Social Housing in the Spotlight: NYC Lawmakers Seek ‘Paradigm Shift’ in Tackling Affordability Crisis

Councilmembers are weighing a slate of bills to expand programs and resources that follow the model of social housing—deeply affordable homes built “for public good” rather than profit, what supporters say could help turn the tide in a city where increasing numbers of tenants are struggling to afford rent. But City Hall officials pushed back on some of the proposals, saying they could undermine Mayor Adams’ efforts to build new housing as quickly as possible.

This month, the New York City Council and City Hall are holding hearings to negotiate the city’s next budget—including how to help fund Mayor Eric Adams’ proposed “moonshot” goal of building 500,000 new homes across the five boroughs over the next decade.

The mayor’s plan comes as New York leaders seek to ramp up development in the face of a housing shortage and affordability crisis: rents have hit historic highs in recent months, the homeless population has spiked and the number of apartments available for low-income tenants last year hit a decades-long low. Like Adams, Gov. Kathy Hochul has made housing production a priority in 2023, with a plan that will require localities to meet certain development benchmarks.

The city’s progressive lawmakers say they welcome the focus on new housing, but that the discussions so far have been “devoid of mention for whom the housing will be built,” said Bronx Councilmember Pierina Sanchez, who chairs the Council’s committee on housing and buildings.

The solution, she said, might be found in the “social housing” model: a loosely-defined but increasingly popular term used to describe policies and programs that center housing as a public good, with an emphasis on deeply affordable rents and opportunities for community ownership. The Council is considering a slate of bills that espouse this philosophy.

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“We need a paradigm shift—a discussion of housing that does not leave out the vast majority of New Yorkers who feel the most pain,” Sanchez said at an oversight hearing on the bills late last month, pointing to historical inequities like redlining that long cut communities of color off from home ownership and the building of generational wealth. “We’re never going to address the issues if we don’t talk about who is hurting the most.”

Administration officials who testified at the hearing, while saying they agreed with supporters’ goals, pushed back against some of the proposals, saying they could create additional layers of bureaucracy that might undermine Mayor Adams’ efforts to build new housing as quickly as possible.

City Council Speaker Adrienne Adams, who has the power to bring legislation that passes in committee up for a vote before the full City Council, is a co-sponsor on one of the bills, Councilmember Carlina Rivera’s Community Opportunity to Purchase Act (COPA), which would give “qualified entities” like nonprofits and Community Land Trusts the first chance to buy certain residential buildings that come up for sale.

The speaker has yet to take a position on the other legislation in the package, but called for “exploring expanded use of community land trusts and other social housing tools,” in the agenda that accompanied her State of the City speech Wednesday, where she cited programs like Mitchell-Lama as a model. She focused on the need for more affordable development and property ownership options, especially for Black New Yorkers who’ve been increasingly priced out of the city.

“Homeownership used to be a part of our story. But these days, it feels closer to a pipe dream,” Adams said.

‘Don’t be afraid’

While lawmakers are making a concerted push this year for social housing, many of the bills under consideration have been floated in prior legislative sessions. “I know the name scares people,” said Jumaane Williams, the city’s public advocate. “Don’t be afraid.”

New York City is already home to several types of social housing, though that footprint has shrunk over the years. Examples include public housing at NYCHA, nonprofit rentals or supportive housing—affordable units paired with services like mental health counseling, though demand for such apartments greatly outstrips supply.

The city’s Department of Housing, Preservation and Development (HPD) said it has, to date, financed 1,200 apartments on Community Land Trusts (CLTs), in which a nonprofit trust retains ownership of the land on which a property is located, allowing the homes themselves to be owned or leased more affordably by residents, who usually also play a role in running the trust.

The five boroughs are home to approximately 25,000 limited equity co-ops, according to HPD, where residents are shareholders in the cooperative that owns the building and where profits from unit sales are limited to keep them affordable. Another 60,000 Mitchell-Lama apartments remain in the city across 85 developments, though tens of thousands of affordable Mitchell-Lama homes have been converted to private-market units over the years.

“In the Koch and Dinkins Administrations, the city invested strongly in social housing,” City Comptroller Brad Lander testified to the Council last month. In in those days, he said, the city’s affordable housing land and subsidies were roughly evenly split between for-profit, nonprofit and tenant-owned housing models. For-profit development accounts for about 80 percent of those resources now, he said.

The legislation would look to reverse that trend. Rivera’s COPA bill, for example, would give approved nonprofits an early shot at bidding on residential properties that come up for sale. Another sponsored by Brooklyn Councilmember Lincoln Restler would similarly favor nonprofit developers, giving them first dibs at building on city-owned land (as of November, HPD had 810 vacant tax lots within its jurisdiction, officials said, about two-thirds of which were in the early process of development planning).

“Often, these nonprofit entities have the capacity to finance purchases of residential properties intended for affordable or supportive housing, but their bids are passed over in favor of for-profit developers who have more access to capital and can finance more quickly,” Rivera explained in Council testimony.

Councilmember Gale Brewer is reviving calls for the city to establish a land bank, an entity that would be in charge of acquiring and converting public land—including properties that fall into foreclosure—to “best serve the interests of the community.”

Another bill, by Brooklyn Councilmember Sandy Nurse, asks the city to study the possibility of creating an agency specifically focused on “how we can finance and develop more social housing.” A similar measure was recently approved by voters in Seattle.

“Social housing is a buzzword for good reason, with citywide coalitions winning unprecedented funding to expand their social housing models despite a decades-long strategy to underfund and discredit social housing as a viable, scalable alternative to the status quo,” Nurse wrote in an oped for City Limits announcing her legislation last month. “We cannot wait any longer.”

Nimble, or not?

Timing, however, is the issue for many of the bills’ opponents. The New York State Association for Affordable Housing, for instance, took aim at Rivera’s COPA bill—which would give nonprofits a 120-day window to bid on residential properties before they hit the wider market—by saying it would add “time and uncertainty” to those sales and “directly impede affordable housing preservation” by delaying new owners from acquiring distressed buildings.

Others in the development industry raised similar concerns about Restler’s public land bill, saying it would unfairly favor nonprofit builders over others, including Minority and Women-owned Businesses which the city has been trying to boost opportunities for.

“At a time when New York City continues to face a severe shortage of affordable housing, the focus should be on expanding the pool of qualified, committed affordable housing developers regardless of IRS tax status,” Alexandra Hanson, of the affordable housing firm Kreder Hanson Enterprises LLC, said in written testimony.

HPD Deputy Commissioner Kim Darga said Brewer’s land bank bill “would instead add time, complexity and significant cost to the existing process” and duplicate some of the services already provided by initiatives like the New York City Acquisition Fund, which helps developers build affordable housing. Nurse’s bill to study the creation of a new social housing agency would be similarly redundant, siloing the work HPD already does, said Lucy Joffe, the agency’s assistant commissioner for housing policy.

“These principles that we’re talking about today are really important to be housed within one agency and separating them won’t make it easier for us to do all that. It actually will get in the way of it,” Joffe said. “Having a separate agency doesn’t necessarily make us more nimble.”

Lawmakers and housing advocates who support the bills, however, countered that the existing approach isn’t working. The city is behind on its affordable housing production—which dropped 45 percent during the most recent fiscal year compared to the year before, Crain’s reported—and a third of New York tenants spend at least half their income on rent. More than 70,000 people sleep each night in the city’s homeless shelters.

“I do not believe that the market will ever solve for the people who are struggling hardest to get by,” Restler said. “We need to prioritize it.”