked if complaints are given tracking numbers, she explained, “When they come in, depending on how they come in, they’re tracked with different tracking numbers, so it depends on what the issue is.”
But some residents complained of a lack of a clear process to report grievances. Linden Plaza resident De Suze said that when she contacted Walpert and another HPD official, she never received a tracking number.
City Council members also called for more coordination between Walpert and HPD’s Inspector General. Walpert said that she regularly refers hundreds of complaints to the Inspector General and communicates frequently with that office, but she did not know how often complaints had been dismissed and how often they had been successful.
HPD certainly heard the complaints offered at Monday’s hearing: Contrary to what some on the dais perceived, agency representatives remained at the hearing after Walpert’s testimony. The place was so full of concerned tenants, however, that HPD had to listen from the overflow room, according to a spokeswoman.
21 thoughts on “The Seven Worries of New York City’s Mitchell-Lama Tenants”
I’m wondering what’s going on with the Masaryk Towers 1-bedroom waiting list. While the 2-bedroom, studio and 3-bedroom lists are moving forward, the 1-bedroom list moves in reverse. At one point in 2016, someone posted in a forum that he was told that the 1-bedroom list was at #31. A few weeks later, another person posted that that she was told the 1-bedroom list is at #27, not #31. If you look on the the Mitchell Lama list that is posted online, it indicates that the 1-bedroom list is only at #17. The lottery for the 1-bedroom was held in 2014, so this is extremely slow movement. The office also has indicated that there is an internal list, which is being filled along with the lottery list. This seems like an impossible situation for those on the 1-bedroom lottery list because almost everyone approved for a studio is also eligible for a 1-bedroom. And if the studio shareholders have precedence over those on the 1-bedroom lottery list, then the 1-bedroom list is never going to move. It seems only fair that if a studio shareholder is offered a 1-bedroom before someone on the 1-bedroom list, then the next person on the 1-bedroom list should be offered a studio.
Can sameone tells me what is going on with the Masaryk Towers? I’m on the waiting list for 3-bedroom from 2014 lottery. My lottery number is below the number 20. I called the manager office at the end of 2016. The person in the office told me that they have sent me a letter in the middle on 2016 for the 3-bedroom that was available and that they did not get a answer. The problem is I never get any mail from them, that means I lost my place on the waiting list and need to wait for another list for the 3-bedroom availibility. The funniest thing is that when we sent a application together with the money order they also required a phone number and an email address. Why didn’t we receive a call or a email from them? When I look on the Mitchell Lamas lists that are posted online, it indicates that the 3-bedroom list is already passed my lottery number. I keep calling them every month to find out if there is a 3-bedroom availible, every time the answer is that what they have now is for the inside people due to a family size increase.
Can I get a answer from a city council or any one who represents Mitchell Lamas?
You can call and complain to HPD and you can be put back on the list and you will be number 1 as this happened to me. This seems to be a common thing that they do. Do not hesitate to complain and you will get the next available apartment,
Who do you recommend to contact regarding Mitchell Lama wait list issues?
I’m a long-time owner on St. James Pl., just a few blocks south of St. James Towers, and I will be at the vote to buy out of the Mitchell Lama program because I’m concerned about losing affordable housing, especially for senior citizens.
Sunnyside manor in Yonkers show apartments in despicable conditions and sell them “as is”. However, when people move out, they have to pay for at least three month rent, because they do not try to sell your apartment. Also they charge for every little thing and reduce you investment by any amount they want. The hallways and garages are worse that housing apartments. The apartments have leaks, mold, asbestos and other problems. The rent is very high. I think is much better to buy your own apartment and sell it at a market price than to invest for 3 bedroom apartment about 20k and get a lot less than what you invested when you move out. WHAT A RIP OFF.
Exactly! I moved out of a State Mitchell Lama coop . Concourse Village. After Unit was sold 2 years later.. I was charged for new cabinets floors and thousands of dollars in bogus repairs, along with 3 months maintenance by default. The whole point of this program is to get a working person who is willing to give these fake co-ops $20,000 or more to purchase an apt in the projects and then when They move out … bogus repairs are claimed and the Board of Directors gets to steal the proceeds . If u want s Coop then buy a real Coop which you can sell to anyone you like
The same is happening to me right now. I wouldn’t recommend Concourse Village to my worst enemy. Biggest scam and headache ever! I’m going to fight them in court if I have to. Wouldn’t be surprised if there ends up being a class action.
I’m having the same problem. They continue to give me the run around every month. Today i was told they are calculating to see if I’m even getting anything back. They just tells me they plan on giving me nothing after waiting over 2 years. People should not move into thear Mitchell llamas.
I’m wondering why DHCR is resistant to shareholders exploring the conversions of Article 2 to Article 11? Why should residents who have paid off mortgages for 40 years not be entitled to a moderate increase in their equity. They have never received the 6% dividends that were promised to ML residents in over 50 years.
It’s about time for ML residents to claim a return on their investment just like any other type of housing.
Why does no one realize 2 Mitchell Llamas Dayton Beach Park & Dayton Towers living side by side are not being run the same? Dayton Beach Park has become a cesspool while Dayton Towers is thriving and a wonderful place to live. Complaints to HPD, DOI and elected politicians have landed on deaf ears. We no longer have security, one of our swimming pools have been ripped out, no open board meetings. Questionable elections,
Harvesting of apartments and on & on. I have lived here 27 years and now realize I chose the wrong corporation to live in. We can not live in Dayton Towers because the lists are too long. Is anyone, anywhere going to do something?
I’ve lived in Masaryk towers for about 45 years now. here located in the lower east. I must admit when i first moved in the neighborhood was pleasant and the living conditions as well. Unfortunately, things change throughout the years and things are no longer the same. I’ve seen people move in that have no businesses in being here. They look like there are into drugs, just by looking at them, they smell weeded out, and their the same ones bringing drugs into the buildings. The management office must be facilitating subletting because, many people have lost their number on the waiting list. I’ve caught security in the past smoking weed in the basement…i mean the list goes on. Many tentants have certain keys they shouldn’t have, and theres this favoritism for all those that stay with in this click..Theres no transparency what so ever, things are done under handed, and you has a shareholder are not considered or valued. Very sad for a place that had great Potential in the past.
I’m currently waiting for my equity after moving out of Concourse Village in 2016. The process of screening applicants to take over the apartment is questionable as well as the fact that exiting coop owners have to wait for the apartment to be sold in order for the former owner to receive what will likely be a substantial loss. I’m with KD and Joan. I don’t trust them at all! I call every 2 weeks to check on the “progress” and I am told the applicants did not meet the criteria or approval. The process of vetting applicants need to change and existing owners need to get paid interest on the monies that are held instead of incurring such losses on renovations that should not be our responsibility. I feel a class action suit should be filed by exiting owners awaiting their equity and those who were underpaid when the apartment is sold. I’m going to do research and call local officials. I’m ready if anyone is interested in discussing!
Do you receive the same equity you paid to get the apartment? Wow, that’s crazy because if you buy a regular apartment, its value would appreciate with time.
Back in 1981 at the Cadman Towers in Brooklyn Heights my family were moving out and ask the new potential tenant for $8000 for a teak wood floor we put on the linoleum floors tenant offer $2000 so there was a legal dispute with the management that lasted 2 years and we lost. But unknown to us at the time that the 9/11 attacks was only 20 years in the future so this actually turn out better that we left win or lose because it was a short distance from the toxic plume that went over lower Manhattan and downtown Brooklyn. Speaking spiritually it was divine intervention when you do ugly.
I just received a BILL -AMOUNT DUE from Concourse Village from the sale of my “coop.” I agree with the previous writers about the bogus repairs. I’ve also waited almost 3 years after constantly contacting their office and was given the run around. The last email response I received was from the general manager, which stated that she would work on my file. I’m all for initiating a class action suit against them and I plan to register a complaint with the State Attorney General, the State Housing agency and whatever other government agencies I can find to investigate and hold them accountable and responsible for robbing former coop owners. If anyone is interested in beginning a class action suit let’s join forces. I’ll post my email if anyone says they’d like to go forward with this.
Definitely, a group from the Brooklyn Task Force formed MAAC “Mitchell Lama Affordability ánd Accountability Coalition” to bring a Class Action against DHCR ánd HPD but didn’t get enough support. Please contact me at 9172449224.
I recently moved out of Co-Op City because I was lay-off from my job due to COVID-19. I got charged for 3 months maintenance fee along with the following: $65 for three rooms for not removing the carpets. That was not mentioned on the contract when I moved in. $65 to remove the stove, $200 for two walls that I painted with a light lilac color, and $100 for each window because I screw the shade to the frame. So I had 7 windows so another $700 dollars. No job and all they want is your money. Beware of CO-OP City in the Bronx. They will steal your money.
Did returned your fare share financial investment as they promised? Im going through the same thing right now , trying to withdraw my shares
Hello sorry for your troubles did they charge you $200 for 2 walls or for each bedroom
Does anyone know what’s going on with these wait lists?
– Nagel House
– Amalgated Housing
– Park Reservoir
– 1199 Housing – East River Landing
I’ve been on their lists since 2016 and 2017 for studio and 1 bedroom.
I’m currently in the 20s with Nagle House and 70s with 1199-East River.
With Amalgated, 2 weeks ago I was in the 130s. Now I’m in the 140s.
With Park Reservoir, 2 weeks ago I was in the 250s. Now I’m in the 270s.
It seems to be moving so slow, and I don’t understand why my spot moved down the list with Amalgated and Park Reservoir.