Across New York City’s cash-strapped public housing complexes, residents are being presented with two dense proposals intended to unlock funding for repairs. How do they differ?
In recent weeks, the New York City Housing Authority (NYCHA) announced major updates within its Permanent Affordability Commitment Together (PACT) and Preservation Trust initiatives—two programs intended to raise capital repair funds for the system’s deteriorating housing stock.
Late last month, residents at Nostrand Houses in the Sheepshead Bay neighborhood in Brooklyn learned they will be asked to vote in November on whether their development should participate in either initiative: by becoming the first campus to lease its buildings to the newly-formed Trust, or joining tens of thousands of public housing units that have already been converted to private management under PACT.
Last month, the Department of Housing and Urban Development (HUD) announced a near $1 billion investment, the PACT program’s largest transaction to date, at the Edenwald Houses in the Bronx. And in June, after a vote, officials moved forward with plans to demolish and rebuild Chelsea-Elliott and Fulton Houses, also under the PACT.
Both PACT and Preservation Trust are implementing a strategy that aims to modernize public housing properties with deteriorating conditions. A recent Physical Needs Assessment (PNA) determined that NYCHA needs an estimated $78.3 billion to make capital repairs across its more than 300 campuses—including new flooring, windows, kitchen appliances, upgraded outdoor spaces and security systems—a 73 percent increase since its last assessment five years earlier.
These changes are more complicated than just renovations, however: both funding plans involve converting NYCHA units from federal Section 9 to a federally funded Project Based Section 8 program—and in the case of PACT, to new management.
So, what are the differences between PACT and Preservation Trust? How will residents be impacted? And what could NYCHA look like once the initiatives reach their goals, which officials say is expected to happen by 2028?
Here, City Limits breaks down the acronyms shaping NYCHA’s future.
A history of disinvestment spurs RAD
The Rental Assistance Demonstration (RAD) program was introduced in 2011 under the Obama administration. As public housing authorities across the country age and deteriorate, RAD is one of the federal government’s solutions to help financially support these housing agencies and pay for needed repairs by leveraging private capital, rather than relying on the political whims of Washington to deliver adequate funding, something Congress has largely failed to do for years.
The first housing development in NYCHA was built 88 years ago, in 1935. As more campuses were constructed, the housing authority was not only praised for providing secure homes for low-income families but also building communities.
Some structures were low-rise walk-ups, while others were high-rise towers. Though taller buildings could house more families, managing them all proved to be a challenging feat: The Preusse Report of 1957, constructed by a city administrator under then-Mayor Robert Wagner Jr., mentioned that several buildings were already in a state of “disrepair” and had an “enormous backlog” of maintenance jobs.
High-rise housing developments continued to be built throughout the majority of the 1960s and ’70s. In 1999, the Faircloth Amendment was enacted to limit the number of properties a public housing authority can own and manage. As a result, construction projects were paused.
NYCHA, along with other housing authorities nationwide, then saw years of funding cuts and disinvestment that led to worsening conditions such as mold, asbestos and the presence of lead paint.
Between 2000 and 2013, more than 50 percent of the funding to rehabilitate public housing was cut, according to a study by the Human Rights watch in 2022.
Nationally, more than 200,000 units have been converted under RAD in cities including Baltimore, Charlotte, Chicago and San Francisco, according to HUD, including tens of thousands of apartments at NYCHA in the last several years.
Permanent Affordability Commitment Together
In New York City, RAD is known by another name—Permanent Affordability Commitment Together (PACT).
The program was part of the Next Generation NYCHA plan, a 10-year strategy unveiled by then Mayor Bill de Blasio in 2015 to help rebuild and fund housing developments and surrounding communities.
PACT officially launched that year with Ocean Bay (Bayside) Apartments in Queens, the first campus to undergo the conversion.
Through long-term leases with private developers, Section 9 public developments are converted to Project-Based Section 8 properties. This public-private partnership, officials say, allows the private entity involved to access other revenue streams that NYCHA can’t tap into on its own—like tax credits, mortgages from banks and bonds issued through the New York City Housing Development Corporation—to fund repairs.
NYCHA maintains ownership of the buildings. However, private developers and management companies—selected based on resident input, officials say—manage the overall maintenance services under PACT. For instance, NYCHA repair requests, or “tickets” are handled by the developer.
The program is designed so that residents keep their public housing rights, such as paying 30 percent of their adjusted income toward rent, succession rights to their units and the ability to organize.
Still, PACT has been met with a fair share of skepticism from critics who argue the involvement of private entities puts tenants’ at risk: converted campuses are removed from the purview of the federal monitor that was put in place in 2019 to oversee NYCHA improvements, and analyses of eviction data at some of the first developments to join the program saw higher eviction rates. Complaints have also been raised abut some of the private management companies put in place.
PACT has also complicated the process for tenants seeking to transfer apartments, including for health and safety reasons, with residents living in PACT campuses being told they can only transfer to units overseen by the same developer or private management company, City Limits previously reported. Wait times for vacant NYCHA apartments have surged this year, as the number of approved emergency transfers declined, housing authority data shows.
More than 37,000 units have either been converted already under the PACT program or are in the pipeline for conversion—more than halfway to NYCHA’s goal of 62,000 apartments by 2028—what the authority said represents more than $8 billion in repairs for those campuses.*
Public Housing Preservation Trust
Last June, Gov. Kathy Hochul signed the Preservation Trust initiative into law to help modernize an initial 25,000 NYCHA apartments. The end goal is to convert 110,000 apartments.
Similar to the PACT program, the Preservation Trust is designed to access additional revenue to make necessary fixes: The trust, a new public entity, can issue bonds to raise funds. It can help properties get additional federal funding through Tenant Protection Vouchers (TPVs), which are worth double NYCHA’s current federal subsidy.
TPVs are used when a unit is undergoing major renovation. The money can go toward hiring third-party contractors who officials say can perform fixes at a more rapid pace than at traditional NYCHA campuses, where it took the housing authority an average of 357 days to complete repairs in July.
Tenants will still pay 30 percent of their income toward rent following a trust conversion, and NYCHA will continue to own and manage the properties. Instead of a third-party private developer, the method PACT uses, NYCHA will enter a long-term lease with Preservation Trust itself.
The Trust currently has a board of seven members with NYCHA’s Chief Executive Officer, Lisa Bova-Hiatt, as the chair. Appointees also include two other city housing officials, two tenant association presidents and a member “at large.”
NYCHA residents whose developments are not already part of PACT are eligible to vote in future elections, to take place one at a time at campuses selected by NYCHA. In the vote, residents can elect or decline the option to be part of PACT, Preservation Trust, or to continue on in traditional Section 9. At least 20 percent of households at a given campus will need to take part for the voting results to stand.
Nostrand Houses in Brooklyn will be the first campus to hold such a vote, which will take place over the course of 30 days starting in November.
Do you have additional questions about NYCHA’s PACT or Preservation Trust plans? Send them to NYCHA@citylimits.org, and our reporters will look to answer them in future coverage.
We’re also looking to hear from tenants at existing PACT campuses about their experiences with the program. Send us a note!
*This story was updated after original publication to include additional details on PACT conversions.