The Low-Income Housing Tax Credit (LIHTC), a federal subsidy, has created and preserved affordable rents for decades. Now, its expiration could force residents out.

This story was produced as part of a capstone reporting project at NYU’s Arthur L. Carter Journalism Institute, with editing by Professor Donna Borak.

In 1994, a young man named John Leyva, who was working for New York City’s Board of Education, signed a lease for a two-bedroom apartment in Carroll Gardens. It had everything he needed and was just a 10 minute walk from the nearby subway station. His monthly rent was $604.

Leyva, now 54 years old, still calls the building home. In the 30 years he has lived in his apartment at 63 Tiffany Place, he graduated from St. Francis College, raised a son, and turned into a passionate community organizer, now deeply embedded in local politics. He has seen his neighbors’ children grow into adults. He has watched those same people, alongside himself, age. A few have died, whose units remain vacant. 

This past Thanksgiving, one of his neighbors dropped off to-go containers of turkey and pie for him and his 16-year-old autistic son. The home-cooked food was accompanied by a handwritten note thanking Leyva for being a great neighbor. “I’m blessed,” he said.

During these last three decades, Leyva and other residents of 63 Tiffany have been able to afford their rents, even amidst Carroll Garden’s swift gentrification, thanks primarily to a federal subsidy known as the Low-Income Housing Tax Credit. Today, he pays just under $1,200 per month, a far cry from the market-rate asking prices for a two-bedroom in the area, with online listings ranging between $3,214 to $6,300 at press time.

This federal subsidy, called LIHTC for short, has one catch: it expires after 30 years. And 63 Tiffany is nearly there.

On March 15, the building’s LIHTC agreement will officially end, removing any federal affordability requirements, at which point the landlord can begin to charge higher rents for many units, threatening to displace residents.

Many units are rent-stabilized, but even the tenants with this added safeguard still fear the possibility of being forced out—whether through efforts to deregulate their apartments or prolonged neglect that makes living conditions untenable, tactics that have worked to displace residents in the past.

“They call it a sunset, I call it a doomsday. Because sunsets are supposed to be pretty, right? There is nothing pretty about this,” Leyva said.

‘Everybody thought we’d have solved this problem in 30 years’

LIHTC was introduced in 1986, and unlike most affordable housing programs in the U.S., it’s administered by the Internal Revenue Service (IRS), the federal agency responsible for enforcing the tax code. Each year, the IRS allocates a set amount of tax credits to each state, based on population size. Every state has an official authority known as the Housing Finance Agency (HFA) that’s responsible for, among other things, distributing these credits to affordable housing developers (though there are exceptions such as New York City, where state-allocated credits are administered by the Department of Housing Preservation and Development, or HPD).

There are two kinds of credits developers can apply for: 4 percent and 9 percent. The 9 percent credits are highly sought-after; it’s common for those applications to commit to 100 percent affordable units, even though they aren’t required to, in order to ensure their proposal is competitive.

The program is the nation’s largest supporter of affordable housing development, and is projected to cost $15.2 billion in 2025.

Developments built using LIHTC must remain affordable for 30 years. Other than this federal requirement, states are given significant leeway to incentivize certain criteria for proposed projects, which allows each state to prioritize its respective housing needs.

Since its inception, the program has been responsible for the development of at least 3.65 million affordable homes across the country. Brittany Webb, the director of research at the National Housing Conference, said that LIHTC is vital in helping fix the affordable housing shortage. “It is the only reason that we are producing affordable housing today,” Webb said.

In 2022, there were 211,168 housing units in New York supported by LIHTC, or 40 percent of the state’s publicly supported rental homes. A significant portion of these were built in the early- and mid-1990s, meaning they will soon reach their 30th year, at which point landlords are no longer required to keep the units affordable.

New York State is expected to lose over 14,000 affordable homes between 2023 and 2028 because of LIHTC expirations, according to data from the National Housing Preservation Database. A rough estimate shows that around 30 New York City buildings will leave the program by the end of 2025, according to data from the NYU Furman Center.

When the LIHTC program was enacted, planners anticipated that the three-decade window would be sufficient. They viewed it as a subsidy that would allow people to get back on their feet and eventually transition to paying market-rate rents.

“Nobody thought that 30 years would not be enough,” said Vicki Been, former commissioner of HPD and a co-faculty director at the NYU Furman Center. “Everybody thought we’d have solved this problem in 30 years.”

But in the decades since, the rising cost of rents—a result of the housing shortage coupled with high demand—have outpaced people’s incomes, Been explained.

Many states like California and Utah require LIHTC developments to commit to a longer time frame of affordability—55 years and 50 years respectively. Vermont requires permanent affordability, the only state to do so.

But housing policy experts warn that Vermont’s strategy isn’t a perfect solution. Buildings inevitably need repairs and renovations, which require funding. When the affordability period ends, that creates an opportunity to secure additional financing or subsidies to cover those repair costs.

“If you’re just seeing permanent affordability, the risk is you become, frankly, like NYCHA, where none of those repairs get made in a timely fashion because there isn’t money for them,” said Been. 

New York City  began offering a 30 year extension—for 60 years of affordability in total—in the mid 2010’s. But it’s only for new applicants, and does not retroactively affect housing built prior, like 63 Tiffany. Mark Shelburne, a housing policy consultant and senior manager at Novogradac, said there is no systemic approach when it comes to making these decisions concerning the length of the affordability period.

“It’s just whether the folks at that agency think it makes sense to do or not,” he said, adding that most people aren’t too concerned over this detail because even the minimum of 30 years feels far away.

‘It would kill me if I have to leave’

Some residents of 63 Tiffany rely on fixed incomes, a worrisome reality as housing costs in their area have skyrocketed. The price of residential properties in Carroll Gardens and Park Slope has increased 121 percent since 2009, according to data from the NYU Furman Center. The real median gross rent has risen 40 percent between 2006 and 2022.

Like many neighborhoods in Brooklyn, this area wasn’t always considered desirable. Cut off by the Brooklyn Queens Expressway, 63 Tiffany can be considered part of Carroll Gardens, Cobble Hill, or the Columbia Street Waterfront District, depending on who you ask. The area, right next to the East River, used to be an industrial shipping hub full of Irish workers, until the industry moved out.

In the 1980s, developers began converting old warehouses into residential units, including 63 Tiffany. But it was an incremental process: when tenants like Leyva began moving in during the 1990s, his apartment building was the only one on the block.

Assemblymember Jo Anne Simon, who represents the district, said tenants like Leyva are part of the reason the area has grown in popularity. Standing outside the building after a press conference on a sunny day in late October, Simon motioned her hand at neighboring buildings, formerly warehouses and now either rental units or condos. “They didn’t move here because this was a hell hole. They moved here because this was a thriving community,” Simon said. “63 Tiffany was very much a part of that.” 

But with its LIHTC agreement expiring in March, residents are anxious about what comes next. On one hand, they fear that their landlord—Irving Langer of E&M Associates, who, through a limited liability company C.H.T. Place, bought the building in 2010—could raise rents beyond what they can afford. At the same time, they worry a sale could bring a new owner eager to cash in on the neighborhood’s rising property values, one who may use aggressive tactics to push them out and replace them with higher-paying tenants. 

Carol Beasly, a non-rent-stabilized tenant, moved to 63 Tiffany over a decade ago and described the neighborhood as “heaven.” Her rent is $1,350 for a two bedroom, but she pays only 30 percent of that cost due to the rent supplemental assistance known as FHEPS. 

She’s not ready to face the possibility of packing up. Others, like Leyva, don’t yet have a plan. 

“It would kill me if I have to leave here now,” Leyva said, his voice trailing off. “I can’t even think about it because I’ll get depressed,” he added with a slight laugh that seemed to mask disbelief. 

As a rental building with more than 10 units, many Tiffany residents will likely fall under the protection of New York’s recently passed Good Cause Eviction Law, which safeguards market-rate tenants from “unreasonable” rent hikes. “Unreasonable” is defined by anything more than the consumer price index plus five percent (as of writing: 8.82 percent), or 10 percent—whichever figure is lower.

But there is one peculiarity concerning 63 Tiffany’s legal status that the attorneys from TakeRoot Justice, who represent the tenants, must consider. After being converted from a warehouse, the building was originally intended to be a condo. There was an official condo declaration in 1992, and when the owner at the time—Related Company—decided to turn it into subsidized housing, the declaration was never retracted. It’s still registered as a condo, even though no unit has ever been sold.

A portion of the units are also rent stabilized. Both of these features—the condo status and rent stabilization—are exceptions under Good Cause Eviction. The attorneys representing the tenants said that every unit, except the rent stabilized ones (which are governed by the Rent Guidelines Board), are protected by the law. Meaning that after the LIHTC agreement expires in March, and once the residents’ current leases expire and they receive renewals, the landlord should not raise their rents by more than 8.82 percent (the law allows tenants to challenge rent increases above that if they’re evicted for not paying).

While TakeRoot attorneys are certain Good Cause applies to 63 Tiffany, they said they must prepare for every possibility, even if unlikely—such as if the building’s ownership, which has a documented history of evicting tenants as reported by The New York Times, attempts to circumvent the law. 

An attorney representing the property owner did not respond to City Limits’ questions about plans for the building after its tax credit expires. 

The push for tenant ownership

Spearheaded by Leyva, 63 Tiffany’s residents have been advocating for passage of the Tenant Opportunity to Purchase Act in Albany and the Community Opportunity to Purchase Act in the NYC Council, known as TOPA and COPA laws. These would require property owners to notify tenants before selling a building, and give them—or a qualified non-profit—the first chance to buy it. Tenants could also sell their purchase rights to a third party, such as a mission-driven nonprofit, which could manage the property on their behalf.

Washington D.C. has had a TOPA law since 1980. The district has developed a modest but productive network of community-based organizations and attorneys to guide tenants through the complex process of purchasing their building or selling those rights to an outside party, though challenges remain.

While outright tenant purchases are rare, advocates argue that TOPA provides leverage and negotiating power, often resulting in affordability extensions or much-needed repairs. Critics point to the challenges, including the funding that’s needed for such large transactions. Without access to money or loans to purchase the building, all the bill does is slow down the market, they say. Some also point out that being a homeowner is difficult, and not something everyone desires.

Elin Zurbrigg, the co-executive director of a D.C. non-profit called Mi Casa that assists tenants with the TOPA process, stresses the importance of D.C.’s Local Housing Production Trust Fund, which has been a key source of financial support. “What makes TOPA and COPA powerful is having the funding available to make it meaningful,” Zurbrigg said. 

At the rally in late October, Leyva and 63 Tiffany’s tenant association were joined by community members and city officials advocating for the passage of both bills, and demanding that landlord Irving Langer negotiate with them. 

Assemblymember Marcela Mitaynes, the primary sponsor of New York’s TOPA bill, spoke to the crowd of around 50 people, saying the legislation would help prevent displacement and preserve affordable housing stock. She also said it would help thwart speculative real estate practices, such as when companies over-leverage buildings, evict the low- and middle-income tenants, then bring in new tenants who can pay more in rent, allowing them to cover the loan.

63 Tiffany’s tenant association said it had an earlier  agreement with C.H.T. Place establishing quarterly meetings and committing each party to ongoing communication. Leyva said he was under the impression that Langer was open to the idea of giving residents a chance to purchase the building themselves, but then the landlord withdrew from the agreement in September. 

Councilmember Shahana Hanif, who represents the district, sent him a letter not long after asking him to reconsider. “He must come back to the table, listen to the tenants’ demand on what it should look like for them to stay at 63 Tiffany Place,” she said at the rally. 

Residents are advocating for a particular local non-profit to make a preservation purchase. Tenants say that as long as they can’t be their own landlords, they want one that they can trust is committed to long-term affordability and stability.

Residents of 63 Tiffany Place now wait—but not passively. When Leyva isn’t taking care of his son, he’s usually making and hanging up flyers around the neighborhood or attending Zoom meetings with other housing advocates. 

On a recent Tuesday night, he was visited by a class of students from City College who were learning about tenant takeovers. Sitting around a wooden conference table in the backroom of the Carroll Gardens Association, the young students munched on pizza while Leyva answered questions. He recalled how, when he was 20, he worked in the women’s shoe department at Bloomingdale’s while renting an apartment in Washington Heights, and owned a car.

“I was able to do that on minimum wage,” he said. “I don’t know how we got to this point,” he added, telling the students that he was more concerned for their generation’s struggles, from student loans to soaring housing costs.

He continues to organize, and dozens of his neighbors are there with him. They inform each other on the latest legal updates about the building and stand at rallies holding signs. “We should be able to age in place with dignity and in the community that we’ve helped build,” Leyva said.

To reach the editor, contact Jeanmarie@citylimits.org

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