Joint Legislative Public Hearing on 2017-2018 Executive Budget Proposal: Topic "Housing" - Testimonies

February 17, 2017

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Hearing Event Notice;​

Archived Video:



 2  ------------------------------------------------------


 4             In the Matter of the
            2017-2018 EXECUTIVE BUDGET
 5                  ON HOUSING
 6  ------------------------------------------------------

 7                           Hearing Room B                                                    
                             Legislative Office Building
 8                           Albany, New York
 9                           February 17, 2017
                             9:41 a.m.  


12          Senator Catharine M. Young 
            Chair, Senate Finance Committee
            Assemblyman Herman D. Farrell, Jr.
14          Chair, Assembly Ways & Means Committee

16          Senator Liz Krueger 
            Senate Finance Committee (RM)
            Assemblyman Robert C. Oaks
18          Assembly Ways & Means Committee (RM)
19          Assemblyman Steven Cymbrowitz
            Chair, Assembly Housing Committee
            Senator Diane J. Savino
21          Vice Chair, Senate Finance Committee
22          Assemblyman Walter T. Mosley
23          Assemblyman Brian P. Kavanagh
24          Senator Jamaal Bailey


 1  2017-2018 Executive Budget
 2  2-17-17
 3  PRESENT:  (Continued)
 4           Assemblyman Andrew P. Raia
 5           Assemblywoman Yuh-Line Niou
 6           Senator James N. Tedisco
 7           Assemblywoman Carmen De La Rosa
 8           Senator Velmanette Montgomery
 9           Assemblyman Charles Barron















 1  2017-2018 Executive Budget
 2  2-17-17
 3  PRESENT:  (Continued)
 4           Assemblyman Joseph S. Saladino
 5           Senator Velmanette Montgomery
 8                   LIST OF SPEAKERS
 9                                    STATEMENT   QUESTIONS
10  James S. Rubin
    Commissioner and CEO
11  RuthAnne Visnauskas
    Executive Deputy Commissioner
12  New York State Homes and 
     Community Renewal                     8          17
    Duncan Barrett 
14  Executive Board Member 
    NYS Association for
15   Affordable Housing                  184
16  Paula Gilbert
    Executive Director 
17  Cara Long Corra
    Outreach Manager
18  Neighborhood Preservation
     Coalition of NYS                    191         198
    Laura Mascuch
20  Executive Director
    Supportive Housing Network
21   of New York                         207         211
22  Judi Kende
    Vice President & New York
23   Market Leader
    Enterprise Community 
24   Partners                            221         226


 1  2017-2018 Executive Budget
 2  2-17-17
 3                   LIST OF SPEAKERS, Cont.  
 4                                    STATEMENT   QUESTIONS
 5  Judy Eisgruber
 6  New York State Rural Advocates
 7  Colin McKnight
    Acting Executive Director
 8  New York State Rural 
     Housing Coalition                   227
    Rachel Fee
10  Executive Director
    New York Housing Conference          237       243
    Christie Peale
12  Executive Director
    Center for NYC Neighborhoods         245       255
    Edward Ubiera
14  Director of Policy
    Local Initiatives Support
15   Corporation-NYC                     258       263
16  John Broderick
    Senior Analyst
17  LeadingAge New York                  266
18  Hilary Lamishaw
19  NeighborWorks Alliance
     of New York State                   274       282
    Benjamin Dulchin
21  Executive Director
    Association for Neighborhood
22   & Housing Development               284       290
23  Stuart Kaplan
24  Selfhelp Community Services          292       300


 1  2017-2018 Executive Budget
 2  2-17-17
 3                   LIST OF SPEAKERS, Cont.  
 4                                    STATEMENT   QUESTIONS
 5  Jacquelyn Kilmer
 6  Harlem United Community
     AIDS Center                         304
    Charles King
 8  President and CEO
    Housing Works                        309         314
    Lisa A. Frisch
10  Executive Director
    The Legal Project                    318
    Lara Kasper-Buckareff
12  Director of Foreclosure
13  Legal Services of the 
     Hudson Valley                       327
    Tanisha Bramwell
15  Attorney
    Jordan Zeranti
16  Attorney
    Western New York 
17   Law Center                          332
18  Susan Cotner
    Executive Director
19  Affordable Housing 
20  Advocacy Cochair
    HomeSmartNY                          341
    Joseph Shuldiner
22  Executive Director
    The Municipal Housing
23   Authority for the 
     City of Yonkers                     344


 1                 CHAIRMAN FARRELL:  Good morning.  

 2                 Today we begin the final hearing 

 3          conducted by the joint fiscal committees of 

 4          the Legislature regarding the Governor's 

 5          proposed budget for fiscal year 2017-2018.  

 6          The hearings are conducted pursuant to 

 7          Article VII, Section 3 of the Constitution 

 8          and Article II, Sections 31 and 32A of the 

 9          Legislative Law.

10                 Today the Assembly Ways and Means 

11          Committee and the Senate Finance Committee 

12          will hear testimony concerning the budget's 

13          proposal for housing.  

14                 I will now introduce the members from 

15          the Assembly, and Senator Young, chair of the 

16          Senate Finance Committee, will introduce the 

17          members from the Senate.

18                 I have been joined by Chairman Steve 

19          Cymbrowitz and Assemblymember Mosley.  

20                 Mr. Oaks?  

21                 ASSEMBLYMAN OAKS:  Yes, we've also 

22          been joined by Assemblyman Raia.

23                 CHAIRMAN FARRELL:  Senator?  

24                 CHAIRWOMAN YOUNG:  Good morning.  I'm 


 1          delighted to be here.  Thank you, 

 2          Mr. Chairman.  I'm also delighted that today 

 3          is the last hearing that we will have for 

 4          this year on the budget.

 5                 (Laughter.)

 6                 CHAIRMAN FARRELL:  We will be dancing 

 7          later.

 8                 (Laughter.)

 9                 CHAIRWOMAN YOUNG:  Yes, we shall.  

10                 So I'd like to welcome everyone.  I'm 

11          Senator Catharine Young, and I'm chair of the 

12          Senate Standing Committee on Finance.  And 

13          I'm joined by my colleagues Senator Liz 

14          Krueger, who is ranking member on the Finance 

15          Committee; also Senator Jamaal Bailey, who is 

16          ranking member on the Housing Committee; and 

17          Senator Jim Tedisco.  And Senator Diane 

18          Savino, who's vice chair of the Finance 

19          Committee.

20                 CHAIRMAN FARRELL:  And before the 

21          first witness, I would like to remind all of 

22          the witnesses testifying today to keep your 

23          statements within your allotted time limit so 

24          that everyone can be afforded the opportunity 


 1          to speak.  

 2                 I will now ask and welcome New York 

 3          State Division of Homes and Community Renewal 

 4          Commissioner James Rubin and RuthAnne 

 5          Visnauskas -- did I get that?  Sorry.

 6                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 7          That's okay.

 8                 CHAIRMAN FARRELL:  I came close, I 

 9          think.  

10                 -- executive deputy commissioner.  

11          Good morning, and welcome.

12                 COMMISSIONER RUBIN:  Good morning, 

13          sir.  I apologize, we should have provided 

14          you and your colleagues with a pronunciation 

15          guide.  We've had --

16                 CHAIRWOMAN YOUNG:  What is it?  How do 

17          you say it?

18                 EX. DEP. COMMISSIONER VISNAUSKAS:  

19          Vis-naus-kiss.

20                 COMMISSIONER RUBIN:  Visnauskas.

21                 EX. DEP. COMMISSIONER VISNAUSKAS:  

22          It's a good Lithuanian last name.

23                 (Laughter.)

24                 COMMISSIONER RUBIN:  Yes.  You've had 


 1          it easy for two years, two syllables.

 2                 (Laughter.)

 3                 COMMISSIONER RUBIN:  Good morning, 

 4          Chairpersons Young and Farrell, Cymbrowitz, 

 5          Little and distinguished members of the 

 6          Legislature.  My name is Jamie Rubin and I am 

 7          commissioner and CEO of New York State Homes 

 8          and Community Renewal.  

 9                 I am joined this morning by RuthAnne 

10          Visnauskas, who is my executive deputy 

11          commissioner for housing development and my 

12          soon-to-be successor as the commissioner of 

13          HCR.  There was a formal announcement by 

14          press release this morning that RuthAnne is 

15          going to be succeeding me as I move over to 

16          the Governor's office to become the state 

17          director of operations, effective next week.  

18                 For those of you who have not had the 

19          opportunity to work with RuthAnne, I'd like 

20          to share a little bit of her background for 

21          your benefit.  Since joining my team, 

22          RuthAnne has been responsible for strategic 

23          leadership and oversight of all housing and 

24          finance programs for the agency.  


 1                 Prior to joining HCR, RuthAnne was 

 2          managing director of the Housing Advisory 

 3          Board for the Robin Hood Foundation, New York 

 4          City's largest poverty-fighting organization, 

 5          which spends over $100 million a year in New 

 6          York City on efforts including housing and 

 7          other poverty-fighting activities.  

 8                 She also held several key positions at 

 9          the New York City Department of Housing 

10          Preservation and Development, HPD, including 

11          the role of commissioner at the end of Mayor 

12          Bloomberg's administration.  

13                 RuthAnne is an experienced and 

14          outstanding public servant who shares the 

15          Governor's deep commitment, and yours, to 

16          expanding affordable housing opportunities 

17          and creating stronger communities across the 

18          state.  I am confident beyond words that I am 

19          leaving the agency in strong, capable hands, 

20          and I know that you will enjoy working with 

21          her, as I have over the last two years.  

22                 I'd like also to say that it has been 

23          an honor and a privilege for me in the last 

24          two years to serve as commissioner of HCR and 


 1          before that for two years as the director of 

 2          the Office of Storm Recovery, which is, as 

 3          you know, within HCR.  I absolutely leave the 

 4          agency in solid hands with RuthAnne -- better 

 5          than solid hands with RuthAnne, but that 

 6          would not be possible without the men and 

 7          women of HCR, some of whom are behind me and 

 8          others, obviously, are stretched throughout 

 9          the state.  They are the finest public 

10          servants and professional government workers 

11          that I've ever had the opportunity to work 

12          with or see, and we're all very fortunate to 

13          have them.

14                 With that, it is a pleasure to testify 

15          before you on the housing portion of Governor 

16          Andrew Cuomo's Executive Budget proposal for 

17          state fiscal year 2017-2018.  This is the 

18          second time that I've had the privilege to 

19          appear before you to present the Governor's 

20          housing budget.  

21                 I said it last year, and I'll say it 

22          again -- as I travel the state, I am 

23          constantly inspired by the work that we have 

24          done together to increase access not to just 


 1          housing but to high-quality, innovative, 

 2          mixed-use, green and sustainable homes 

 3          throughout New York.  

 4                 As you know, Governor Cuomo has a deep 

 5          commitment to housing, and I'm thrilled he 

 6          has once again made housing and community 

 7          renewal a priority -- because he knows, as 

 8          you and I do, that access to quality, 

 9          affordable homes makes life better, 

10          communities stronger, and opportunities 

11          greater for everyone.  

12                 As always, we are thankful for the 

13          Legislature's partnership as we've worked to 

14          address New York's housing needs, and I ask 

15          for your continued support building on this 

16          proposal.  

17                 Before I note a few highlights of the 

18          Executive Budget, I want to give you some 

19          examples of what we have achieved this past 

20          year on behalf of New York families with the 

21          resources you have helped us secure.  

22                 In 2016, New York State Homes and 

23          Community Renewal made significant progress 

24          increasing access to affordable housing and 


 1          securing the futures of families and 

 2          individuals across the state.  The agency set 

 3          a record again this past year, financing the 

 4          creation or preservation of more than 17,000 

 5          affordable homes and apartments.  And we were 

 6          the number-one housing bond issuer in the 

 7          nation, with $2.8 billion issued.  

 8                 Now, our Unified Funding housing round 

 9          awarded more than $122 million for affordable 

10          housing in urban, suburban, and rural areas 

11          of New York.  These awards will build or 

12          preserve nearly 2,000 affordable apartments 

13          and leverage more than $450 million in public 

14          and private resources.  

15                 We also continue to make great 

16          progress transforming New York's 8,600 aging 

17          Mitchell-Lama apartments in critical need of 

18          repairs and upgrades into quality, safe 

19          homes.  This year, we preserved another 

20          1,360 Mitchell-Lama apartments, bringing the 

21          total to 6,660 apartments in 26 locations and 

22          keeping this crucial stock of housing for 

23          middle-income New Yorkers affordable for 

24          another 40 years.  


 1                 And because good homes and strong 

 2          communities go hand in hand, HCR's New York 

 3          Main Street program awarded more than 

 4          $6 million in 2016 for the renovation of 

 5          77 residential units and 85 commercial spaces 

 6          in downtowns and mixed-use business districts 

 7          throughout the state.  These awards will 

 8          leverage more than $10 million in additional 

 9          investment and stimulate reinvestment in 

10          properties located within mixed-use 

11          commercial districts and adjacent 

12          neighborhoods, with a focus on sustainable 

13          downtown revitalization.  

14                 The agency has also put a major 

15          emphasis on fighting housing discrimination, 

16          with the 2016 launch of HCR's Fair Housing 

17          Enforcement Program to uncover discrimination 

18          in home rental and sale transactions and 

19          ensure compliance with all state, federal and 

20          local fair housing laws.  

21                 And most recently, we introduced the 

22          Affordable New York Housing Program, which 

23          expands the production of affordable housing 

24          and provides fair wages for the workers who 


 1          build selected buildings developed under this 

 2          program.  

 3                 This is just a sample of what we have 

 4          achieved in the past year.  And while I'm 

 5          extraordinarily proud of the work we've done, 

 6          there remains a very long road ahead.  The 

 7          successes we've had are due in large part to 

 8          programs and funding sources that were, by 

 9          their nature, time-limited or temporary.  We 

10          have been resourceful in our use of these 

11          funds, and it is critical to New York 

12          families that we maintain our record-breaking 

13          production numbers and provide our partners 

14          in the affordable housing community a 

15          multiyear capital funding plan to continue 

16          their work and to provide them with 

17          certainty.  

18                 That's why the Governor's Executive 

19          Budget continues funding support for his 

20          unprecedented $20 billion five-year 

21          Affordable and Homeless Housing Plan.  We 

22          have the potential with this budget -- and 

23          with your help -- to address our affordable 

24          housing crisis and do more for New Yorkers 


 1          facing housing insecurity and homelessness 

 2          than we ever have before.  

 3                 The plan will address New York's 

 4          affordable, supportive and homeless housing 

 5          crisis by building or preserving more than 

 6          100,000 housing units across the state over 

 7          five years.  The proposal includes a 

 8          $2 billion reappropriation of capital and 

 9          $526 million in new capital appropriations.  

10          The balance of the $20 billion consists of 

11          tax-exempt bonds, equity, and federal program 

12          dollars that leverage our capital subsidy.  

13                 The Housing Plan will leverage HCR's 

14          proven programs to do even more to address 

15          the diverse housing needs of the state and 

16          create new opportunities for low and 

17          moderate-income households.  It will include 

18          50,000 units of new construction and the 

19          preservation of 50,000 existing units 

20          desperately in need of rehabilitation, the 

21          majority of which will be targeted to low- 

22          and very-low-income households.  

23                 The need is there.  This plan is in 

24          place.  And I am confident that with your 


 1          support we can have a substantial impact on 

 2          meeting the housing demand in this state.  

 3                 In closing, the Executive Budget 

 4          housing proposal builds on the Governor's 

 5          commitment to moving New York families and 

 6          individuals forward.  It joins other bold 

 7          initiatives from prior times, like increasing 

 8          the minimum wage, to establish New York as a 

 9          national leader and provide struggling 

10          families and individuals with the stability 

11          that they need to succeed.  

12                 Your partnership has been instrumental 

13          in all that we've been able to achieve so 

14          far, and I am asking for your help again as 

15          we move forward on our path to assuring that 

16          all New Yorkers have access to decent, 

17          affordable homes and the opportunity to 

18          thrive.  

19                 Thank you.  RuthAnne and I are happy 

20          to address your questions.

21                 CHAIRMAN FARRELL:  Thank you very 

22          much.  

23                 First to question, Chairman 

24          Cymbrowitz.


 1                 ASSEMBLYMAN CYMBROWITZ:  Thank you, 

 2          Chairman.  Good morning, everyone.

 3                 COMMISSIONER RUBIN:  Good morning, 

 4          sir.

 5                 ASSEMBLYMAN CYMBROWITZ:  And thank you 

 6          to all of you for being here.  

 7                 To those of you who I've had the 

 8          pleasure of meeting during the last several 

 9          weeks as the new chair of the Housing 

10          Committee, it's nice to see you again.  For 

11          those of you who are testifying before us 

12          today that I haven't met before, I look 

13          forward to hearing your testimony today and 

14          working with you going forward.  

15                 We in the Legislature have the 

16          responsibility of making sure the budget is 

17          done in a way that reflects the needs of our 

18          constituents for safe, decent and affordable 

19          housing.  When people have stable housing, it 

20          not only has a positive impact on their 

21          lives, but on the economy and their 

22          community.  

23                 Today's hearing is an opportunity for 

24          us to get further clarification of the 


 1          Governor's budget.  As many of you know, and 

 2          as I'm sure some of you will testify, a good 

 3          spending plan is needed to address issues 

 4          relating to housing availability and 

 5          affordability.  We in the Assembly majority 

 6          have always been and remain ready to work 

 7          with our colleagues in government to meet 

 8          those housing needs.  I thank you in advance 

 9          for taking the time to speak with us today.  

10          I look forward to hearing your testimony and 

11          maintaining a dialogue with all of you 

12          throughout the budget process.

13                 Jamie, RuthAnne, thank you.  RuthAnne, 

14          first, congratulations and best of luck.

15                 EX. DEP. COMMISSIONER VISNAUSKAS:  

16          Thank you.

17                 ASSEMBLYMAN CYMBROWITZ:  Jamie, I 

18          guess we've got to say the same.  

19                 (Laughter.)

20                 ASSEMBLYMAN CYMBROWITZ:  But I think 

21          the most important question for me, just to 

22          begin with, is the fact that the Governor's 

23          budget funds -- it's a $20 billion, five-year 

24          Affordable and Homeless Housing Plan.  Can 


 1          you talk about why it's important to have a 

 2          five-year plan and what the thought process 

 3          was about that?  And when it comes to 

 4          supportive housing, you're talking about 

 5          6,000 units.  Is that something that actually 

 6          can be built in the five years, based on the 

 7          process that we have all gone through and 

 8          understood what it's like to build supportive 

 9          housing?

10                 COMMISSIONER RUBIN:  So thank you, 

11          Mr. Cymbrowitz, for your question.  What 

12          we're going to do, if possible, and I 

13          apologize if this is going to seem a little 

14          awkward at times, we're going to try to split 

15          the way we answer.  I think hopefully you'll 

16          get one view from two mouths.  

17                 Why don't I just address your question 

18          about the five years for a moment.  It's a 

19          terrific question and one that we've 

20          discussed with you and your colleagues as 

21          well as your staffs over the last year since 

22          the Governor made his proposal of the $20 

23          billion, five-year plan, public in the State 

24          of the State and the Executive Budget last 


 1          year.  And principally, the goal of 

 2          attempting to put in place a five-year 

 3          capital plan, which the state really has 

 4          never done before in the housing space, was 

 5          to mimic what we try to do in other areas of 

 6          similar infrastructure development, because 

 7          housing fundamentally is a piece of social 

 8          infrastructure.  

 9                 So for example, the MTA capital plan, 

10          the Port Authority capital plan, other areas 

11          of transportation always have multiyear 

12          capital plans.  And the reason for that is 

13          because -- is primarily one of certainty.  

14          It's critically important to the people of 

15          New York to understand that their needs, the 

16          needs of the critical infrastructure that 

17          they travel over every day, is going to be 

18          met for many years to come.  

19                 These are multiyear -- the projects 

20          that are put in place are multiyear projects.  

21          They don't get funded themselves one year at 

22          a time, they get funded for multiple years, 

23          and the same is true -- and so that the 

24          multiyear capital plan is appropriate.  


 1                 Similarly, in the area of housing, 

 2          although it's not the way that this has been 

 3          approached in the past, issues of certainty 

 4          and funding are multiple -- are 

 5          multiple-year.  So for example -- RuthAnne 

 6          knows this better than I do -- we at our 

 7          agency do everything that we do in 

 8          partnership with the housing development 

 9          community, nonprofit and for-profit.  They 

10          depend on us to provide a certain amount of 

11          funds, but they also put themselves at risk 

12          when they secure sites or invest ahead of -- 

13          ahead of owning particular sites, they invest 

14          in design and build planning for those sites.

15                 They need -- before they put their 

16          money out, particularly nonprofits -- you 

17          know, it's particularly true for nonprofit 

18          developers -- they need to understand that 

19          our support is going to be there when they do 

20          their work.  And they put themselves at risk, 

21          and I think it's appropriate for us, where 

22          possible, to tell them that the government is 

23          going to be there for many years at a time as 

24          well, rather than on a year-by-year basis.  


 1          It's how they do their work; it's how we 

 2          should do our work.  

 3                 So it's really a question of certainty 

 4          to the market, without which we wouldn't be 

 5          able to do our work.  

 6                 I don't know if RuthAnne wants to add 

 7          anything, and then maybe you could talk for a 

 8          second about the 6,000 units.

 9                 EX. DEP. COMMISSIONER VISNAUSKAS:  

10          Yes, I would echo what Jamie said.  And sort 

11          of specifically on the supportive housing 

12          pipeline, I think that rings true where I'm 

13          happy to say that we are on schedule and have 

14          awarded funding for the first 1200 of the 

15          6,000 commitment statewide for -- of 

16          supportive housing.  

17                 And I think that the partners that we 

18          work with need to know that they can buy 

19          sites today and will have financing next year 

20          or the year after.  Right?  Many of those 

21          sites might have to be cleaned up, they might 

22          have to go through a public approval process 

23          that might take over a year.  And just the 

24          normal course of sort of development is a 


 1          year-or-two-year-prior-to-construction 

 2          process.  

 3                 So we want people to be able to buy 

 4          sites, nonprofits and for-profits, and be 

 5          able to bring them to us in a year or two 

 6          years and know that we'll have the funding 

 7          available to finance them.

 8                 ASSEMBLYMAN CYMBROWITZ:  So you've 

 9          been able to fund the 1200, the thousand 

10          within the city and the 200 outside the city?

11                 EX. DEP. COMMISSIONER VISNAUSKAS:  The 

12          1200 is statewide, it was about that 

13          breakdown.  But we can provide you with sort 

14          of detail on those.

15                 ASSEMBLYMAN CYMBROWITZ:  What is the 

16          average number of supportive housing units 

17          that are built statewide?

18                 EX. DEP. COMMISSIONER VISNAUSKAS:  

19          Including the city's production on -- 

20                 ASSEMBLYMAN CYMBROWITZ:  Yes.

21                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

22          don't know the city's production numbers as 

23          well anymore.  Our production has been about 

24          800 units in the past couple of years.  We 


 1          have a fairly robust supportive housing 

 2          pipeline and are sort of building on that.

 3                 The city, when I was there, 

 4          traditionally was doing between 500 and a 

 5          thousand units as well.  And in recent years 

 6          they have increased that goal, so I think 

 7          their production has also been ramped up.  

 8                 ASSEMBLYMAN CYMBROWITZ:  So you'll be 

 9          funding the city's units as well?  So the 

10          6,000 includes the city's production?  

11                 EX. DEP. COMMISSIONER VISNAUSKAS:  The 

12          6,000 is just HCR's commitment.  We certainly 

13          do projects in conjunction with the city.  

14          But we have many projects in our pipeline 

15          that are independent of any other city 

16          funding.  

17                 I mean, as you would expect, 

18          projects that we finance in the city have a 

19          city tax exemption.  So we certainly work 

20          with them, on if not the financing in terms 

21          of capital, certainly on sort of the tax 

22          exemption front, on any affordable housing 

23          project that we do.

24                 ASSEMBLYMAN CYMBROWITZ:  The Executive 


 1          Budget includes $100 million for NYCHA, for 

 2          their capital needs.  Based on what we're 

 3          hearing, what we're all hearing from 

 4          Washington, with the severe cuts that are 

 5          projected for public housing, not only NYCHA 

 6          but statewide, are there contingency plans by 

 7          the Executive to cover those costs?  And just 

 8          to begin, is the $100 million enough?  For 

 9          the 17 billion -- obviously, a $17 billion 

10          backlog in NYCHA alone, certainly the 

11          $100 million is not sufficient.

12                 COMMISSIONER RUBIN:  On the question 

13          of the impact of possible federal budget cuts 

14          specifically on NYCHA, obviously the new 

15          administration is only just in place.  The 

16          new HUD secretary, who I've not met, is 

17          himself only just in place.  I have no idea 

18          what the status of his team is.  There's not 

19          been a new budget.  I think Congress is still 

20          operating under a continuing resolution 

21          through April.  

22                 So obviously we, in housing as in all 

23          other areas, are eagerly awaiting the budget 

24          proposal that comes out, you know, whenever 


 1          Congress puts forward -- the president puts 

 2          forward really his first budget.  So it's 

 3          really impossible right now, obviously, to 

 4          speculate on what they may have in store for 

 5          public housing subsidies or any other area of 

 6          our budget.

 7                 The Governor, I would say -- in his 

 8          budget this year, as you know, the Governor 

 9          has a broader -- has reserved broader 

10          flexibility across the entire budget to 

11          account for any possible federal budget 

12          reductions, which I think is appropriate, and 

13          that will extend to our piece of the 

14          Executive Budget.  But until we see the 

15          specifics, obviously, it's impossible to make 

16          more comments.

17                 You know, obviously NYCHA -- to your 

18          second question, NYCHA is largely federally 

19          funded, as you know, federal and rent.  And 

20          is a -- you know, NYCHA is, as you know 

21          better than most, a critical source in the 

22          city -- really, the principal source -- of 

23          safe and secure housing for people of low and 

24          moderate incomes.  


 1                 So federal funding for NYCHA, 

 2          obviously we would strenuously push against 

 3          any attempts to reduce the subsidies further 

 4          than where they are today.  It's been coming 

 5          down, obviously, year over year already, 

 6          Republican and Democrat administrations.

 7                 But your question is whether our 

 8          existing $100 million proposal for NYCHA for 

 9          the next fives years is -- I think you said 

10          is it adequate.  You correctly stated that 

11          NYCHA has a very well publicized, very large 

12          maintenance backlog.  And as you know, the 

13          Governor has in the past couple of budgets 

14          attempted to -- has made state contributions 

15          to NYCHA's budget:  $100 million from the 

16          JPMorgan settlement money a couple of years 

17          ago, another $100 million in this five-year 

18          capital plan.  

19                 And I'm also happy to say that at the 

20          end of last year -- and I'll ask RuthAnne to 

21          talk about this -- we executed a very large 

22          $400 million financing for one specific, very 

23          large NYCHA project in Queens.  

24                 So I believe in the context of a 


 1          budget that isn't, obviously, infinite in 

 2          size, in the context of an affordable housing 

 3          crisis statewide, that we have to try to meet 

 4          with the many, many different tools at our 

 5          disposal the commitments that the Governor's 

 6          budget has made to -- that the Governor has 

 7          made in his budget in the last couple of 

 8          years to NYCHA has been substantial.

 9                 Why don't I turn it over to RuthAnne.

10                 EX. DEP. COMMISSIONER VISNAUSKAS:  

11          Yeah, I would just add that we work and 

12          support -- we have a very good, strong 

13          working relationship with NYCHA and we work 

14          with them in multiple ways, so not just on 

15          capital.  But as Jamie said, but in December 

16          we refinanced for them a 1400-unit complex 

17          called Ocean Bay out in the Rockaways that 

18          took advantage of HUD's RAD program.  And 

19          NYCHA itself is very focused on transitioning 

20          a number of their complexes into RAD as a way 

21          to handle federal cuts, which have been going 

22          on for, you know, 20 years.  And they have 

23          been looking at ways to sort of shift 

24          themselves to be able to manage their 


 1          properties long-term in the face of a smaller 

 2          federal budget.

 3                 So we provided about $213 million of 

 4          volume cap to that transaction in December, 

 5          which allowed NYCHA, as Jamie said, to put 

 6          $400 million -- which well exceeds any one 

 7          annual capital budget that they would have 

 8          for themselves to put into a complex like 

 9          that.  And they're able to do a sort of 

10          soup-to-nuts not only a rehab of the entire 

11          complex but also a large amount of resiliency 

12          measures, since it is sort of surrounded by 

13          water on both sides out there in the 

14          Rockaways.  

15                 So I just think there's other ways 

16          that we can be very supportive of NYCHA in 

17          addition to capital resources through volume 

18          cap.

19                 CHAIRMAN FARRELL:  Senator.

20                 CHAIRWOMAN YOUNG:  Thank you.  

21                 And again, welcome.  And first of all, 

22          I'd like to give both of you sincere 

23          congratulations and gratitude for everything 

24          that you do for housing.  


 1                 And Commissioner Rubin, not long to be 

 2          commissioner, but you certainly have made an 

 3          impact all across the state, because we know 

 4          how vital affordable quality housing is to 

 5          everyone's quality of life.  And thank you 

 6          for coming out to the 57th Senate District 

 7          and your commitment to rural housing.  I 

 8          mean, we know that housing is a critical 

 9          issue all across the state, and thank you for 

10          coming out and experiencing rural housing 

11          firsthand, seeing the faces of rural poverty, 

12          isolated communities, the oldest housing 

13          stock in the entire state and actually the 

14          entire country in my district.  So thank you 

15          for doing that.

16                 And also congratulations to soon-to-be 

17          Commissioner Visnauk -- Visnaukas -- 

18          Visnauskas.  Did I get that right?

19                 EX. DEP. COMMISSIONER VISNAUSKAS:  

20          That's good.

21                 CHAIRWOMAN YOUNG:  Okay.  I'll get it 

22          down.

23                 But I know that you've -- you also are 

24          interested in statewide housing issues, and 


 1          thank you for already committing today to 

 2          come out to my district.  And I look forward 

 3          to hosting you.  And I think it will be a 

 4          very valuable experience for you and for me 

 5          also.

 6                 So -- however, with that being said, I 

 7          just wanted to ask about some of the staffing 

 8          at the agency.  Now that Commissioner Rubin 

 9          is going to even higher climates, how will 

10          the agency be set up?  Are there going to be 

11          any other administrative changes other than 

12          you becoming commissioner?

13                 COMMISSIONER RUBIN:  You know, 

14          obviously, thank you, Senator Young.  By the 

15          way, thank you for your kind words.  It's 

16          been a pleasure working with you.  I'm sorry 

17          that Senator Little wasn't here, but 

18          obviously I'll talk to her separately.  But 

19          it's been a great pleasure working with you 

20          and your colleagues in the last two years.

21                 There aren't, that I can think of 

22          offhand, any other major administrative 

23          changes.  Obviously, every agency the size of 

24          ours goes through a regular process of, you 


 1          know, retirements and just a general churning 

 2          of people.  And we always try to attract the 

 3          best and brightest people to staff the agency 

 4          at all levels.  I think we've made great 

 5          strides there over the last two years since 

 6          I've been there.  

 7                 But there aren't any major 

 8          administrative changes other than what we 

 9          have in front of us today, with one 

10          exception, I guess, which is simply -- which 

11          is really just a recognition of what was 

12          already in place, which was that Linda 

13          Manley, who is my general counsel, has been 

14          acting general counsel for about six months, 

15          and we named her today as the permanent 

16          general counsel.  Which is great for the 

17          agency and for the people of New York.

18                 CHAIRWOMAN YOUNG:  Great.  

19                 Now, you're gearing up for major 

20          multiyear capital investments, and I wanted 

21          to ask about the staffing ratios.  Because in 

22          2011-2012, HCR reported 757 FTEs.  In the 

23          2018 proposed budget, the agency anticipates 

24          682 FTEs, which is a reduction of 77 staff 


 1          over time.  During this same period, the 

 2          Office of Rent Administration has increased 

 3          by six positions, which means that the rest 

 4          of the agency has really lost 81 staff.  

 5                 So were any of these positions 

 6          transferred to HFA or SONYMA or payrolls, or 

 7          how is that working?  And I guess the 

 8          follow-up question to that would be if you're 

 9          gearing up for these major huge projects, 

10          will you have the staffing to be able to 

11          handle it?  

12                 COMMISSIONER RUBIN:  Let me say -- 

13          I'll say a couple of things, and then perhaps 

14          RuthAnne can talk a little bit about her 

15          perspective on staffing.

16                 It's a great question and I appreciate 

17          it, because it shows that you recognize that 

18          the work is really done obviously by the 

19          people of the agency.

20                 I don't know -- those numbers -- I'd 

21          have to look at the numbers specifically and 

22          figure out why we wanted those changes.  As 

23          you know, HCR as it stands today is the 

24          product of a merger back in 2011 between the 


 1          old DHCR and the HFA-SONYMA complex.  And 

 2          those numbers are low, so I suspect that 

 3          there's -- some of that is not getting 

 4          captured in those numbers.  

 5                 But, you know, as part of the merger, 

 6          which started before I got there and which 

 7          we've continued to execute since I arrived, 

 8          as you would expect -- and it was, I assume, 

 9          part of the justification of the merger -- 

10          there were some redundant activities.  

11          They're two agencies that were doing similar 

12          things in different areas with different 

13          programs, but there definitely was overlap, 

14          which popped up as soon as you put the two 

15          agencies under one umbrella.  And I suspect 

16          that that -- some of that reduction may be 

17          the product of a successful merger and a 

18          well-thought-out merger.  

19                 In other places, you know, we may not 

20          be operating entirely to fill.  

21                 But I would also say that there have 

22          been a number of managerial initiatives, even 

23          some predating me, that the agency, like many 

24          of our sister state agencies, have adopted at 


 1          the urging of the Governor under things like 

 2          the Lean program and other management 

 3          initiatives that have enabled the agency and 

 4          our people to work better and smarter.  And 

 5          the work product that comes out -- as I 

 6          mentioned, just on the production side, we've 

 7          had three consecutive record years.  In other 

 8          areas we're just similarly doing, I think, 

 9          better than we ever have before.  You 

10          mentioned ORA.  Our ORA backlog is way down.  

11          Other -- you know, I can go on.

12                 I think it's evidence that the agency, 

13          far from missing a beat, is operating exactly 

14          at peak level.  FTE numbers aside, the 

15          activity is very, very high and very 

16          effective.  And again, I think that's just a 

17          testament to the quality -- the importance of 

18          the merger and the quality of the people that 

19          we've got, their ability to adapt to changing 

20          circumstances.

21                 EX. DEP. COMMISSIONER VISNAUSKAS:  

22          Yeah, I would add that when we contemplated 

23          the additional funding in the budget for 

24          housing, we thought about how many more 


 1          transactions that would be across the agency 

 2          and made sure that we felt like we had the 

 3          right organizational structure and staff in 

 4          place.

 5                 So we feel that we stand ready to take 

 6          that on across underwriting, across our 

 7          lawyers, across our asset management staff.  

 8          You know, we were sort of thoughtful about 

 9          it, and we feel we're ready for the task.

10                 CHAIRWOMAN YOUNG:  That's good to 

11          hear.  That's good.

12                 Just switching to the Governor's 

13          affordable housing plan, in June the Governor 

14          and the Legislature signed two MOUs totaling 

15          $150 million.  So could you give more details 

16          on the results of releasing those funds, such 

17          as the projects, locations, and units that 

18          they helped create?  Could we get more detail 

19          on that?  

20                 EX. DEP. COMMISSIONER VISNAUSKAS:  

21          Yes, we'd be absolutely happy to provide the 

22          list.  We have committed the majority of that 

23          150 to date and have more projects that will 

24          close at the end of the fiscal year, and we'd 


 1          be happy to show you the list and all the 

 2          locations of the projects.

 3                 CHAIRWOMAN YOUNG:  Okay, that would be 

 4          helpful.  I'm also interested in regional 

 5          balance and that sort of thing, so that would 

 6          be great to see the list.

 7                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 8          Absolutely.

 9                 COMMISSIONER RUBIN:  Certainly.

10                 CHAIRWOMAN YOUNG:  Can you explain the 

11          Governor's current budget proposal for 

12          affordable housing, again in a little bit 

13          more detail?  We've kind of gone over it with 

14          a broad brush, but it would be great, before 

15          we vote on the actual budget later on, to 

16          have some of those details.

17                 COMMISSIONER RUBIN:  Of course.  

18                 Do you want to talk about --

19                 EX. DEP. COMMISSIONER VISNAUSKAS:  

20          Want me to take a stab?

21                 COMMISSIONER RUBIN:  Yeah, why don't 

22          you go ahead and do that.

23                 EX. DEP. COMMISSIONER VISNAUSKAS:  So 

24          we are very focused on the budget and the 


 1          housing that will be funded by the funds that 

 2          are in the budget.  Although we also do a lot 

 3          of things outside the budget too, so of 

 4          course when we think about the work that the 

 5          agency does, we think about it very 

 6          holistically.  And it's sort of divided, I 

 7          would say, into a couple of different 

 8          categories in terms of simplifying it into 

 9          something that's sort of easy to talk about.  

10                 We have a very robust new construction 

11          pipeline, so we are doing adaptive reuse, 

12          which we sort of think of as new construction 

13          because it tends to be extensive.  So we have 

14          a very robust adaptive reuse and new 

15          construction pipeline upstate.  We have a 

16          very robust supportive housing production.  

17          Switching to preservation, we will do a lot 

18          of -- I'll have a lot of emphasis on making 

19          sure public housing is preserved across the 

20          state, making sure our Mitchell-Lama 

21          portfolio, both the UDC portfolio that we 

22          inherited as well as the other Mitchell-Lamas 

23          that are across the state, have access to 

24          dollars for preservation.  We're very focused 


 1          on middle income.  We have an enormous amount 

 2          of appetite across the state for people doing 

 3          mixed-income projects that want to take 

 4          advantage of middle-income dollars as well as 

 5          the CIF, the Urban and Rural Community 

 6          Investment Fund.  

 7                 We also, in terms of neighborhood 

 8          revitalization, think about our Main Street 

 9          program, which has been very important to 

10          upstate communities, and we often have a lot 

11          of -- we're very well subscribed in that 

12          program.  Recently last year we launched, on 

13          sort of the homeownership front, a new pilot 

14          for manufactured and mobile homes to be fully 

15          replaced in upstate communities.  And we've 

16          had a very strong response to that.  

17                 In addition to the mobile homes, on 

18          the homeownership we obviously have SONYMA, 

19          where we provide access to first-time 

20          homeownership for -- I think this year we did 

21          almost 2,000 new homeowners in the state.  

22          The DHC program I think was about 1500 units 

23          last year of new homeownership.  So we think 

24          about it as new construction, as 


 1          preservation, as community development -- 

 2          homeownership -- in addition to a lot of 

 3          other work that the agency does sort of 

 4          maintaining the existing stock around the 

 5          state.

 6                 CHAIRWOMAN YOUNG:  Thank you.  When 

 7          you get more information, it would be helpful 

 8          to have -- you talk about the pipeline, and 

 9          I've heard you talk about the pipeline in the 

10          past.  So it would very helpful to know which 

11          projects are in the pipeline also, if we can 

12          get that information.

13                 EX. DEP. COMMISSIONER VISNAUSKAS:  

14          Certainly.

15                 CHAIRWOMAN YOUNG:  Do you want me to 

16          come back, Mr. Chair?  Because I have several 

17          other questions.  Or do you -- 

18                 CHAIRMAN FARRELL:  Yes.

19                 CHAIRWOMAN YOUNG:  -- want me to keep 

20          going?  Okay, I'll come back.

21                 CHAIRMAN FARRELL:  Thank you.

22                 CHAIRWOMAN YOUNG:  Thank you.

23                 CHAIRMAN FARRELL:  Mr. Mosley.

24                 ASSEMBLYMAN MOSLEY:  Thank you, 


 1          Mr. Chairman.  To Chairman Farrell, 

 2          Chairwoman Young, thank you for your yeoman 

 3          efforts, to your staffs as well.  Thank you 

 4          for informing me -- I was on my way back up 

 5          to Albany when you guys informed me that the 

 6          hearing was going to be delayed till today, 

 7          so thank you for allowing me to preserve my 

 8          body and avoid another trip up to Albany.

 9                 (Laughter.)

10                 ASSEMBLYMAN MOSLEY:  To our 

11          commissioner, congratulations to you on your 

12          elevation --

13                 COMMISSIONER RUBIN:  Thank you, sir.

14                 ASSEMBLYMAN MOSLEY:  To our soon-to-be 

15          commissioner, congratulations to you.

16                 EX. DEP. COMMISSIONER VISNAUSKAS:  

17          Thank you.  

18                 I'm going to make efficient use of my 

19          time, so I'm just going to go right into the 

20          questions.  

21                 My colleague, Chairman Cymbrowitz,

22          talked about the NYCHA capital needs.  And I 

23          remember in 2015 the Executive allocated 

24          $100 million to New York City.  And there 


 1          were some issues in terms of how that money 

 2          was going to be used, how it was going to be 

 3          allocated, how it was going to actually drill 

 4          down to the actual developments.  And it 

 5          still exists today.  So I just want to find 

 6          out, what have you done to kind of eliminate 

 7          some of those barriers and those 

 8          discrepancies that, you know, find us in this 

 9          current situation now where we still are 

10          trying to get that money to our actual sites 

11          in our districts?

12                 COMMISSIONER RUBIN:  Sure.  Thank you, 

13          Mr. Mosley.  

14                 I -- HCR -- so the $100 million that 

15          was committed to NYCHA from the settlement 

16          money a couple of years ago was a sort of -- 

17          the construct that was put in place to invest 

18          that money in NYCHA projects included our 

19          agency, HCR, more on almost a consulting 

20          basis.  DASNY, the Dormitory Authority of the 

21          State of New York, obviously was really the 

22          executing agency, which is appropriate, 

23          because they're the ones that are most on 

24          point on any number of capital and design and 


 1          execution projects for the state.  And then, 

 2          of course, NYCHA.

 3                 You are correct that the process of 

 4          executing on the list of projects that was 

 5          developed, partly in partnership with the 

 6          Legislature, has taken probably longer than 

 7          it might otherwise have done.  I'm happy to 

 8          say that $50 million has been transferred 

 9          over to DASNY and onward to NYCHA.  As we sit 

10          here now, I don't know the exact numbers, but 

11          I think over $10 million has actually been 

12          invested, put to work, in a variety of 

13          critical security projects, which is what 

14          most of the first $50 million was designed to 

15          address, security projects -- you know, very 

16          specific security projects in -- across the 

17          NYCHA portfolio.

18                 There is a -- there is increased, 

19          thanks to you and others of your colleagues, 

20          as well as the Governor's office and us, 

21          there has been increased focus in the last 

22          little bit on making sure that that money is 

23          moving even faster.  And there's a process 

24          underway, I think in partnership with the -- 


 1          certainly, you know, critically between NYCHA 

 2          and DASNY, to make sure that it's moving 

 3          quickly.  So we're happy to talk further or 

 4          have our colleagues at DASNY talk to you 

 5          about that.

 6                 ASSEMBLYMAN MOSLEY:  All right, thank 

 7          you.

 8                 The 421-a proposal, I just have just a 

 9          list of questions.  And you can say -- if you 

10          don't have the information, you can say "I 

11          can give it to you," because something might 

12          be a little bit too detailed.  

13                 How many affordable units will be 

14          built at 40 percent AMI, 70 percent AMI, and 

15          130 percent AMI?  Do you have those numbers?

16                 COMMISSIONER RUBIN:  Under the entire 

17          421-a program?

18                 ASSEMBLYMAN MOSLEY:  Yeah.

19                 COMMISSIONER RUBIN:  Which I'm just 

20          going to keep calling it the Affordable 

21          New York Housing Program.

22                 (Laughter.)

23                 ASSEMBLYMAN MOSLEY:  Okay.

24                 COMMISSIONER RUBIN:  I think we'll 


 1          have to come back to you with details about 

 2          specific AMI -- you know, projections of unit 

 3          construction at specific AMI levels.  

 4          Although I would say that really that 

 5          New York City -- New York City is better 

 6          positioned, probably, to give you that 

 7          specific answer.

 8                 ASSEMBLYMAN MOSLEY:  On the 

 9          Affordable -- whatever you want to call it --

10                 (Laughter.)

11                 ASSEMBLYMAN MOSLEY:  What percentage 

12          of the -- 421-a.  But I know you want to call 

13          it something else.  What percentage of the 

14          registered rent-stabilized units will be 

15          preferential rent units.

16                 COMMISSIONER RUBIN:  What percentage 

17          will be preferential rent?

18                 ASSEMBLYMAN MOSLEY:  Yeah.

19                 COMMISSIONER RUBIN:  I wouldn't be 

20          able to predict.  I wouldn't expect much, 

21          frankly.  I mean, our experience with 

22          preferential rent is that you typically find 

23          preferential rents in weaker markets -- you 

24          know, weaker rent markets.  And 421-a 


 1          buildings, I think -- RuthAnne hopefully will 

 2          agree with us -- are generally found, you 

 3          know, in less-than-weak markets, although 

 4          that may be changing with the new structure 

 5          of the -- you know, the three-option 

 6          structure.  

 7                 But I think typically -- I'd be 

 8          surprised if there were preferential rents in 

 9          place in 421-a buildings.

10                 ASSEMBLYMAN MOSLEY:  What percentage 

11          of -- I know that the Governor takes a lot of 

12          power away from City Council and from the 

13          city in terms of compliance and oversight.  I 

14          know we talked about this in my office, and I 

15          know you said you were going to get back to 

16          me.  

17                 Can you give me a little more detail 

18          in terms of compliance and oversight over 

19          this project?  Because we know it's a 

20          statewide initiative, but at the same time we 

21          know that the local governments are going to 

22          be the ones who are going to be hands-on in 

23          terms of compliance and oversight.  

24                 So can you explain to me what you've 


 1          gotten back since our last conversation?

 2                 COMMISSIONER RUBIN:  Of course.  And 

 3          you and I have had the opportunity to talk 

 4          about this in some detail.  

 5                 I share your concern about compliance 

 6          and oversight.  Obviously any time there's a 

 7          substantial benefit being given to any party, 

 8          it has to come with a well-thought-out and 

 9          rigorous compliance and oversight regime 

10          attached to it.  And I think in this case -- 

11          in this case we have one in place.

12                 I should say we don't really -- the 

13          good news is we don't really, with the 

14          Affordable New York Housing Program, need to 

15          make too much up because this is a tax 

16          benefit that's been in existence since the 

17          1970s.  It's -- you know, compliance and 

18          oversight with respect to this program is 

19          really is New York City's -- is entirely 

20          New York City's.  It's New York City's tax 

21          abatement and it's New York City's oversight 

22          responsibility.  

23                 And I know my colleagues at HPD -- 

24          which RuthAnne is in a far better position 


 1          than I am to speak about -- have a robust 

 2          mechanism for making sure that developers who 

 3          receive the tax abatement are complying with 

 4          their obligations.  

 5                 With respect specifically to the most 

 6          recent changes in the bill that's before you 

 7          now, the difference between the 2015 enacted 

 8          legislation and now, there is a -- as you 

 9          know, there is a modest additional tax 

10          benefit being provided to certain developers 

11          for certain very, very large buildings that 

12          are constructed in certain restricted 

13          geographic areas, in return for which they 

14          are providing fair wages according to a very 

15          specific wage scale.  And you know all about 

16          this.  

17                 So there is an additional compliance 

18          and oversight responsibility that's put on 

19          them, because there is this wage obligation.  

20          We fully expect, as is specifically called 

21          out in the law -- in the legislation, that 

22          the city's HPD is going to enact and 

23          promulgate rules and regulations around 

24          compliance and oversight.  They're very good 


 1          at it.  They are already, I'm sure, thinking 

 2          about what that will look like.  And that's 

 3          really where the rubber is going to meet the 

 4          road, and that will just add to their already 

 5          existing rules that are pretty well known.  

 6                 So I think this is -- I think this 

 7          is -- I share your concern, but I'm confident 

 8          that it will be handled effectively by HPD.

 9                 ASSEMBLYMAN MOSLEY:  Thank you, 

10          Commissioner.  

11                 CHAIRMAN FARRELL:  Thank you.

12                 Senator?  

13                 CHAIRWOMAN YOUNG:  Thank you.  

14                 Senator Liz Krueger.

15                 SENATOR KRUEGER:  Good morning to both 

16          of you, and congratulations.

17                 COMMISSIONER RUBIN:  Thank you.


19          Thank you.

20                 SENATOR KRUEGER:  Congratulations or 

21          condolences to both of you for your new 

22          positions.

23                 I'm probably going to have a series of 

24          five-minute questions, so we'll start with 


 1          the operation of the agency.

 2                 So in January of this year, Governor 

 3          Cuomo announced DHCR was initiating a major 

 4          initiative to return 50,000 illegally 

 5          deregulated apartments in buildings receiving 

 6          J-51 benefits back to rent regulation.  That 

 7          was seven years after a lawsuit saying these 

 8          units were in violation of the law.  Many of 

 9          us urged you to send letters out to the 

10          tenants telling them that they should 

11          cross-check their right to a lower rent 

12          because the apartment had been illegally 

13          deregulated.  Your agency instead decided to 

14          send the letters to the owners.  I believe 

15          you've reported 22,000 of those 50,000 units 

16          have reregistered.  

17                 So two questions.  One, now what are 

18          we going to do to get the other 28,000 units 

19          back into the program?  And two, what are we 

20          going to do to make sure that all 50,000 

21          units are registered at the correct rent?  

22          Because the assumption is the vast majority 

23          of those units are actually now registered 

24          under rent regulation, as they always should 


 1          have, but under an illegally high rent.

 2                 COMMISSIONER RUBIN:  Thank you, 

 3          Senator.  You asked an elephant of a 

 4          question, so I'm going to bite little pieces 

 5          of it off at a time, if that's okay.  

 6                 You are absolutely correct that 

 7          earlier this year our agency sent out a large 

 8          group of letters to developers and landlords 

 9          who had previously received -- had been the 

10          beneficiaries of the J-51 tax abatement 

11          program in New York City.  And as a result of 

12          the benefit, they have certain 

13          rent-stabilization obligations in those 

14          buildings.  Much of the reporting, I'm sorry 

15          to say, on the results of that mailing has 

16          been inaccurate.  And there's a two-word 

17          phrase that other people are using for 

18          inaccurately reported news that I'm not going 

19          to use here that's sort of come into 

20          popularity recently.

21                 But just so we're all in agreement on 

22          what actually happened, we did do a mass 

23          mailing.  The results were exactly what we 

24          had hoped that they would be, in many ways, 


 1          which is all the landlords -- well, not all, 

 2          but the landlords that we mailed to, the 

 3          developers that we mailed to in many cases 

 4          responded to us with -- you know, either by 

 5          reregistering or by telling us the reasons 

 6          for which they were not -- they hadn't been 

 7          in what we'd consider to be compliance.  And 

 8          then we were also able to do, in the interim, 

 9          more research of our own.  

10                 The result of that is not that 22,000 

11          buildings were reregistered -- or apartments 

12          were reregistered --

13                 SENATOR KRUEGER:  Apartments.

14                 COMMISSIONER RUBIN:  Yeah, apartments, 

15          I'm sorry, were reregistered.  Twenty-two 

16          thousand apartments have come back onto our 

17          registration rolls in that time, which is 

18          correct, or something like that.  But that is 

19          the result of all kinds of other work that we 

20          do with the rent-stabilized portfolio, not 

21          this particular J-51 initiative.  And it's a 

22          testament to, you know, the good work that 

23          ORA does and TPU and other parts of our 

24          agency.  That was the entire bolus of 


 1          apartments that came back on.

 2                 Apartments that came back on from the 

 3          J-51 effort was a smaller number.  I can find 

 4          out what that was, if you'd like, at some 

 5          time later. 

 6                 But what we've since figured out, due 

 7          to our original research, is that while we 

 8          sent out I think 4,000 letters, or letters to 

 9          4,000 developers, in fact we think that the 

10          number of developers who are not in 

11          compliance with the law as we now know it to 

12          be -- and I'll come back to that in second -- 

13          is something like 200.  

14                 And we are now initiating the next -- 

15          you know, we're taking on the next phase of 

16          our work, which is we're going back out to 

17          those -- right now, going back out to those 

18          200 developers -- a much smaller group, 

19          obviously -- explaining to them -- you know, 

20          explaining, in quotes, to them their 

21          obligations, reminding them of their 

22          obligations, and giving them an opportunity 

23          to remedy themselves, but also telling them 

24          that we are now preparing to execute a much 


 1          more rigorous and aggressive compliance 

 2          effort.

 3                 SENATOR KRUEGER:  I'm sorry, just let 

 4          me get the numbers down.

 5                 COMMISSIONER RUBIN:  Sure.

 6                 SENATOR KRUEGER:  So you're saying 

 7          that the 22,000 in fact is the number based 

 8          on all the different programs in your agency.  

 9                 COMMISSIONER RUBIN:  Correct.

10                 SENATOR KRUEGER:  And you credited 

11          TPU, and I'll give you that.  So then you 

12          said so of the 50,000 you said you were going 

13          to try to recapture specific to the J-51 

14          exemption, Roberts v. Tishman Speyer ruling 

15          of seven years ago, how many responded?  How 

16          many of those 22,000 were from that?  

17                 COMMISSIONER RUBIN:  I'd have to get 

18          you -- I'll come back to you with those 

19          numbers, if I can.

20                 SENATOR KRUEGER:  Okay.  So basically, 

21          based on my question, so we didn't get 

22          anywhere near half of 50,000, we got far, far 

23          less from this effort on this specific issue?  

24                 COMMISSIONER RUBIN:  And I guess I 


 1          would consider that good news/bad news.  The 

 2          good news is that the compliance level, based 

 3          on the further research that we've been able 

 4          to do, the compliance level is actually much, 

 5          much higher than we had anticipated.  The 

 6          50,000 was an estimate that was, you know, 

 7          partly as a result of our internal -- you 

 8          know, sort of our preliminary internal 

 9          analysis that we did in partnership with the 

10          city.  And partly, frankly, our data is 

11          imperfect, you know, for sure.  Fifty 

12          thousand was the outside, probably the 

13          outside range of how many apartments might 

14          have been not registered that ought to have 

15          been registered.  

16                 And the good news is, I think, for the 

17          public, the good news is that the landlord 

18          community is actually largely in compliance.  

19                 But there are, as I said, we think now 

20          something like 200 developers who are out of 

21          compliance, as we consider it, and that's who 

22          we're going to talk to next.

23                 SENATOR KRUEGER:  And what are you 

24          going to do to both bring them into 


 1          compliance and to make sure that the 

 2          calculations are done to assure these 

 3          apartments are in fact -- or these landlords 

 4          are calculating the correct rent they should 

 5          be collecting?  

 6                 COMMISSIONER RUBIN:  So we're going 

 7          out with another series of letters, I 

 8          think -- I won't actually be sitting in this 

 9          seat anymore, but RuthAnne will be sending 

10          out another series of letters within a very 

11          short period of time -- you know, it's weeks, 

12          not months -- to the 200 we've identified, 

13          informing them that they are, we believe, out 

14          of compliance -- you know, some of them will 

15          have complied already, and some not.  But for 

16          whatever reason, we are now -- this is the 

17          group -- telling them that they've got until 

18          a date certain, and it's a very quick date 

19          certain, it's not -- you know, again, it's 

20          weeks, not months -- a date certain to 

21          comply, and that we are reserving all of our 

22          enforcement rights.  And then shortly 

23          thereafter we're just going to start 

24          exercising those rights.  It's a package of 


 1          pretty robust rights that we can talk about 

 2          separately, but that we have under our 

 3          authority as manager of the -- and oversight 

 4          authority of the rent-stabilized portfolio.

 5                 In terms of, you know, from the tenant 

 6          perspective, obviously, first and foremost is 

 7          the question of, Well, how much rent should I 

 8          have been paying during this period?  Which 

 9          is determined, as in all cases, through an 

10          overcharge proceeding.  And in that sense, 

11          it's no different than any other overcharge 

12          proceeding, which our ORA does many thousands 

13          of these every year.  

14                 I'm sorry to say it is a complicated 

15          thing to undertake.  There is no sort of 

16          one-size-fits-all way to figure out how much 

17          rent you should have been paying, over what 

18          period of time and from when and all that.  

19          Each one is very much a bespoke, you know, 

20          transaction.  But obviously we are there and 

21          intent on protecting the tenants' rights to 

22          engage in that discussion.  

23                 And then once the agency, in 

24          partnership with the tenants and landlords, 


 1          has determined what in fact the overcharge 

 2          amount is, we will enforce through all means 

 3          necessary to make sure that they get their 

 4          rebates.

 5                 SENATOR KRUEGER:  And I'm going to 

 6          switch to the new commissioner, if you don't 

 7          mind.

 8                 COMMISSIONER RUBIN:  Please.  That's 

 9          why she's here.

10                 SENATOR KRUEGER:  Since you'll be out 

11          of the building.

12                 So I would, on behalf of the 

13          Legislature, very much like -- not today -- 

14          but more detail about if that universe wasn't 

15          50,000, what is that universe; what was the 

16          difference between what you thought created 

17          the number 50,000 versus the number you are 

18          now determining; again, how many of those -- 

19          how many you've actually brought back in, 

20          because clearly it's not the 22,000, as the 

21          outgoing commissioner just said -- outgoing, 

22          incoming -- and then also what you're going 

23          to do to notify tenants of the possibility 

24          that they've been overcharged.  


 1                 Because as we know, under the law, the 

 2          tenants have to trigger a request for, true, 

 3          an overly complicated but necessary process 

 4          in order to get their rent fixed.  So there's 

 5          no reason to assume, even if you find out 

 6          there's X number and whatever that X number 

 7          is -- not 50,000, but some other number -- 

 8          unless the tenant knows, nothing is going to 

 9          go forward.

10                 So I'd like to know the going-forward 

11          steps from you.

12                 EX. DEP. COMMISSIONER VISNAUSKAS:  

13          We'd be happy to pull that together and come 

14          sit with you and go through it.

15                 SENATOR KRUEGER:  Great.  And I'm just 

16          done with Round 1, so I'll be back.  

17                 Thank you, Senator.

18                 CHAIRWOMAN YOUNG:  Thank you.  

19                 We've been joined by Senator 

20          Velmanette Montgomery.

21                 CHAIRMAN FARRELL:  We've been joined 

22          by Brian Kavanagh, who will now ask some 

23          questions.

24                 ASSEMBLYMAN KAVANAGH:  Thank you, 


 1          Mr. Chairman.  

 2                 And thank you for being here today.  

 3                 I know that there's been some 

 4          discussion of this already, but I just want 

 5          to follow up on the -- with regard to funding 

 6          for public housing in New York.  As you know, 

 7          two years ago we added $100 million to the 

 8          budget, through the JPMorgan settlement 

 9          funds.  And that money, most of it is yet to 

10          be spent.  And we did it in a pretty unusual 

11          way, with -- rather than doing a direct 

12          capital allocation to the housing authority, 

13          we set up an arrangement at the suggestion of 

14          the Executive that the Division of Budget and 

15          DASNY and your agency play some role in 

16          determining how that money gets spent.  And 

17          that rather than NYCHA, the New York City 

18          Housing Authority, spending that money, that 

19          DASNY be responsible for making the projects 

20          happen.

21                 Can you talk about the effectiveness 

22          of that approach from your perspective?  

23                 COMMISSIONER RUBIN:  Thank you, 

24          Mr. Kavanagh.  Absolutely.  I should say we 


 1          had a brief discussion about this with 

 2          Mr. Mosley, but I'm happy to --

 3                 ASSEMBLYMAN KAVANAGH:  No, I 

 4          understand.

 5                 COMMISSIONER RUBIN:  -- I'm happy to 

 6          continue to talk about it.

 7                 The $100 million, you're exactly 

 8          right, the $100 million was in the budget two 

 9          years ago.  The Governor, I think -- and I 

10          should say I wasn't -- I'm not sure I was in 

11          this seat exactly at that time.  But my 

12          understanding at the time was that the 

13          Executive, in partnership with the 

14          Legislature, came up with a set of projects 

15          specifically targeting primarily security and 

16          other critical matters across as wide of the 

17          NYCHA portfolio as they could come to an 

18          agreement on with $100 million.  Which is, on 

19          the one hand, a lot of money; on the other 

20          hand, pales in comparison to the $17 billion 

21          capital backlog that NYCHA has, as 

22          Mr. Cymbrowitz said.

23                 It was a good project list.  I saw the 

24          project list.  HCR's role in executing that 


 1          project list was more consultative than 

 2          anything else.  But in partnership with our 

 3          colleagues at DASNY, who really had the 

 4          execution responsibility, and NYCHA, we did 

 5          come up with a plan to invest that money in 

 6          those projects in the NYCHA portfolio.  And 

 7          the first $50 million or so had been 

 8          transmitted over to DASNY for that purpose.

 9                 And as I said earlier, I think that 

10          the number is something like 10 million or a 

11          little bit more than 10 million has actually 

12          been put to work in NYCHA security projects.

13                 The challenges, I agree with you, 

14          there have been some challenges.  

15          "Challenges" is the word that I think people 

16          like me use when you're talking about things 

17          like this.  It means it hasn't worked all 

18          that well.

19                 ASSEMBLYMAN KAVANAGH:  That's a kind 

20          word, yes.

21                 COMMISSIONER RUBIN:  But there have 

22          been challenges in moving that money as 

23          quickly as everybody would have hoped.  It is 

24          an intense focus of, in particular, DASNY -- 


 1          and I believe with NYCHA at this point -- to 

 2          try and move those projects faster and make 

 3          those investments because they are 

 4          absolutely -- they were sort of focused on 

 5          quality-of-life issues, security, things like 

 6          that.

 7                 ASSEMBLYMAN KAVANAGH:  Partly because 

 8          the Executive put some restriction on what we 

 9          could do with the money.

10                 But again, the effectiveness -- you're 

11          now proposing effectively to replicate this 

12          program for the next couple of years, with 

13          some additional restrictions.  Is the -- and 

14          that's the royal "we" I'm talking about, the 

15          Executive.  Generally I know this isn't your 

16          proposal specifically, and there's another 

17          agency involved.  But if this -- if it's 

18          23 months later and only 10 percent of the 

19          money has been -- is moving on some very 

20          straightforward, very modest projects in 

21          housing that desperately needs the work, why 

22          would we, you know -- maybe that was -- it 

23          seemed like a good idea at the time.  But why 

24          would we continue that approach rather than 


 1          allocating the money to an agency with a very 

 2          large capital budget and very substantial 

 3          needs?  Why would we go through this 

 4          multilayer process again?

 5                 COMMISSIONER RUBIN:  It's a perfectly 

 6          reasonable question.  I guess I would make a 

 7          couple of observations.  One, the 

 8          $100 million in this budget proposal for the 

 9          next five years, I don't know that there's 

10          any particular precondition for -- you know, 

11          we don't come in with necessarily a similar 

12          set of projects that we would propose to 

13          invest it in that I'm aware of.  Although, 

14          you know, it's --

15                 ASSEMBLYMAN KAVANAGH:  There's not a 

16          specific set of projects.  But is there not a 

17          requirement that the money again go through 

18          DASNY, which has no experience doing these 

19          kinds of projects in public housing in 

20          New York and has failed to do this so far?

21                 COMMISSIONER RUBIN:  Sure.  And I 

22          guess I -- based on my familiarity with this 

23          process, and also, frankly, some familiarity 

24          with both DASNY and NYCHA, from this and 


 1          other places -- and RuthAnne may echo this -- 

 2          I think we've learned a lot, frankly, over 

 3          the last 23 months about how to execute this 

 4          kind of program.  And I think that the pace 

 5          is picking up some for exactly that reason.  

 6                 By the way, some of your colleagues, 

 7          staff in the Legislature have helped us, as 

 8          well as the Division of Budget.  So I think 

 9          going forward we can do much, much better.  

10                 I would also say frankly that while 

11          DASNY -- you know, nobody, obviously, is 

12          perfect.  I have worked with DASNY in the 

13          past on many, many small projects, 

14          particularly when I was at Storm Recovery, 

15          and they have -- they're very, very good at 

16          getting money out the door pretty quickly --

17                 ASSEMBLYMAN KAVANAGH:  This isn't -- 

18          again, their obligation here is not to get 

19          money out the door, their obligation is to go 

20          into buildings on Avenue C and D in my 

21          district and replace windows.  And it's two 

22          years later, and, you know, tenants are 

23          suffering conditions that could be addressed 

24          with money that we allocated for two years, 


 1          and now we're talking about basically 

 2          continuing that approach.  

 3                 And I see my time is running short, 

 4          but -- and the basic question I haven't 

 5          gotten an answer to is why would we do it 

 6          this way.  It's unique, it's not the way 

 7          you're proposing to do public housing capital 

 8          in other parts of the state.  

 9                 And just -- I mean, one more -- just 

10          one more question about the level of funding.  

11          We did $100 million two years ago.  There was 

12          a proposal to do $100 million last year.  

13          Unfortunately, we were unable to come to an 

14          agreement in an MOU on how to spend that 

15          money.  Now the last year's $100 million is 

16          just being rolled into this year's budget.  

17          Aren't we due another $100 million if we want 

18          to maintain the level of commitment we agreed 

19          to two years ago?

20                 COMMISSIONER RUBIN:  Well, I'm not 

21          sure I'm following that question exactly, 

22          but --

23                 ASSEMBLYMAN KAVANAGH:  Well, if we 

24          would have done the -- if we did $100 million 


 1          two years ago and we were -- planned to do 

 2          $100 million last year but failed to do so, 

 3          wouldn't we -- had we not failed to come to 

 4          an agreement on that $100 million, wouldn't 

 5          we be talking about another $100 million this 

 6          year?  

 7                 Are you suggesting that the 

 8          $100 million that is proposed now is the 

 9          entire Executive commitment to NYCHA for the 

10          next five years?  You just described it that 

11          way a moment ago.

12                 COMMISSIONER RUBIN:  In terms of 

13          capital subsidy, absolutely.  But as my 

14          colleague RuthAnne talked about earlier, at 

15          the end of December of this past year, we had 

16          the ability to execute a $400 million capital 

17          project that far exceeds anything that 

18          anybody has done -- I think -- any other 

19          capital project I'm familiar with in NYCHA, 

20          to do a $400 million capital project in the 

21          Rockaways in Ocean Bay.  It was the largest 

22          such project under this RAD program in the 

23          country by magnitudes.  And it's going to 

24          result in I think it's 1500 -- is it 1500 


 1          apartments? -- something like 1400 apartments 

 2          in Ocean Bay being almost entirely overhauled 

 3          and, by the way, made far more sustainable 

 4          and resilient in a project that, as you know, 

 5          is surrounded by the water on two sides.  

 6                 ASSEMBLYMAN KAVANAGH:  Right, and --

 7                 COMMISSIONER RUBIN:  Not a dollar of 

 8          capital subsidy from the Executive Budget 

 9          went into that project.  We did it entirely 

10          with tax-exempt bonds and other sources.  

11                 So we would much prefer, frankly, to 

12          replicate that project over and over again -- 

13          we've done that in other places outside of 

14          New York City -- than to snip off little 

15          pieces, albeit important, of additional 

16          capital funding for very, very small -- or we 

17          can do both -- small quality-of-life.  If we 

18          did that as large projects, I think we'd find 

19          that we could make an enormous dent in --

20                 ASSEMBLYMAN KAVANAGH:  With all due 

21          respect, the $100 million was done on small, 

22          what you call quality-of-life projects.  I 

23          don't think working front doors on your 

24          building really count as quality of life in 


 1          my book, but -- it was done in small 

 2          snippets, partly at the insistence of the 

 3          executive branch two years ago, and we have 

 4          yet to see any of that money in our 

 5          communities.

 6                 And my time is more than out, so I'll 

 7          leave it there.  Thank you.

 8                 COMMISSIONER RUBIN:  Thank you, sir. 

 9                 CHAIRWOMAN YOUNG:  The next speaker is 

10          Senator Bailey.

11                 SENATOR BAILEY:  Good morning to you 

12          both.

13                 COMMISSIONER RUBIN:  Good morning, 

14          sir.

15                 EX. DEP. COMMISSIONER VISNAUSKAS:  

16          Good morning.

17                 SENATOR BAILEY:  Thank you for coming.  

18          I would be remiss if I did not recognize my 

19          predecessor in government, Senator Ruth 

20          Hassell-Thompson, former Senator Ruth 

21          Hassell-Thompson.  Hello, Ruth.  How are you?  

22          Always a pleasure to see you.

23                 COMMISSIONER RUBIN:  Our colleague.

24                 SENATOR BAILEY:  A moment of personal 


 1          privilege, if you so allow me.

 2                 A couple of questions for you today.  

 3          The first is concerning Mitchell-Lama.  I 

 4          represent the largest Mitchell-Lama 

 5          development in the entire country, in 

 6          Co-op City.  I'm going to ask not just for 

 7          Co-op City but for the rest of the 

 8          Mitchell-Lamas in the State of New York.  

 9                 You mentioned that 35 Mitchell-Lama 

10          projects will be revitalized.  Can you 

11          provide me with a list of those projects?  

12                 EX. DEP. COMMISSIONER VISNAUSKAS:  

13          Yes, as part of the UDC portfolio coming over 

14          to HCR, we have a five-year plan to refinance 

15          Mitchell-Lamas.  We've done about 26 to date.  

16          As Commissioner Rubin said in his testimony, 

17          we've done about 6600 of 8600 apartments.  So 

18          we are on track and on schedule to do the 

19          whole portfolio.  And we'd be happy to 

20          provide you with a list of those.

21                 SENATOR BAILEY:  Thank you.  And 

22          another point of personal privilege, is there 

23          anything in the outline for Co-op City?

24                 EX. DEP. COMMISSIONER VISNAUSKAS:  We 


 1          have funding for Mitchell-Lamas.  Co-op City 

 2          itself has not come to us with a specific 

 3          ask.  We are always happy to talk to any 

 4          development companies that want to come in 

 5          and talk to us about their projects.

 6                 SENATOR BAILEY:   Another question, 

 7          concerning TPU.  While not necessarily to 

 8          what TPU does, we've seen in the City of 

 9          New York what can happen to tenants when you 

10          have bad landlords.  And while the laudable 

11          mission of TPU is not germane to what those 

12          bad landlords are doing, we need to make sure 

13          that tenants are always protected.  And I'm 

14          concerned that there is no specific line set 

15          out in the Executive Budget for TPU.  

16                 Could you talk about why that's taken 

17          place and why that's continued to be 

18          discretionary?

19                 EX. DEP. COMMISSIONER VISNAUSKAS:  So 

20          there's actually a change in our budget this 

21          year from last year, and we do have a 

22          specific line called out for $4.5 million to 

23          fund TPU, and that's the same level of 

24          funding that it had last year.  Although 


 1          you're right, certainly, in saying that last 

 2          year it was not specifically called out but 

 3          was subsumed within other budget lines.

 4                 SENATOR BAILEY:  Okay.  And the final 

 5          question that I have for you, I think it's -- 

 6          I don't want to keep beating a dead horse, 

 7          but I have six NYCHA developments in my 

 8          district.  And as you mentioned earlier, it's 

 9          not just capital, it's other issues.  And I 

10          guess my major concern is, how are we going 

11          to come to solve these other issues, these 

12          other non-capital -- these quality-of-life, 

13          these fencing issues that we have, the 

14          groundwork that needs to get done?  What role 

15          are we going to -- are you -- is HCR going to 

16          play in making sure that these NYCHA 

17          developments are going to get what they need, 

18          aside from the capital developments and 

19          obvious roof repairs that are evident?  

20                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

21          think, first and foremost, we have a really 

22          good working relationship with NYCHA, so I 

23          think that's the start.  And as you know, 

24          they laid out several years ago a 10-year 


 1          plan for themselves that lays out their 

 2          priorities and how they want to work through 

 3          a process of addressing their backlog and 

 4          addressing their needs citywide.  

 5                 So we take our cues from them.  And 

 6          where they feel there's priorities, as they 

 7          did in December around the Ocean Bay project, 

 8          we, you know, stand at the ready to work with 

 9          them in ways that we can.

10                 SENATOR BAILEY:  Okay, excellent.  

11                 Thank you, that will be all for now.

12                 CHAIRWOMAN YOUNG:  Thank you, Senator.  

13                 CHAIRMAN FARRELL:  Thank you.  

14                 We've been joined by Assemblywoman 

15          Niou, and she will now ask questions.

16                 ASSEMBLYWOMAN NIOU:  Hi.  I was 

17          watching, and I know that a lot of questions 

18          were covered already that I had.  But I 

19          wanted to ask -- along with Assemblymember 

20          Kavanagh and other elected officials and 

21          advocates, I'm part of a lead task force 

22          which has a goal to reduce exposure to lead 

23          paint, especially the poisoning, particularly 

24          lead exposure created by hazardous 


 1          construction or demolition around housing 

 2          units.  

 3                 The task force is interested in 

 4          meeting with the state, HCR and DOH to figure 

 5          out ways to improve the prevention of lead 

 6          exposure.  Can you commit that your agency 

 7          will meet with our lead task force?

 8                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 9          We'd be happy to.

10                 COMMISSIONER RUBIN:  Yes.  I'm going 

11          to commit, in both my new role, which is 

12          irrelevant after today -- in my existing role 

13          and my new role.  In my existing role, I'll 

14          say absolutely.  In my new role, I'll say 

15          absolutely.  And I'm sure RuthAnne --

16                 EX. DEP. COMMISSIONER VISNAUSKAS:  

17          Yeah, couldn't agree more.  We'd be happy to 

18          meet.

19                 COMMISSIONER RUBIN:  Yes.  Yeah.  It's 

20          a priority for us and for the Governor.

21                 ASSEMBLYWOMAN NIOU:  Great.  So you 

22          heard it.  And, you know, also we have -- you 

23          know, the city gets $5.5 billion annually 

24          from the federal government, money that 


 1          unfortunately the Trump administration is 

 2          threatening to revoke.  We use that money to 

 3          provide Section 8 vouchers for poor 

 4          New Yorkers, to building housing for families 

 5          at 30 percent of AMI and below, to ensure 

 6          that our housing stock is physically safe.  

 7          And how can this administration justify a 

 8          $2.4 billion annual expense in the pocket of 

 9          developers in this climate?

10                 COMMISSIONER RUBIN:  That -- I guess I 

11          should ask which specifically --

12                 ASSEMBLYWOMAN NIOU:  We're talking 

13          about 421-a, I guess.  I know that we were 

14          talking about it previously.

15                 COMMISSIONER RUBIN:  421-a, that's a 

16          question -- I think you're asking about the 

17          Affordable New York Housing Program.

18                 ASSEMBLYWOMAN NIOU:  Mm-hmm.

19                 COMMISSIONER RUBIN:  I -- so a couple 

20          of things.  We share your commitment to 

21          Section 8, the importance of Section 8.  As 

22          you know, the state is also responsible for a 

23          big chunk of the section 8 program, largely 

24          outside of New York City.  We have about, I 


 1          think, 40,000 vouchers that we're responsible 

 2          for.  

 3                 We share your commitment to it and 

 4          would be alarmed and push back very hard at 

 5          any attempts to rein that program in from 

 6          Washington, although we don't anticipate that 

 7          at the moment.

 8                 As far as the expense of the 

 9          Affordable New York Housing Program, or what 

10          used to be known as 421-a, the $2.4 billion 

11          number, there are numbers -- you know, there 

12          are estimates all over the place as to the 

13          cost of it.  So I -- rather than -- and that 

14          could be -- I'm not sure which specifically 

15          which piece that attaches to.  

16                 But I guess I would say that the 

17          principal cost of 421-a, of the Affordable 

18          New York Housing Program, comes from two 

19          things:  The existing rental base of 

20          buildings that were developed under this 

21          program going back, you know, at this point 

22          decades, because it's a -- well, I guess most 

23          of them would have rolled off by this point.  

24          But buildings constructed in past years under 


 1          the old program that continue to get the tax 

 2          abatement benefit every year, and that builds 

 3          up, obviously.  

 4                 And then more recently, the projected 

 5          cost -- although because the program was 

 6          paused, it never took them into effect, 

 7          really.  But the projected cost of the 421-a, 

 8          what was then called the 421-a program, that 

 9          was proposed really by the mayor of the city 

10          and adopted by the -- passed by the 

11          Legislature last year with this MOU, with the 

12          MOU requirement attached to it.  

13                 And as you know, the mayor came to the 

14          Legislature with a very, very substantial, 

15          really radical reworking of 421-a, making it 

16          citywide -- or citywide requirements, 

17          affordability requirements, three different 

18          options plus a small condo option.  You know, 

19          all kinds of other changes.  You know, we can 

20          have a different-spirited philosophical 

21          debate about whether we like it or not, but 

22          the fact is it was designed and I think 

23          effectively designed to develop much more 

24          affordable housing over the next several 


 1          years, and in return to provide a much more 

 2          extensive tax benefit to developers who 

 3          develop that housing as well as the rental 

 4          housing -- non-affordable rental housing 

 5          attached to it.  

 6                 The estimated cost of that program 

 7          was, you know, by some accounts in the 

 8          billions of dollars, and I suspect that's the 

 9          2.4 that you're talking about.

10                 But, you know, the program isn't up 

11          and running yet.  I don't think we yet know 

12          how it's going to play out.  It is certainly 

13          very, very expensive, much more expensive on 

14          an annual basis than the program that existed 

15          before, but it also develops a lot more 

16          affordable housing.  And that's the trade 

17          that the mayor -- and, you know, we give due 

18          deference to him in terms of making his own 

19          strategy for the development of affordable 

20          housing using city resources.  That was the 

21          decision that they made.

22                 The program in front of you today has 

23          a very, very modest change from what he came 

24          forward with, and nothing like -- and that 


 1          $2.4 billion really dates back to long 

 2          preexisting programs and then the mayor's 

 3          program.

 4                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

 5          think, if I might just add, I agree we stand 

 6          concerned about potential cuts at the federal 

 7          level, certainly, and will work very closely 

 8          with our congressional leadership in DC to 

 9          maintain advocating that there aren't any 

10          cuts.  

11                 And I think I would just say in 

12          addition to what Jamie said that, you know, 

13          421-a is critical for production of rental 

14          housing across New York City.  And New York 

15          City, as you know, is a rental city.  And to 

16          the extent that it provides affordable units 

17          between 421-a and the $2 billion that is in 

18          the budget right now for housing, that it's 

19          not the time to sort of stop, it's the time 

20          to double down and make sure that we have all 

21          the tools we have to make sure we can provide 

22          as much affordable housing throughout the 

23          state as we can.

24                 ASSEMBLYWOMAN NIOU:  And we have 


 1          88,000 homeless folks.  And, you know, I just 

 2          think that we're making other people rich 

 3          when then there's 88,000 homeless people 

 4          across the state, so --

 5                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 6          Supportive housing is extremely important to 

 7          us.  We have a really robust supportive 

 8          housing pipeline.  We have a large commitment 

 9          to it.  We couldn't agree more, it's 

10          incredibly important to us.

11                 ASSEMBLYWOMAN NIOU:  I just feel we 

12          could just do more there.

13                 COMMISSIONER RUBIN:  Thank you.

14                 ASSEMBLYWOMAN NIOU:  Thank you, Chair.

15                 Thank you.  

16                 CHAIRMAN FARRELL:  Thank you.

17                 CHAIRWOMAN YOUNG:  Thank you.  Our 

18          next speaker is Senator Savino.

19                 SENATOR SAVINO:  Thank you, Senator 

20          Young.

21                 I want to go back to the conversation 

22          that you were having with Assemblyman 

23          Kavanagh about the condition of the New York 

24          City Housing Authority.  


 1                 It's guaranteed every year, at some 

 2          point, some downstate City Council member or 

 3          citywide elected official is going to have a 

 4          press conference where they have a list of 

 5          the worst landlords and slumlords in New York 

 6          City, and they'll put their picture and all 

 7          the properties they own.  And I'm always 

 8          surprised that on the top of that list is not 

 9          the City of New York and the New York City 

10          Housing Authority.  

11                 The conditions in the NYCHA 

12          developments are absolutely deplorable.  You 

13          know that.  And as Assemblyman Kavanagh said, 

14          we put $100 million in two years ago, there 

15          was supposed to be $100 million last year, 

16          and I think we're proposing another 

17          $100 million this year.

18                 The concern is, though, that no matter 

19          how much money we seem to move through there, 

20          we still have dilapidated conditions in the 

21          majority of the developments.  We have leaky 

22          roofs, we have windows that have -- they're 

23          on the waiting list for years to replace 

24          them.  The hallways, the mold conditions -- a 


 1          few years ago, after Hurricane Sandy and we 

 2          saw what was happening with people who were 

 3          taking advantage of affected homeowners whose 

 4          homes were infested with mold, we decided to 

 5          create a licensing requirement for mold 

 6          removal in New York State.  

 7                 Surprisingly, though, the New York 

 8          City Housing Authority was carved out of it, 

 9          because they didn't want to be held to that 

10          standard.  And so all of the mold remediation 

11          that seems to take place in NYCHA 

12          developments is substandard, and the mold 

13          returns before the guy leaves -- gets off the 

14          elevator.  And that's usually because the 

15          elevators aren't working anyway.

16                 (Laughter.)

17                 SENATOR SAVINO:  So the conditions 

18          there are absolutely deplorable.  

19                 So while I think it's important that 

20          we provide the funding, I'm concerned about 

21          what happens to the funding we're providing 

22          and whether or not it's ever going to get to 

23          the repairs and the backlogs that's 

24          necessary.


 1                 So as you know, Jamie, the IDC, under 

 2          Senator Klein, we've proposed this idea about 

 3          a year or so ago about creating a new method 

 4          of doing the repair work at NYCHA, a repair 

 5          certificate program that would award 

 6          developers with zoning bonuses in areas 

 7          subject to upzoning, in exchange for 

 8          developers conducting the repairs directly at 

 9          NYCHA buildings, in an effort to move these 

10          repairs faster.  

11                 We know NYCHA can't do it.  We know 

12          it, whether it's a shortage of staff, a 

13          shortage of funding, or just the staff 

14          doesn't have the training or the skills or 

15          whatever is necessary.  But in the meantime, 

16          we have 179,000 tenants who are living in the 

17          most deplorable conditions that we would 

18          normally embarrass a landlord from, and how 

19          do we allow this to continue?  So why not 

20          find an alternative way to do this?  

21                 So what would your thoughts be on a 

22          repair certificate program?

23                 COMMISSIONER RUBIN:  Let me say a 

24          couple of things, if I could. 


 1                 First of all, we'd be delighted to 

 2          look at the program.  And, RuthAnne, I don't 

 3          know that you've had a chance to see it --

 4                 EX. DEP. COMMISSIONER VISNAUSKAS:  No, 

 5          I have not.

 6                 COMMISSIONER RUBIN:  But if it's given 

 7          to her, she will respond quickly to it.  

 8          Offline, obviously.

 9                 I -- we obviously share your concerns 

10          about the condition of NYCHA housing.  

11          It's -- there's no denying that there is a 

12          tremendous capital need.  We've already 

13          talked about it in other contexts.  And the 

14          state has a commitment to trying to 

15          address -- within reason, trying to 

16          address -- within its capabilities, trying to 

17          address that need.

18                 I can't say anything in particular 

19          about NYCHA's internal processes, because I 

20          don't have, frankly, direct experience.  

21          NYCHA's leadership is -- Shola Olatoye is a 

22          colleague and a friend and somebody that we 

23          work with closely who has tremendous energy 

24          and vision, I think, and has made great 


 1          strides against all kinds of headwinds.  And 

 2          so, you know, I think they've got tremendous 

 3          leadership, but they also have tremendous, 

 4          tremendous problems that way predate her.

 5                 We are absolutely interested in 

 6          working on anything with NYCHA that would 

 7          help her get her job done.  And that is -- I 

 8          think she views that, what you just 

 9          addressed, as being job one, frankly, for 

10          her.

11                 I would say a couple of other things.  

12          One, I will keep coming back to this, the 

13          single most -- highest impact, putting aside 

14          alternative -- you mentioned alternatives.  

15          So whatever it is that the world has been 

16          trying to do to fix NYCHA's problems has not 

17          been working all that well.  And you have to 

18          keep pushing ahead for more federal subsidy, 

19          you have to do everything you're doing and 

20          try to do the blocking and tackling every 

21          day, but alternatives are what is needed 

22          here, I agree with you.  

23                 The single smartest alternative 

24          program for fixing NYCHA and other public 


 1          housing that's been developed and executed in 

 2          the last several years account is the RAD 

 3          program coming out of HUD.  And it is the -- 

 4          it's the basis on which we did this 

 5          $400 million deal that I talked about 

 6          earlier.  We've done other similar RAD 

 7          projects throughout the state.  It's 

 8          applicable to any public housing authority 

 9          that can apply and be certified.  

10                 And we have other projects elsewhere 

11          in New York State, public housing projects 

12          that we're working with actively, that look 

13          much like NYCHA in terms of their capital 

14          backlogs and the quality of their housing.  

15          That's how we're going to make the kind of 

16          impact that we need to make for the people 

17          that live in public housing in this state and 

18          across the country.

19                 There are other things we can do, but 

20          that's it right there.  That's the only way 

21          to attract enough capital from all sources in 

22          hundreds of millions of dollars, which is the 

23          size that we need, to fix public housing in 

24          this country.  And if we don't do it, if we 


 1          don't take every advantage of those programs, 

 2          it's a disgrace.  So that's the smart 

 3          thinking that's already been done.  We don't 

 4          have to make something up; that's what we've 

 5          got.  And our agency, under RuthAnne's 

 6          leadership, is going to do everything we can 

 7          to execute more of those RAD projects 

 8          throughout the state.

 9                 I would also say that the quality of 

10          housing -- you know, preserving quality of 

11          housing is one of the couple of core missions 

12          of this agency.  Not just construction of new 

13          affordable housing, but preservation.  And 

14          again, RuthAnne comes with this very, very 

15          strong background in preservation, as you're 

16          going to find over the next few years here.  

17                 It's a problem not only in NYCHA but 

18          it's a problem throughout the state.  I mean, 

19          Senator Young referred earlier to the quality 

20          of rural housing in this state.  I have been, 

21          in my last two years, around the state to see 

22          rural housing -- USDA projects, for example, 

23          some of which she has in her district -- that 

24          look every bit as rundown and dilapidated as 


 1          anything you would see in NYCHA housing, 

 2          believe me, and are more exposed to the 

 3          elements in many cases because of where 

 4          they're located.  

 5                 Our agency is committed to not only 

 6          solving quality-of-life problems in NYCHA, 

 7          but we have a commitment statewide.  And that 

 8          is not true, for example, of the City of 

 9          New York's government, which obviously 

10          operates only in New York City.  And that's 

11          why when we talk about NYCHA, we do tend to 

12          say, well, it's fundamentally, first and 

13          foremost, New York City's responsibility.  We 

14          have a statewide mandate at this agency, and 

15          we don't have resources that are always sized 

16          up to meet that statewide mandate, we just 

17          have to meet everybody's needs throughout the 

18          state, 16 million people, which includes 

19          everything from the state of rural housing to 

20          the state of NYCHA and other public housing.  

21                 So, you know, all of that to say we're 

22          doing everything we can.  I agree with you 

23          about the need for NYCHA, and we're going to 

24          try to meet it as best we can moving forward, 


 1          while balancing all of our other 

 2          responsibilities.

 3                 SENATOR SAVINO:  Well, I would just 

 4          hope that we be open to alternative ways of 

 5          solving this problem, because the current 

 6          system does not work, as we know.  If you 

 7          speak to a tenant living in one of the NYCHA 

 8          developments -- I have 14 of them in Coney 

 9          Island, I have seven of them in 

10          Staten Island.  If you speak to someone who's 

11          been on a waiting list for two years to have 

12          a minor repair done on their apartment, after 

13          a while it becomes a little bit -- you know, 

14          it's degrading to people's humanity.  

15                 And I think that we need to find new 

16          ways to spend this money -- $100 million, 

17          $100 million, and $100 million, that's an 

18          incredible amount of money for an institution 

19          where it almost appears nothing is changing.  

20          And it's not -- and I'm not suggesting in any 

21          way that the people who work there aren't 

22          dedicated.  It's just a system that no longer 

23          works, and I think we need to find different 

24          ways to bring our public housing up to the 


 1          standard that it really should be.  We should 

 2          not be shaming private landlords when we are, 

 3          in my opinion, probably the worst slumlord in 

 4          the country.  

 5                 So I would hope that you would take 

 6          the opportunity to meet with us, take a look 

 7          at this repair certificate program as an 

 8          idea, as one of the tools in the box to take 

 9          NYCHA into the 21st century.  And I look 

10          forward to working with you on other issues.  

11                 Thank you.

12                 EX. DEP. COMMISSIONER VISNAUSKAS:  

13          Thank you.

14                 CHAIRMAN FARRELL:  Thank you.

15                 Assemblyman Cymbrowitz, first 

16          go-around.

17                 ASSEMBLYMAN CYMBROWITZ:  Thank you.  

18                 I'd like to go back to 421-a.  We 

19          talked about the fact -- you mentioned that 

20          it's HPD that does the regulations of 

21          abatement and exemption programs.  Some of us 

22          have been involved in that.  However, the 

23          proposed legislation removes the ability of 

24          New York City to restrict, limit, or 


 1          condition the eligibility, scope, or the 

 2          amount of 421-a benefits.  What's the 

 3          Executive's rationale for eliminating the 

 4          authority of New York City to the point where 

 5          they're not even part of the discussions?  

 6                 And the second part of my question is 

 7          about the borders drawn for the new 

 8          affordability areas in Manhattan, Brooklyn, 

 9          and Queens.  The Governor's proposed language 

10          refers to eligible buildings within a 

11          geographic boundary that refers to the 

12          bulkheads of the East River.  Can you explain 

13          this concept further, why bulkheads, of all 

14          things, were used, a mile from the bulkhead?  

15          We're laughing about it, but the concern is 

16          why would the Governor even propose this.  

17                 EX. DEP. COMMISSIONER VISNAUSKAS:  So 

18          to take your second question first, on the 

19          bulkheads, the idea was to go back to a 

20          geographic reference that had been in the 

21          previous 421-a statute for some time.  So 

22          it's something that is already written and 

23          familiar.  

24                 So in the old program, which you may 


 1          have been familiar with, where there was a 

 2          geographic exclusion area where there was the 

 3          requirement of affordability, the definition 

 4          of that had always been off the Queens and 

 5          Brooklyn bulkhead as a geographic reference.  

 6          So we maintained that same geographic 

 7          reference to be consistent with people who 

 8          are familiar with the program going back a 

 9          decade.

10                 The significance of the mile off of 

11          that in the Brooklyn-Queens waterfront is 

12          really meant to approximate high-opportunity, 

13          high-rent areas where it was felt that the 

14          fair wage could be accommodated, so as not to 

15          burden areas outside of that, where the rents 

16          are not high enough to support the wage.  

17                 To go to your first question about why 

18          New York City does not have the ability to 

19          override the program with more restrictive 

20          covenants, the thinking on that was the 

21          program that is proposed right now is largely 

22          the program that the city put forward and was 

23          approved by the Legislature in 2015, and that 

24          the modifications that are made now are not 


 1          intended to be changed to allow the industry 

 2          to -- it's a little bit of a pencils-down, if 

 3          you will, to allow the industry to move 

 4          forward and know that should they start 

 5          construction or be buying sites and want to 

 6          start construction a year from now, that the 

 7          421-a program as approved is the 421-a 

 8          program that they will have and they will be 

 9          able to finance against 12 months from now 

10          and 24 months from now.  

11                 ASSEMBLYMAN CYMBROWITZ:  So if your 

12          concern is that things will change a year 

13          from now, the goalposts will be moved, why 

14          not bring them to the table now?

15                 COMMISSIONER RUBIN:  I think it would 

16          be inaccurate to say that the city wasn't at 

17          the table, to be honest.  Obviously, you 

18          know, we -- RuthAnne and I both, and others 

19          in our agency, have a close working 

20          relationship with the housing agencies in the 

21          city:  HDC, HPD, and our colleagues all up 

22          and down those agencies.  They were -- you 

23          know, we, as the discussions went on to try 

24          to restart the program that, as RuthAnne 


 1          said, they really were responsible for 

 2          designing this restructured 421-a from 2015, 

 3          they were aware of the discussions.  I mean, 

 4          I think sometimes, frankly, the whole world 

 5          was, thanks to the media.  

 6                 But they certainly were aware of them, 

 7          they've had the ability to weigh in at 

 8          various times, their estimate of cost and 

 9          other aspects of the program.  I've heard the 

10          mayor comment on it.  You know, frankly, I 

11          haven't seen too much other comment from the 

12          city government.  But they've been certainly 

13          around at all points of the discussion.  

14                 And, you know, obviously this is now 

15          in front of the Legislature and they have the 

16          opportunity to work with the State 

17          Legislature to effect any changes that you 

18          and they think are necessary, obviously, 

19          with -- you know, understanding that this 

20          was -- the small piece of this, the changes, 

21          was the result of a pretty difficult 

22          discussion between the parties that were 

23          outlined in the MOU that was in the 

24          legislation you passed last time.  So I think 


 1          you'd want to be careful about making changes 

 2          that invalidate that deal because of the 

 3          importance of this program.

 4                 ASSEMBLYMAN CYMBROWITZ:  Well, we have 

 5          to do that now since they weren't there to be 

 6          part of it as part of the MOU.  So we have to 

 7          bring them in in order to understand what 

 8          their opinion is, if they're going to be 

 9          drawing the regulations and dealing with it 

10          specifically.  

11                 But the fact that they have been 

12          excluded and the fact that -- and 

13          incorporating what has occurred at NYCHA, 

14          with the capital dollars and getting those 

15          dollars spent and now having DASNY involved 

16          in the middle of it -- is there a signal 

17          that's being sent by the Executive to 

18          New York City?  It seems as if anything that 

19          has to do with New York City is not going to 

20          bring in New York City to the table of what 

21          they think might be the best way of getting 

22          things done.

23                 COMMISSIONER RUBIN:  Assemblyman, I 

24          can only comment in the context of the 


 1          housing world, which is --

 2                 ASSEMBLYMAN CYMBROWITZ:  Well, that's 

 3          all I'm talking about.  I'm only talking 

 4          about 421-a and NYCHA capital dollars.  It 

 5          seems as if a signal is being sent by the 

 6          Executive to the city.

 7                 COMMISSIONER RUBIN:  I would say no, 

 8          there is absolutely not a signal being sent.  

 9          It's actually -- it's quite explicit, I 

10          think.  In the case of the Affordable 

11          New York Housing Program, again, the program 

12          that is before you today, the three -- the 

13          three -- you know, with all the details, 

14          obviously -- but the three options plus a 

15          fourth small condo option, the AMI bands that 

16          were developed that are all different from 

17          what the 421-a was in prior years, but it 

18          merged in 2015, the extension of the tax 

19          abatement to 25 years from what it had been 

20          previously, which is more like eight and 

21          10 years, the removal of the geographic -- 

22          the GEA, the exclusion and all that -- all of 

23          those details were developed really by 

24          New York City.  They were not developed by 


 1          the state or by the Executive.  That program, 

 2          as you see it today, is basically a New York 

 3          City-developed -- and presumably in some 

 4          consultation with the Legislature, once you 

 5          were asked to pass it last time in 2015 -- 

 6          that was a New York City program.  The only 

 7          piece that comes from any other source other 

 8          than directly New York City is the change 

 9          that was necessary to restart the program, 

10          which is the wages and some modest -- you 

11          know, many years out extension of the 

12          abatement, and then some increases in 

13          affordability.  That's it.  And as I said 

14          earlier, on those pieces we were certainly in 

15          close contact with New York City.  

16                 So I think to say that that is -- that 

17          this program in particular reflects any 

18          message being sent to New York City is really 

19          not accurate.  

20                 With respect to the NYCHA funding, 

21          we've talked obviously about NYCHA before.  

22          New York City has its own responsibility, its 

23          own financial commitment that it's made to 

24          NYCHA.  I frankly think that, you know, the 


 1          Governor, by putting money in the -- by 

 2          committing $100 million in past years, with 

 3          your cooperation and partnership, and 

 4          hopefully $100 million in this year's budget 

 5          for the next five years, the Governor is 

 6          sending a signal, which is that the state 

 7          thinks it has some responsibility to NYCHA 

 8          and to other public housing.  

 9                 You know, how that money gets spent 

10          into NYCHA is an important but second-level 

11          issue.  The first order of business I think 

12          is get some more money to NYCHA, which he is 

13          proposing to do.

14                 ASSEMBLYMAN CYMBROWITZ:  But the 

15          $100 million, based on what is really needed 

16          at NYCHA, is crumbs.  And again, it's a 

17          signal that's being sent to the city.

18                 COMMISSIONER RUBIN:  Assemblyman, I 

19          really -- I disagree.  And that's -- that's 

20          what we're doing here.  But I do disagree.  

21          It's not a signal to the city.  The signal to 

22          the city is -- the signal to the city in 

23          terms of the funding that's being allocated 

24          is the state has a commitment to NYCHA.  It 


 1          also has a commitment to other public housing 

 2          statewide.  And as I said earlier, the 

 3          budget -- the State Budget and the housing 

 4          piece of the State Budget, while this is the 

 5          single largest commitment to public 

 6          housing -- to affordable housing that has 

 7          ever been made in the history of the state 

 8          over a long period of time, $20 billion, 

 9          $2.5 billion now for five years in capital 

10          subsidy, it's enormous -- it doesn't come 

11          close to meeting the affordable housing 

12          crisis needs across the state that pop up in 

13          every possible form.  

14                 You know, we talked about rural 

15          housing, we talked about mobile housing, 

16          we've talked about homeownership issues, 

17          which I'm sure somebody will bring up later, 

18          which we'll be delighted to talk about.  This 

19          state has an affordable housing crisis, and 

20          it manifests itself every day in all kinds of 

21          different ways, not just in public housing in 

22          New York City.  There is a -- I agree with 

23          you, a tremendous need and a very, very high 

24          visibility, very highly visible because of 


 1          where it is and the depth of the need and the 

 2          long-term -- the long -- the duration of 

 3          which -- you know, the failure, I would say, 

 4          of the world to fix it adequately, but it's 

 5          not the only need.  

 6                 And what we're doing in this budget, 

 7          we think, is contributing to a solution as 

 8          well as we also have a deep commitment to 

 9          finding other ways outside of the budget -- 

10          for example, our commitment to tax-exempt 

11          resources -- to make even bigger impacts on 

12          NYCHA's needs.  That's what I would say -- 

13          that's the signal.

14                 CHAIRMAN FARRELL:  Thank you.

15                 COMMISSIONER RUBIN:  Thank you.  

16                 CHAIRWOMAN YOUNG:  Thank you.  

17                 Our next speaker is Senator 

18          Montgomery.

19                 SENATOR MONTGOMERY:  Thank you, 

20          Madam Chair.

21                 Good morning.

22                 COMMISSIONER RUBIN:  Good morning, 

23          ma'am.

24                 SENATOR MONTGOMERY:  And I must say 


 1          that -- I have to give a shout-out to someone 

 2          who's on your staff who would have been 

 3          sitting here were she not stolen by you, 

 4          Senator -- former Senator Hassell-Thompson.  

 5          So welcome, Senator.  Sorry you're not here, 

 6          but glad you're there.  I forgive you.  

 7                 (Laughter.)

 8                 SENATOR MONTGOMERY:  Let me just try 

 9          to go through a couple of the issues that I 

10          want to raise with you before my time runs 

11          out, because you don't have a time limit but 

12          I do.

13                 So first of all, you know that my 

14          district -- I don't know if you do know my 

15          district.

16                 COMMISSIONER RUBIN:  I do.

17                 SENATOR MONTGOMERY:  You do.  And 

18          we're the epicenter of gentrification, in a 

19          very large sense.  So the issue of housing, 

20          affordable housing, is severe.  And we also 

21          have, along with that, an issue of supportive 

22          affordable housing.  So my questions are 

23          related to the supportive housing area that 

24          you plan in particular.  


 1                 Can you give us an idea of how many 

 2          units you intend to bring on, currently and 

 3          in the next year or so, of supportive housing 

 4          in New York City in particular?  And in -- 

 5          well, in the city, but certainly in areas 

 6          like mine, like I represent.

 7                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 8          Sure.  So the Governor laid out last January 

 9          a commitment of 6,000 units of supportive 

10          housing over the next five years.  We are 

11          thrilled to say that we have awarded funds 

12          for the first 1200, so the first year's 

13          commitment against that 6,000, making us sort 

14          of on time and on target for that.  

15                 And we have behind that a robust 

16          pipeline of supportive housing units that we 

17          will continue over the course of the next 

18          years to meet that 6,000-unit goal.  

19                 In terms of the split, we would 

20          suspect that the -- you know, the -- our 

21          development tracks the demand.  The majority 

22          of the demand is in New York City, although 

23          there certainly is supportive housing need 

24          upstate as well.  So we would expect the 


 1          majority of the 1200 each year to be in 

 2          New York City.  But we have a -- as I said, 

 3          we have a very -- there's a great need 

 4          upstate too, and we have a lot of wonderful 

 5          nonprofit and for-profit partners who develop 

 6          that housing across the state.

 7                 SENATOR MONTGOMERY:  And will the 

 8          majority of that be done by the 

 9          not-for-profit community in particular?

10                 EX. DEP. COMMISSIONER VISNAUSKAS:  

11          Traditionally, the not-for-profit community 

12          has been sort of the leader in developing 

13          supportive housing.  We also have some 

14          partners who are for-profits who are very 

15          strong who sometimes develop on their own.  

16          Oftentimes they're partnering with 

17          nonprofits, who may prefer to just provide 

18          services and don't necessarily want to own 

19          and operate real estate.  

20                 So it's a mix, but I think you'll find 

21          that the majority of the -- historically, the 

22          majority of the development of supportive 

23          housing has been nonprofit-driven.

24                 SENATOR MONTGOMERY:  I'm glad to hear 


 1          that.  And hopefully that will continue.

 2                 With regard to two other issues that I 

 3          want to raise with you, I don't know if 

 4          you're familiar with the Northwell report, 

 5          which is really related to a healthcare 

 6          delivery system and improving that in north 

 7          Brooklyn.  But part of that -- their report 

 8          and their recommendations have to do with 

 9          housing as well.  And so I've asked the 

10          former -- I think the OMH commissioner the 

11          same question, and I'm asking you, to what 

12          extent you're planning to coordinate your 

13          efforts and your plans with OMH, OPWDD, 

14          Health, to make sure that their plan is 

15          complementary to whatever you're planning, 

16          especially as it relates to supportive 

17          housing.  Because that's apparently what -- 

18          mostly what they will be doing.

19                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

20          did read the Northwell report, although I 

21          only actually read the sections that related 

22          to housing, not the sections that related to 

23          health and -- it was a very long, extensive 

24          report.


 1                 I'm happy to say we are working very 

 2          closely on an interagency task force around 

 3          housing, related to the Northwell report and 

 4          the hospital transformation in central 

 5          Brooklyn.  So we're very well coordinated.  

 6          And where there's housing opportunities, we 

 7          will jump right into those and provide the 

 8          appropriate mix and type of housing that's 

 9          suitable, depending on the different 

10          locations.

11                 SENATOR MONTGOMERY:  So I want to take 

12          this opportunity to invite you to my district 

13          so that you can see some of the projects that 

14          you've done in prior years and how it works.  

15          And of course the not-for-profit housing 

16          communities have an extremely difficult 

17          problem trying to coordinate different 

18          agencies' requirements and timelines and 

19          regulations, et cetera.  So that's going to 

20          be very, very important when it comes to 

21          utilizing your agency as a lead agency in 

22          helping us to develop that housing.  So 

23          hopefully that can happen.

24                 Just one last question on NYCHA.  Now, 


 1          the last time that we did $100 million for 

 2          NYCHA that the state allocated, I consider 

 3          that having been sprinkled like confetti.  So 

 4          I want to hear from you what of that 

 5          $100 million was used for structural 

 6          improvements.  Because I represent -- for 

 7          instance, one of the communities that I 

 8          represent is Red Hook, and the damage from 

 9          the floods were extensive.  But also, just 

10          generally speaking, the projects in my 

11          district are in great disrepair, as other 

12          Senators have pointed out.  

13                 And so I'm just curious about, one, 

14          what happened to the $100 million, where it 

15          went, what did it do to help improve the 

16          situation, the structural situations?  And 

17          what are your plans for the next $100 million 

18          as it relates to addressing the needs 

19          structurally and not cosmetically only?  

20                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

21          can take a piece of that and Jamie can fill 

22          in what I miss.  

23                 On the first 100, 50 million that has 

24          gone to DASNY of the first 100 is for 


 1          projects that are underway.  And the 

 2          anticipation is that those projects will be 

 3          completed within the year.  I don't have a 

 4          list with me of what those actual projects 

 5          are, but we would be happy to get that 

 6          information to you.

 7                 SENATOR MONTGOMERY:   I would like to 

 8          see that.  I would like that.

 9                 EX. DEP. COMMISSIONER VISNAUSKAS:  In 

10          terms of the second hundred, there is no 

11          predetermined notion yet as to what that 

12          funding would go towards.  I think that's 

13          still open to conversation.  And to the 

14          extent that it's important to let it be for 

15          structural purposes in your community, I 

16          think we'd be happy to have that 

17          conversation.

18                 SENATOR MONTGOMERY:  Well, I've spent 

19          so much time with the NYCHA administration, 

20          and they were as shocked as I was to see that 

21          we were not putting the major part of that 

22          funding on absolutely structural repair 

23          needs.  And so I'm hopeful that this will be 

24          very different as we move forward.  You talk 


 1          about preserving 50,000 units.  Obviously, 

 2          NYCHA is the largest stock of absolutely 

 3          affordable housing, so we really need to and 

 4          have to pay special attention to it.  So I 

 5          thank you for that.

 6                 And with that, I return my time.

 7                 CHAIRWOMAN YOUNG:  Thank you, Senator.  

 8                 Mr. Chairman?  

 9                 CHAIRMAN FARRELL:  Thank you.  

10                 Mr. Mosley.

11                 ASSEMBLYMAN MOSLEY:  Thank you, 

12          Mr. Chair.  

13                 Just two quick follow-up questions.  

14          In regards to the 2016 numbers that you 

15          talked about in your testimony, Mr. Chair, do 

16          you actually know the number that you created 

17          and preserved in percentages, in terms of the 

18          AMI levels of what you created and what you 

19          preserved in 2016?  

20                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

21          don't have that in my head, but we can 

22          certainly follow up -- I'll follow up with 

23          you on that.

24                 ASSEMBLYMAN MOSLEY:  And then in lieu 


 1          of the new proposal you have for Affordable 

 2          New York and the next five years, the number 

 3          of additional affordable housing units, and 

 4          in lieu of what Senator Young noted in terms 

 5          of staffing ratios, will TPU be expanded in 

 6          an effort to anticipate that growth in 

 7          housing stock throughout New York State?

 8                 COMMISSIONER RUBIN:  That's a great 

 9          question.  

10                 We have no plans to expand TPU 

11          staffing at the moment.  As I think RuthAnne 

12          said earlier, the funding request in this 

13          year's budget is equal to funding for TPU in 

14          past years.  

15                 Look, the need is obviously very, very 

16          high.  Because of the magnitude of the number 

17          of apartments that we oversee -- 900,000 or 

18          so rent-stabilized apartments throughout 

19          New York City that we're responsible for -- 

20          we could, you know, quadruple the size of any 

21          of our pieces of our agency and still not 

22          have enough people, in theory. 

23                 On the other hand, we work very, very 

24          smart, we work very, very efficiently.  TPU, 


 1          just like the rest of the agency, does a 

 2          tremendous volume of work with very, very few 

 3          people.  They leverage themselves.  So, you 

 4          know, saying that TPU has X number of people, 

 5          $4.5 million, is sort of deceptive, because 

 6          TPU is part of, for example, a task force 

 7          that includes other agencies from New York 

 8          City, the AG's office and others, with whom 

 9          they work in close partnership all the time.  

10          And so they multiply their effort many, many 

11          times to do their work.  

12                 And then of course there's the rest of 

13          our agency -- ORA, the Office of Rent 

14          Administration, in particular, which is on 

15          point to the day-to-day responsibilities of 

16          overseeing the rent-stabilized portfolio.  

17          They have their own investigative unit, which 

18          is not duplicative.  It works in somewhat 

19          different ways.  And then they do other work 

20          that ends up often with positive outcomes, if 

21          appropriate, for tenants of all kinds.  

22                 So, you know, the work -- rather than 

23          saying TPU should be larger or smaller or 

24          whatever, it's really the outcomes that we're 


 1          focusing on.

 2                 ASSEMBLYMAN MOSLEY:  Right.  And 

 3          that's why I wanted -- because I know you 

 4          want to talk about -- it's your manpower, and 

 5          obviously with technology and innovation we 

 6          can always find ways to do our job more 

 7          efficiently.  

 8                 So I think we alluded to this last 

 9          year during the joint budget hearing, that we 

10          need to find better ways to do our job more 

11          efficiently.  And it doesn't necessarily mean 

12          expanding your units.  I mean, we have all 

13          the tools available to us.  I think that we 

14          should be looking in a more innovative way in 

15          terms of how we can make TPU more efficient.  

16          It just doesn't mean just adding manpower.

17                 So the last question I have, 

18          Mitchell-Lama -- I know a couple of my 

19          colleagues had alluded to some of the 

20          questions.  Have we created any new incentive 

21          programs to keep Mitchell-Lama programs in 

22          the program?  I know that there seems to be, 

23          given the marketplace -- and I overlap 

24          Senator Montgomery's district, where we are 


 1          the epicenter of the epicenter.  

 2                 Are there any other new plans in the 

 3          future in terms of creating further 

 4          incentives for people to stay in the program?  

 5          We're talking about preserving real 

 6          affordable and decent housing for 

 7          working-class and middle-class men and women.

 8                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

 9          would say a couple of things.  One, as part 

10          of the $2 billion housing plan, we are 

11          continuing funding for outside of just the 

12          UDC portfolio for all the other 

13          Mitchell-Lamas to have financing tools that's 

14          attractive to owners who would come in and 

15          utilize our financing tools to preserve their 

16          building and make that a smart economic 

17          choice for them.  So I think having those 

18          funds in the budget is critical to that.  

19                 And I think, secondary to that, we 

20          would be happy to sit down and think about 

21          strategies that might be relevant to the 

22          specific Mitchell-Lamas in your district that 

23          we need to get a little more creative, a 

24          little more thoughtful about.


 1                 ASSEMBLYMAN MOSLEY:  That is -- I know 

 2          the Comptroller issued a report in terms of 

 3          land-banking of New York City.  Obviously 

 4          New York City has the discretion to not be 

 5          land-banked.  We have a number of vacant lots 

 6          throughout the five boroughs.  Obviously 

 7          there's a discrepancy between the city and 

 8          what the Comptroller is reporting.  

 9                 But if we can do something in terms of 

10          creating a new paradigm in terms of making 

11          some amendments to the current rules and 

12          regulations as relates to land-banking, in an 

13          effort for us to utilize those open lots so 

14          that we can create real affordable housing, 

15          100 percent affordable housing, I would 

16          greatly appreciate that conversation going 

17          forward.

18                 EX. DEP. COMMISSIONER VISNAUSKAS:  

19          We'd be happy to work on that with you.

20                 ASSEMBLYMAN MOSLEY:  Thank you, 

21          soon-to-be-Commissioner.

22                 CHAIRMAN FARRELL:  Thank you.  

23                 CHAIRWOMAN YOUNG:  Thank you.  

24                 I'm up again, so thank you for your 


 1          passion, Jamie, for upstate rural housing and 

 2          addressing those needs.  And I kind of wanted 

 3          to follow up on that.  

 4                 As you know, there are affordable 

 5          housing programs that benefit upstate, 

 6          there's the Rural Rental Assistance Program, 

 7          there's some Mitchell-Lama, we have our Rural 

 8          Preservation and our Neighborhood 

 9          Preservation Companies.  We have HUD, 

10          Section 8 for low-income, 202 for seniors, we 

11          have USDA, we have low-income tax credits and 

12          so on.  We have the CIF, which is 

13          particularly near and dear to my heart 

14          because that's the rural and urban fund.  

15                 But as you know, the vast majority of 

16          our affordable housing upstate is in the form 

17          of manufactured housing or mobile homes.  And 

18          over the years I've dealt with many issues 

19          related to mobile homes and mobile home 

20          parks.  I've walked into a trailer -- 

21          60-year-old trailer, 80-year-old woman living 

22          there -- it's rusted out, ceiling caving in.  

23          We've had problems with black mold, we've had 

24          issues with failed septic systems and raw 


 1          sewage actually surrounding the homes in a 

 2          mobile home park.  We've had issues with 

 3          landlords that have doubled the assessment on 

 4          a trailer or mobile home so that they could 

 5          collect more taxes and keep it themselves.  

 6          So we've had a lot of issues over the years.  

 7                 And as you know, HCR has the 

 8          responsibility for ensuring compliance of 

 9          mobile home parks under the Real Property 

10          Law.  So I had a few questions about that.  

11                 What efforts do you undertake to 

12          educate and protect the rights of residents 

13          in these parks?  

14                 EX. DEP. COMMISSIONER VISNAUSKAS:  So 

15          I can speak about a couple of those things.  

16                 I'm happy to say that we recently, 

17          under the leadership of now not acting, our 

18          general counsel, Linda Manley, have taken 

19          steps to actually do a little better 

20          coordination internally.  As you mentioned, 

21          HCR has oversight of licensing.  We also 

22          grant and provide funding for more mobile 

23          homes and manufactured homes.  I'd be happy 

24          to talk about our pilot program that we 


 1          launched last year on that.  And there's also 

 2          been some legislation at the federal level 

 3          around financing for individual homeowners of 

 4          manufactured and mobile homes.  

 5                 So under Linda's leadership, we're 

 6          looking to combine our what had been somewhat 

 7          disparate forces internally to make sure that 

 8          we have a really comprehensive approach to 

 9          manufactured and mobile home parks across the 

10          state.  It's obviously a critical, critical 

11          resource for housing for so many people.  

12                 And if I might for a minute just talk 

13          about the pilot program that we launched last 

14          year, which we were really thrilled to 

15          receive funding for.  Under Senator Little's 

16          leadership, we received $2 million to launch 

17          the pilot program.  We received $6 million 

18          worth of applications against the $2 million, 

19          and we will be announcing those in April and 

20          look to roll out that program more 

21          consistently.  It is in our $2.5 billion 

22          budget proposal to make it a five-year 

23          program so that we can give people the 

24          ability to come in year after year -- 


 1          additional people to come in each year and 

 2          take advantage of it.  

 3                 So we are sort of taking a new, fresh, 

 4          hopefully improved and more coordinated 

 5          approach to making sure that we address the 

 6          needs of the mobile and manufactured home 

 7          communities across the state.

 8                 CHAIRWOMAN YOUNG:  We're very excited 

 9          about that program too, so that's great to 

10          hear.  We would like to see it expanded.  

11                 But back to the mobile home parks, how 

12          many staff do you have within HCR that are 

13          devoted to that effort of compliance and 

14          enforcement?  

15                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

16          don't know the exact staffing number, but I'd 

17          be happy to get back to you with that.

18                 CHAIRWOMAN YOUNG:  That would be 

19          great.  Now, as you know, under the Real 

20          Property Law the agency has the ability to 

21          bring court actions on enforcement.  Do you 

22          know how many court actions have been brought 

23          over the past like, say, seven years?  

24                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 


 1          can get you that number as well.  I don't 

 2          have it with me, but I can get that.

 3                 CHAIRWOMAN YOUNG:  And I'd also like 

 4          to see how much has been collected in fines 

 5          and penalties and what HCR has actually done 

 6          with those resources.  That would be helpful 

 7          to know.

 8                 But would you characterize it as, you 

 9          know, you're responsive, that you're kind of 

10          reactive to different complaints that are 

11          brought?  Is that how the system works?

12                 EX. DEP. COMMISSIONER VISNAUSKAS:  We, 

13          I would say, have probably traditionally been 

14          responsive.  But to the extent that in the 

15          last couple of months we have sort of pulled 

16          together this more comprehensive approach, I 

17          think it would probably give us the 

18          opportunity to be more proactive.  And I 

19          think we would be thrilled to sort of pull 

20          sort of all the questions that you just 

21          asked, pull together all the answers and come  

22          sit and have a sort of comprehensive 

23          discussion on that.  We would appreciate that 

24          opportunity.  


 1                 CHAIRWOMAN YOUNG:  So it hasn't really 

 2          been a proactive system, though; right?  

 3                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

 4          don't know that I can speak to it so well to 

 5          answer that.  So we will get that answer to 

 6          you.  But suffice to say we will.

 7                 CHAIRWOMAN YOUNG:  Because sometimes, 

 8          you know -- and some of these issues cross 

 9          over to the local departments of health.  You 

10          know, for example, the raw sewage, I think it 

11          would be both.  But I think that it's been a 

12          more reactive system.  And I know that you 

13          have a proactive system with the TPU in 

14          New York City.  So it just seems like there's 

15          unequal treatment and protection for tenants 

16          across the state, so I just wanted to point 

17          that out.

18                 Just switching gears to the 

19          Neighborhood and Rural Preservation 

20          Companies, I had just a couple of questions.  

21          Thankfully we don't have to fight over the 

22          funding this year, which is good.  But have 

23          any new Neighborhood or Rural Preservation 

24          Companies been created in the last three 


 1          years?

 2                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 3          Been created?

 4                 CHAIRWOMAN YOUNG:  Created, yeah.

 5                 COMMISSIONER RUBIN:  Or put into the 

 6          program, funded with the program.

 7                 CHAIRWOMAN YOUNG:  Right.

 8                 COMMISSIONER RUBIN:  We would have to 

 9          come back to you about that.  I think that 

10          there have been -- I think we put a few new 

11          through with last year's -- remember, you all 

12          increased the funding for the program a 

13          couple of years ago with the settlement 

14          money, and I think we were able to add some 

15          new programs in at that time, sometimes to 

16          replace -- as you know, there were some 

17          programs that went out of --

18                 CHAIRWOMAN YOUNG:  I know I saddle you 

19          with a laundry list at these hearings, but if 

20          you could get me that information, that would 

21          be helpful.

22                 COMMISSIONER RUBIN:  Absolutely.  No 

23          problem.

24                 CHAIRWOMAN YOUNG:  And have there been 


 1          any mergers or have any mergers been 

 2          requested of NPCs or RPCs?  Because there was 

 3          a discussion over the past several years 

 4          about mergers.  So I was curious about that, 

 5          anything you --

 6                 COMMISSIONER RUBIN:  Again, we'll come 

 7          back to you with an answer on that.

 8                 As you know, mergers between 

 9          agencies -- any kind of merger is always 

10          complicated, difficult to pull off.  But that 

11          was one of the goals, I think, of some of the 

12          additional funding.  There was an additional, 

13          I think, million dollars or so that was in 

14          place to try to facilitate that, so we'll 

15          find out.

16                 CHAIRWOMAN YOUNG:  It would be helpful 

17          to have any information on the disbursement 

18          of grants, so that would be great.

19                 COMMISSIONER RUBIN:  Absolutely.

20                 CHAIRWOMAN YOUNG:  I know that HCR 

21          gets revenue from a variety of sources, but 

22          part of that includes fees.  And could you 

23          give a breakdown of fees that you collect and 

24          the revenues generated?  Do you know those 


 1          off the top of your head?  Because I have a 

 2          list, but --

 3                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

 4          don't know them off the top of my head, no.

 5                 COMMISSIONER RUBIN:  Neither one of us 

 6          knows.

 7                 CHAIRWOMAN YOUNG:  All right.  So what 

 8          I'm talking about, just to be a little bit 

 9          clearer, so you have mortgage servicing fees, 

10          correct?  You have application and monitoring 

11          fees collected from developers of housing 

12          projects, right?  You have payments by 

13          New York City to finance a portion of the  

14          division's rent-regulation activities.  And 

15          you have administrative fees collected from 

16          HUD in connection with the state's 

17          administration of the federal Section 8 

18          rental subsidy program.  So those are all 

19          fees that HCR collects.  

20                 And part of them -- you know, so some 

21          are existing and then you have these 

22          opportunities now, with this proposal for the 

23          $2 billion in capital funding and capital 

24          projects down the road, and there are fees 


 1          that are associated with those projects that 

 2          HCR will be collecting.

 3                 So I had a question about how much in 

 4          fees do you anticipate, and what do you do 

 5          with the fees once you get those?  Because 

 6          with these new projects especially, there's 

 7          going to be a real infusion of new revenue to 

 8          HCR.  Do you have any estimate or any kind of 

 9          details on that?

10                 EX. DEP. COMMISSIONER VISNAUSKAS:  We 

11          can follow up with you with more specifics on 

12          that.  

13                 I think I would say generally where 

14          there are excess revenue that's within -- 

15          sort of within HFA as a result of collecting 

16          some of the fees that you mentioned, the 

17          majority of that goes back out as subsidy 

18          into deals.  So it's -- you know, it goes 

19          back to the same purpose as the rest of the 

20          agency is here to serve.

21                 But we'd be happy to follow up with 

22          you on specific fees.

23                 COMMISSIONER RUBIN:  If I could add 

24          just one -- that's exactly right.  I would 


 1          add one other comment, which is that, you 

 2          know, one of the other things that we do 

 3          with -- call it excess revenue, whatever you 

 4          want to call it, is try to maintain our 

 5          interest rates, whether in a single-family 

 6          program or a multifamily program, at levels 

 7          that facilitate the development of truly 

 8          affordable housing.  

 9                 And we're only able to do that because 

10          we have not only capital funding every year 

11          and operating funding, but also other revenue 

12          from other sources.  And we're able to help 

13          pump additional subsidy, in effect, which 

14          is -- you could think of as being a forgone 

15          fee, effectively, so.

16                 CHAIRWOMAN YOUNG:  Is there any kind 

17          of difference between the application and 

18          monitoring fees for developers of huge 

19          projects and small projects?  It's all the 

20          same amount; right?

21                 COMMISSIONER RUBIN:  I think it's 

22          largely the same.  I don't think we change it 

23          on the basis of -- we will have to come back 

24          to you, I'm sorry.  


 1                 CHAIRWOMAN YOUNG:  I believe it is the 

 2          same, like a $5,000 fee, for example, for a 

 3          developer.

 4                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 5          Mm-hmm.  Right.

 6                 CHAIRWOMAN YOUNG:  But that's for 

 7          these enormous projects that we see, and it's 

 8          also for some of the smaller projects 

 9          upstate.  Has the agency ever considered 

10          maybe doing a sliding scale or something like 

11          that?  Just because sometimes it's very 

12          difficult for a small guy to be able to 

13          afford all of the fees associated with a 

14          project, and it may preclude them from moving 

15          forward in some cases.

16                 EX. DEP. COMMISSIONER VISNAUSKAS:  

17          We'd be happy to look at that a little 

18          closer.

19                 CHAIRWOMAN YOUNG:  That would be 

20          great.  

21                 I wanted to ask about the value of the 

22          tax credits.  And as you know, there are a 

23          lot of things going on in Washington right 

24          now and the speculation alone about 


 1          whether -- yes, the low-income tax credits.  

 2          Yes, thank you for clarifying.  But there's a 

 3          lot of speculation with the low-income tax 

 4          credits.  And actually right now it's driving 

 5          the value of the tax credits down.  And I 

 6          guess one of the questions I had was, what is 

 7          the state's strategy for managing potential 

 8          variations in the tax credit pricing?  

 9          Because we know that those tax credits are 

10          critically important to developing affordable 

11          housing.

12                 EX. DEP. COMMISSIONER VISNAUSKAS:  

13          It's a great question.  It's an issue that is 

14          of great concern to us and which we talk 

15          about very often.  In fact, we pull together 

16          our partners in this industry and the banks, 

17          the syndicators, the developers, and talk 

18          about what people are seeing in the market, 

19          what we might see in the next three months, 

20          what we might see in the next nine months, 

21          when people expect tax reform, where they 

22          expect it's going to land.  

23                 As you know, it's all speculation to 

24          date and we're trying to sort of gauge the 


 1          right way to act in an uncertain market.  We 

 2          know that the pricing will go down, and we 

 3          are working with our partners to find ways to 

 4          absorb that, what will basically create gaps 

 5          in our projects, whether that would be 

 6          capital from the state or other resources 

 7          that we might bring to bear into the 

 8          projects.  

 9                 But it certainly will be a challenging 

10          time for us as we go forward, and we're very 

11          cognizant of that.

12                 COMMISSIONER RUBIN:  You know, just to 

13          add to that, to make the obvious point, the 

14          fact that, as you obviously are aware, 

15          fluctuations in the tax credit pricing leave 

16          potential gaps in projects, and sometime 

17          those gaps are quite large, millions of 

18          dollars --

19                 CHAIRWOMAN YOUNG:  Is the state going 

20          to finance that if there are --

21                 COMMISSIONER RUBIN:  I'm sorry?

22                 CHAIRWOMAN YOUNG:  Would the state 

23          finance gaps, Jamie, or how would that work?  

24                 COMMISSIONER RUBIN:  Well, what we do 


 1          is we work with developers to try and either 

 2          find alternative sources or push them, 

 3          frankly, to what they call a value engineer, 

 4          which is basically to cut their costs.  But 

 5          in the end, if there's a gap, the state is 

 6          committed to developing affordable housing, 

 7          and we will step in with subsidy.  But it 

 8          highlights the importance of the budget 

 9          proposal that we're all here to talk about, 

10          which is the need for capital subsidy is only 

11          going up because of, among other things, the 

12          fluctuation, the downward movement in tax 

13          credit pricing, which I don't see any change 

14          in for a while.

15                 CHAIRWOMAN YOUNG:  Something we'll 

16          have to keep an eye on, for sure.

17                 COMMISSIONER RUBIN:  Exactly, Senator.

18                 CHAIRWOMAN YOUNG:  Just with senior 

19          housing, when you're doing the scoring on 

20          affordable housing projects, it seems to me 

21          that senior housing is in the same pool as 

22          multifamily housing; is that correct?  

23                 EX. DEP. COMMISSIONER VISNAUSKAS:  

24          Yeah, we've not had a dedicated program for 


 1          senior housing, although we are proposing 

 2          that in the current budget you have before 

 3          you.

 4                 CHAIRWOMAN YOUNG:  That would be 

 5          great.  Because right now what happens, it 

 6          seems to me that there's a scoring process 

 7          where multifamily -- there's a real focus on 

 8          multifamily housing, and they automatically 

 9          get five extra points.  And what that has 

10          done is maybe reduced the number of senior 

11          housing projects.  But we know that the 

12          population of seniors is exploding.  I have a 

13          figure here, the Social Security 

14          Administration estimates that 10,000 

15          Americans are turning 65 every day.  And I'm 

16          not there yet but, you know, it's going to 

17          happen sometime in the near future.  

18                 So I'd like to know more about the 

19          senior housing that you plan in the budget, 

20          because I think that's really crucial to a 

21          lot of New Yorkers.  And have you considered 

22          reviewing your regulatory and scoring 

23          documents to address the need for senior 

24          housing?  Or do you think that your new 


 1          program will address those issues?  

 2                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

 3          mean, our thought had been that once we have 

 4          sort of a dedicated resource that would sort 

 5          of thematically, right, would give sort of a 

 6          five-year consistent source of funding for 

 7          developers of senior housing to know they can 

 8          come back year to year and access that 

 9          subsidy, would sort of provide the industry 

10          what it needs.

11                 CHAIRWOMAN YOUNG:  Thank you.

12                 I'll come back.  I have a couple more 

13          questions.

14                 CHAIRMAN FARRELL:  Thank you.  

15                 You know, 43 years ago I was elected, 

16          and one of the reasons I was elected was 

17          because of the housing in my neighborhood.  

18          And they were -- the Bronx, as you 

19          remember -- no, you weren't even born.

20                 COMMISSIONER RUBIN:  No, no.  Yes, we 

21          were there.

22                 EX. DEP. COMMISSIONER VISNAUSKAS:  

23          Just.

24                 COMMISSIONER RUBIN:  Just.


 1                 (Laughter.)

 2                 CHAIRMAN FARRELL:  Houses were being 

 3          abandoned, landlords were walking away from 

 4          projects.  And I worked with some other young 

 5          men -- at the time I was young -- and we did 

 6          a lot of working, and then we found out that 

 7          there was a problem.  The landlords had 

 8          agents, the people didn't.  And I said, you 

 9          know, maybe we can put together a program 

10          that will give them agents to defend 

11          themselves against the landlord.  

12                 And that's how the Neighborhood 

13          Preservation Program became what it is today.  

14          Because three years in, I realized I was 

15          spending more time in the city than up here 

16          in Albany because of the work.  And we put 

17          this program together, and the governor then 

18          approved it, and it's grown to where it is.  

19                 I've been very happy to see the things 

20          that have happened.  And then you went to the 

21          rural program, which made it statewide, which 

22          is functioning.  But I see here it appears 

23          that $700,000 have been cut out of the 

24          program this year.  Is there a reason for 


 1          that?  And am I right on the numbers?

 2                 EX. DEP. COMMISSIONER VISNAUSKAS:  The 

 3          number I believe for this year is that 

 4          there's about $18 million in the budget, 

 5          thanks to the JPMorgan settlement dollars 

 6          that's --

 7                 CHAIRMAN FARRELL:  It's 18.2 million.  

 8          But it's still 700,000 short.

 9                 EX. DEP. COMMISSIONER VISNAUSKAS:  

10          Yeah, I'd have to get back to you on the 

11          700,000, on the nature of that reduction.

12                 CHAIRMAN FARRELL:  It would have been 

13          nicer if it was in.

14                 EX. DEP. COMMISSIONER VISNAUSKAS:  

15          Understood.

16                 CHAIRMAN FARRELL:  All right.  Thank 

17          you.

18                 Let's see.  We've been joined by 

19          Assemblywoman Carmen De La Rosa.  

20                 And to close on our side, Assemblyman 

21          Kavanagh.

22                 ASSEMBLYMAN KAVANAGH:  So I guess I'm 

23          the only thing between you and your departure 

24          after several hours.  Just a couple of quick 


 1          questions to follow up.  

 2                 First of all, toward the end of your 

 3          comments when we were discussing this before, 

 4          you said that you would prefer to do 

 5          approaches like the RAD program that you did 

 6          quite successfully, jointly with NYCHA and 

 7          other agencies.  You're not asserting that 

 8          RAD is a substitute for a robust, substantial 

 9          capital budget for NYCHA; right?  

10                 COMMISSIONER RUBIN:  Absolutely not.  

11                 ASSEMBLYMAN KAVANAGH:  Okay.  So they 

12          need the kind of capital funding that they 

13          can direct to modest repairs, major repairs 

14          in buildings across their portfolio; right?

15                 COMMISSIONER RUBIN:  For sure.  And 

16          that's what they've advocated for in front of 

17          New York City's government, I think -- 

18                 ASSEMBLYMAN KAVANAGH:  Okay.  And you 

19          said that the state -- you acknowledge the 

20          state has some responsibility for NYCHA, and 

21          you think that the $100 million that we've 

22          given to DASNY expresses that, the 

23          Executive's commitment to NYCHA.

24                 COMMISSIONER RUBIN:  I would put it a 


 1          different way.  I would say that the Governor 

 2          recognizes that NYCHA has tremendous needs 

 3          and decided as a result of that to allocate a 

 4          certain amount of money to NYCHA for capital.

 5                 ASSEMBLYMAN KAVANAGH:  Does the state, 

 6          which created the New York City Housing 

 7          Authority by statute and has 2 to 3 percent 

 8          of the entire state population living there, 

 9          have some obligation to ensure that these 

10          buildings meet minimal standards of decency 

11          that Senator Savino was talking about?  

12                 COMMISSIONER RUBIN:  So, Assemblyman, 

13          you know better than I, I'm sure, that the 

14          responsibility, financial and otherwise, 

15          regulatory, for NYCHA has gone through a 

16          number of changes over the last number of 

17          years, most recently as a result of the ARRA, 

18          the federal stimulus program that was put in 

19          place by President Obama.  

20                 You know, the state does not have an 

21          actual responsibility to provide funding to 

22          NYCHA anymore, and there's a reason for that, 

23          because of the changes that it's gone 

24          through.  I'm not suggesting that NYCHA is 


 1          adequately funded, because I think we would 

 2          all agree that --

 3                 ASSEMBLYMAN KAVANAGH:  I'm not asking 

 4          whether you have a legal responsibility.  We 

 5          don't have a legal responsibility to provide, 

 6          you know, any number of services we provide 

 7          to the general public.

 8                 COMMISSIONER RUBIN:  I would separate 

 9          out -- we can -- perhaps we can talk -- I can 

10          come back to you with a legal response as to 

11          the state's oversight responsibilities, 

12          because we have -- I mean, the state as a 

13          whole has responsibilities that go well 

14          beyond housing.  But with respect 

15          specifically to the area that I'm here to 

16          talk about, housing funding, we don't have 

17          any housing funding responsibility to NYCHA.

18                 ASSEMBLYMAN KAVANAGH:  Again, I'm -- 

19          there's a transcript of this hearing that we 

20          can all look at.  I believe you said before 

21          that the Governor recognizes he has a 

22          responsibility for NYCHA and that's why we 

23          put $100 million in.  You know, but we'll -- 

24          we can leave it there for now.


 1                 COMMISSIONER RUBIN:  Okay.  Well, I am 

 2          now restating that to say that the Governor 

 3          recognizes that there is a need for NYCHA, 

 4          that NYCHA has extensive capital needs, and 

 5          that in this year's budget and two years 

 6          ago's budget he attempted to make a 

 7          contribution to those capital needs, both 

 8          through the capital and then through the RAD 

 9          program that we executed earlier last year.

10                 ASSEMBLYMAN KAVANAGH:  And just -- we 

11          danced around the issue of who should be 

12          doing this money.  I don't think we dealt 

13          with this directly.  But the current NYCHA 

14          proposal from the Executive includes a 

15          provision that would require previously 

16          appropriated NYCHA funds to be fully 

17          obligated before the new appropriation can be 

18          obligated, the new $100 million you're 

19          speaking about.  

20                 Is there any other program in the 

21          Governor's proposal that has that kind of 

22          requirement that the last $100 million be 

23          fully obligated before anybody can touch the 

24          new $100 million?


 1                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 2          We'd have to check on that.  I'm not sure.

 3                 ASSEMBLYMAN KAVANAGH:  Do you 

 4          acknowledge that that's the -- that I'm 

 5          accurately stating the provision with respect 

 6          to NYCHA?  

 7                 COMMISSIONER RUBIN:  I don't have the 

 8          legislative language in front of me, 

 9          Assemblyman, but I assume that it is correct.

10                 ASSEMBLYMAN KAVANAGH:  Okay.  So 

11          again, we would -- I'd like to follow up on 

12          that.  If there's any other program on which 

13          your -- would you agree that that's an 

14          unusual requirement in a capital budget for 

15          housing?  

16                 COMMISSIONER RUBIN:  Not necessarily.  

17          I would agree that it -- we will come back to 

18          you as to whether there are any other 

19          programs within our ambit that have the same 

20          requirement.  And that's as far as I would 

21          go.

22                 ASSEMBLYMAN KAVANAGH:  Can you -- can 

23          you -- you've had a lot of experience with 

24          this over the years.  You're telling me 


 1          you're not -- it's not -- it would not be -- 

 2          you would not consider it unusual to have 

 3          that kind of requirement in a capital budget, 

 4          that the last capital budget be fully spent 

 5          before you touch the new capital dollars?

 6                 COMMISSIONER RUBIN:  I really -- 

 7          without understanding whether we have any 

 8          other -- because my answer would change 

 9          completely if there were other programs 

10          within our ambit --

11                 ASSEMBLYMAN KAVANAGH:  I'm not asking 

12          prospectively or about programs that you're 

13          not aware of.  I'm asking in your experience, 

14          with lots of experience with capital budgets 

15          for housing and other things, is this 

16          something that you're aware you've done with 

17          capital budgets in the past?  

18                 COMMISSIONER RUBIN:  Let me say it 

19          differently.  Capital programs have different 

20          requirements based on what they're intended 

21          to do, what the capital goes to.  They are 

22          not cookie cutter.  They don't all look the 

23          same.  They have different requirements.  

24          Some -- as you know, some are -- you know, 


 1          have design-build requirement -- this 

 2          is not -- again, this is outside of my ambit.  

 3          I'm just telling you, outside of, you know, 

 4          some have design-build capabilities, some 

 5          don't.  You know, if you could stamp out a 

 6          capital program design that was the same for 

 7          the entire state for every agency and every 

 8          capital program that the state funds, perhaps 

 9          we ought to do that.  But that's not what we 

10          have.  

11                 So there are differences between them.  

12          This happens to be one of the differences.  

13          You know, why it's in there, I wouldn't want 

14          to speculate about.  But it is different from 

15          other programs, but it isn't necessarily 

16          unusual in that sense, just --

17                 ASSEMBLYMAN KAVANAGH:  Okay.  Well, I 

18          recognize you're speaking on behalf of the 

19          full Executive on this topic.  But it is the 

20          Executive's proposal this time.  So I'd like 

21          a clear answer of why that is desirable and 

22          whether there are other programs.  And I 

23          recognize that you don't have that answer 

24          today.


 1                 One more quick question.  421-a, as 

 2          previously legislated and signed into law by 

 3          the Governor, was part of a comprehensive 

 4          deal a couple of years ago that included a 

 5          deal on rent regulation and many other 

 6          things, in the way that we do business in 

 7          Albany.  The provision was that it would go 

 8          into effect and then it would be suspended 

 9          unless the real estate industry -- 

10          represented by REBNY -- and the trade unions 

11          could come to a deal on wages.  It was 

12          suspended when that MOU was not put in place.  

13                 Is it your understanding that the law 

14          is still -- the law didn't expire at that 

15          point, right?  It's merely suspended by the 

16          lack of an MOU.  Is it not the case that the 

17          real estate industry, if they could come to a 

18          deal under existing law with their workforce 

19          on wages, they could continue -- the 421-a 

20          program would continue as enacted by this 

21          Legislature and the Governor?

22                 COMMISSIONER RUBIN:  I think that 

23          we -- I'd have to get you -- unfortunately, I 

24          stopped being an actual lawyer several years 


 1          ago when I stopped paying my bar fees, which 

 2          was a great relief to me.

 3                 ASSEMBLYMAN KAVANAGH:  Three hundred 

 4          dollars.

 5                 COMMISSIONER RUBIN:  I was a terrible 

 6          lawyer.  So I would have to come back to you 

 7          with an actual legal response as opposed to 

 8          simply saying what I guessed.

 9                 CHAIRMAN FARRELL:  Thank you.  Thank 

10          you.  

11                 ASSEMBLYMAN KAVANAGH:  Okay, if you 

12          could just -- because you did testify before 

13          that this program was necessary, the program 

14          proposed by the Governor is necessary to 

15          restart the program.  I would assert that 

16          it's not necessary to restart the program, 

17          it's just that the deal we made was not 

18          deemed to be sufficiently generous to the 

19          real estate industry to cover living wages 

20          for -- or prevailing wages for their workers.  

21                 But thank you, and I realize I'm way 

22          over time.

23                 CHAIRMAN FARRELL:  Thank you.

24                 CHAIRWOMAN YOUNG:  Senator Krueger.


 1                 SENATOR KRUEGER:  Hi.  It's amazing, I 

 2          only got through one question the first five 

 3          minutes.  So we have several hours.

 4                 You just answered a question, I 

 5          believe correctly, that the risk to the 

 6          low-income housing tax credit means there 

 7          will be more pressure on the state and other 

 8          members of government to come up with the 

 9          capital money and subsidy money needed to 

10          build affordable housing.  And I agree 

11          completely.  

12                 So if today, in 2017, knowing what we 

13          know I came to you and said, for every $100 

14          you give me, I'll give you $11 of affordable 

15          housing, do you think that would be a good 

16          deal?

17                 COMMISSIONER RUBIN:  (No response.)

18                 SENATOR KRUEGER:  Would that pass 

19          muster?  That's in fact what the incoming 

20          commissioner's expertise has been all these 

21          years.

22                 COMMISSIONER RUBIN:  So our math 

23          skills -- I think my math skills and the 

24          incoming commissioner's math skills are 


 1          probably on a par, and I would say that that 

 2          would be a -- the hypothetical deal would not 

 3          be one that we would think would be 

 4          appropriate.

 5                 SENATOR KRUEGER:  And if I came to you 

 6          with a deal and said, Okay, it was $11 worth 

 7          of housing for $100, but now it's going to be 

 8          less, do you think that would be a better 

 9          deal?  You already said that wouldn't be a 

10          good deal.

11                 COMMISSIONER RUBIN:  It doesn't sound 

12          like it.

13                 SENATOR KRUEGER:  All right.  So the 

14          Governor's new affordable housing plan, based 

15          on several analysts' independent analyses, 

16          show that the old 421-a was getting us, for 

17          $1.1 billion a year in lost tax revenue, 

18          154,000 residential units, of which only 

19          12,700 were affordable.  That's $11 for every 

20          hundred dollars given.  

21                 The new proposed analysis is that it 

22          could be costing us over $2 billion a year in 

23          lost tax subsidy for just slightly more or no 

24          more affordable housing.  If I am correct 


 1          that that's the numbers, why would anyone 

 2          think it would be a good idea to go forward 

 3          with this program?

 4                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

 5          think those numbers were also numbers that 

 6          were cited by the mayor of the City of 

 7          New York when he came and testified here.  I 

 8          think, right, he went through the prior 

 9          iteration of the program was providing about 

10          12,000 units of affordable housing a year, 

11          and in the new iteration I believe his number 

12          was about 21 or 25,000 units a year?  

13                 SENATOR KRUEGER:  No, that was in the 

14          proposal I think that he had hoped to get, 

15          but not the Governor's proposal.

16                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

17          thought that was his reference to the -- he 

18          was proposing 25 and he thought the 

19          Governor's proposal was going to be 21.  So 

20          it's still substantially more than the 

21          previous program, but not as many units as 

22          they had --

23                 SENATOR KRUEGER:  I actually think the 

24          mayor's numbers were wrong also, by the way. 


 1                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 2          Okay.  My understanding, that some of the -- 

 3          and I'm not sure if this is the nature of 

 4          your question -- they believe that some 

 5          number of apartments will switch into condos, 

 6          and that accounted for some of the 

 7          differential between the 21 and the 25.

 8                 I guess what I can say, sort of at a 

 9          macro level, is that the legislation approved 

10          last year is largely legislation that is 

11          important to the city, and that they feel is 

12          important to production of rental housing.  

13          It is their tax base, and it was their sort 

14          of reconstructed program.  So I think they 

15          find value in it and think -- it's obviously 

16          a portion of the mayor's overall 10-year 

17          affordable housing plan.  It's -- again --

18                 SENATOR KRUEGER:  I'm actually not 

19          asking you what the mayor thinks, I was 

20          asking what you think.

21                 The last year's program is moot.  I 

22          just -- that one sunset.  So the question is 

23          on the proposal before us that the Governor 

24          has in the budget, just to clarify, that 


 1          doesn't allow condominiums, the proposal in 

 2          the budget, does it?  

 3                 EX. DEP. COMMISSIONER VISNAUSKAS:  The 

 4          current legislation as proposed has two I 

 5          would say substantial differences than what 

 6          was in the past, one around affordability.  

 7                 So one is, right, every building 

 8          receiving 421-a has an affordable component 

 9          leading, obviously, to the large increase in 

10          affordable units citywide.  And then there is 

11          a provision, there are four or maybe five 

12          programmatic options within the proposed 

13          legislation -- what was both approved last 

14          year and as currently proposed -- one of 

15          which allows the tax benefit to go to 

16          buildings that are 35 units or less located 

17          in the outer boroughs, where the condominiums 

18          have an assessed value of $65,000 or less.

19                 SENATOR KRUEGER:  It actually has I 

20          think seven options in the proposal, when you 

21          count that condominium piece, because it's 

22          (A) through (G) plus that little condo 

23          section.

24                 All right, so I represent a part of 


 1          Manhattan below 96th Street -- I stop at 

 2          96th Street -- the East Side, parts of 

 3          Midtown.  There is a subsection of Option G 

 4          that any building with 300 rental units, 

 5          regardless of where it is -- it doesn't have 

 6          to be inside or outside the enhanced 

 7          affordability area -- any apartment building 

 8          of 300 or more units can take advantage of 

 9          this program, a 35-year, 100 percent 

10          abatement, as long as 30 percent of the units 

11          are affordable, with AMI defined as 130 

12          percent.  Which most of my colleagues would 

13          assure you none of us think meets the 

14          definition of AMI affordability, 130 percent 

15          of AMI.

16                 If I look at my district today, an 

17          overheated real estate geography, I am 

18          watching developers buy up whole blocks of 

19          low-level rent-regulated and rent-controlled 

20          apartment buildings in plans for this law to 

21          go into effect.  They are trading air rights 

22          and trading buildings to make their packages 

23          so that they can build over 300 units per 

24          building, not hard to do.  There will be 


 1          30 percent at 130 percent of AMI, with a 

 2          massive loss of existing affordable units, 

 3          all over, I would argue, the East Side, the 

 4          West Side, and downtown Manhattan and north 

 5          of 96th Street, which is gentrifying at a 

 6          radically quick rate.  And in certain 

 7          sections of Brooklyn, I suspect Senator 

 8          Velmanette Montgomery's district and others, 

 9          and very, very, very quickly.  And it will 

10          end up being probably the largest-used 

11          portion of this law.

12                 As Assemblymember Cymbrowitz talked 

13          about before, we've taken away any power by 

14          the City of New York to say, Wait a second 

15          here, what the hell's going on?  When you 

16          said this is not a surprise to the city, I 

17          will tell you that I have stood with my 

18          City Council members, my borough president, 

19          any number of housing advocates and housing 

20          analysts in the City of New York, to say out 

21          loud that this is a terrible plan for the 

22          future of affordability of city housing and 

23          that it will cost the city far, far more than 

24          what's being projected, just specifically 


 1          because of the problems in this Option G, 

 2          300-plus rental units.  If we pass this law, 

 3          which will conceivably wipe out affordable 

 4          housing in Manhattan in a pretty quick time 

 5          frame, do you have the power to stop any 

 6          individual deal?  Can you say no?  Or is it 

 7          as of right?

 8                 EX. DEP. COMMISSIONER VISNAUSKAS:  I'm 

 9          going to start, if you want to pick up.

10                 COMMISSIONER RUBIN:  Sure.

11                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

12          think it sort of divides the issue in my mind 

13          into questions, but I want to make sure that 

14          I'm getting it right.  I mean, the way I 

15          would understand the ability for someone to 

16          certainly buy up and build a 300-unit or 

17          larger building is sort of irrespective of 

18          421-a.  It's more of a -- you know, obviously 

19          it's a market-based decision for any 

20          developer.  The only reason they would --

21                 SENATOR KRUEGER:  But when you're 

22          getting a 100 percent abatement on your taxes 

23          for 35 years, it suddenly looks even better 

24          and better, doesn't it?


 1                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 2          That may be true, but in exchange for that, 

 3          right, they have to pay a higher wage than 

 4          they would otherwise, they have to go from 

 5          35 years to 40 years of affordability, which 

 6          is not insignificant, and they have a slight 

 7          tweak to their --

 8                 SENATOR KRUEGER:  Well, since the 

 9          average hourly construction wage must be $45 

10          an hour, Manhattan buildings going up at 

11          300 units or more are already paying that.  

12          So this is not a new universe --

13                 COMMISSIONER RUBIN:  That is 

14          absolutely incorrect, Senator.  I'm sorry,  

15          but we did a substantial analysis in advance 

16          of this, and that is not the case.

17                 SENATOR KRUEGER:  You did a 

18          substantial analysis of the cost of --

19                 COMMISSIONER RUBIN:  Absolutely.

20                 SENATOR KRUEGER:  -- of building with 

21          labor -- with union labor?  

22                 COMMISSIONER RUBIN:  Mm-hmm, for sure.  

23          This is not a union labor requirement, 

24          Senator, this is a wage requirement.  


 1                 SENATOR KRUEGER:  No, I know.  But 

 2          basically if I look at the buildings going up 

 3          in my borough that are 300 or more --

 4                 COMMISSIONER RUBIN:  Senator, let's be 

 5          very clear -- yeah, Senator, I live in your 

 6          district.  Let's be very clear what we're 

 7          talking about.

 8                 SENATOR KRUEGER:  Yes.

 9                 COMMISSIONER RUBIN:  Luxury 

10          condominium buildings --

11                 SENATOR KRUEGER:  Yes.

12                 COMMISSIONER RUBIN:  -- are different 

13          from rental buildings, which is what we're 

14          talking about in the case of 421-a.  So the 

15          labor costs for a luxury rental -- a luxury 

16          condominium building may be different.  We 

17          never see those.  I have absolutely no idea 

18          what the costs are.  But in the case of 

19          rental buildings, labor costs are 

20          substantially lower than what they're going 

21          to be as a result of this law.

22                 SENATOR KRUEGER:  Okay.  So it's -- 

23          that's a sidebar question.  That doesn't 

24          change the reality that we'll be knocking 


 1          down enormous numbers of affordable units to 

 2          put up luxury rental buildings where 

 3          30 percent will have to be only 130 percent 

 4          of AMI.  Am I wrong that it only -- that it's 

 5          130 percent AMI?

 6                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 7          That is one of the options that's been -- 

 8          that was passed by the Legislature in 

 9          January.  Right?  The 70 percent at 130 has 

10          been in the program since last year.  That's 

11          not a new --

12                 COMMISSIONER RUBIN:  Absolutely.

13                 EX. DEP. COMMISSIONER VISNAUSKAS:  

14          That's not a new option.

15                 SENATOR KRUEGER:  It was bad then too.  

16          I'm not arguing that.

17                 EX. DEP. COMMISSIONER VISNAUSKAS:  

18          Fair enough.

19                 SENATOR KRUEGER:  But the good news is 

20          that never went into effect, and the City of 

21          New York had some role of authorization or 

22          having to sign off.  

23                 The City of New York would have no 

24          authorization or signing off or saying "Stop" 


 1          or "We question that" under this new law, as 

 2          Assemblymember Cymbrowitz pointed out.

 3                 COMMISSIONER RUBIN:  Senator, I'm 

 4          sorry, I may be wrong about this, but I think 

 5          that in the existing law, while the City of 

 6          New York may have retained some ability to 

 7          change the law, this was their proposal that 

 8          they put forward.  So I think there is 

 9          exactly zero chance --

10                 SENATOR KRUEGER:  As I said, I don't 

11          agree with the city of -- the mayor's 

12          position either.  But I'm not asking him now, 

13          I'm asking you.

14                 COMMISSIONER RUBIN:  Yeah.

15                 SENATOR KRUEGER:  You're proposing 

16          this as a state program within the state 

17          budget.

18                 COMMISSIONER RUBIN:  That is correct.

19                 SENATOR KRUEGER:  Okay.  And so again, 

20          I'm asking you, do you -- I think I got the 

21          answer.  It's a bad economic deal.  This --

22                 COMMISSIONER RUBIN:  Absolutely not, 

23          Senator.

24                 SENATOR KRUEGER:  No?


 1                 COMMISSIONER RUBIN:  Absolutely not.  

 2          I agree that --

 3                 SENATOR KRUEGER:  You just said 

 4          getting a hundred dollars worth of -- getting 

 5          $11 worth of real estate for $100 isn't a 

 6          good deal.

 7                 COMMISSIONER RUBIN:  Yeah, but 

 8          Senator, those are the real numbers that play 

 9          out in the real world.  The suggestion that 

10          you made -- the hypothetical that you 

11          proposed is not the one that we see in the 

12          development community every day.  So let's 

13          just be very, very clear, the numbers as we 

14          understand them to play out in the real world 

15          are not the $100 for $11, they are -- they 

16          are market economics that lead to the 

17          development of affordable housing and rental 

18          housing in the City of New York.  

19                 And I would add something else, and 

20          RuthAnne can talk about this from her 

21          experience at HPD.  I would venture to say 

22          that there is almost no rental housing of any 

23          kind that gets developed across the City of 

24          New York, regardless of geographic area, 


 1          without some tax abatement in place.  That is 

 2          the result of, you know, property tax -- you 

 3          know, property tax problems that we can talk 

 4          about at some separate time.  But the fact is 

 5          you need tax abatements to develop rental 

 6          housing in New York, period.  And, you know, 

 7          we may all think that that's a bad idea, but 

 8          it is a fact of the market.  

 9                 So this is a tax abatement program, 

10          one among many that people use to develop 

11          rental housing in New York.  And it happens 

12          to have attached to it the requirement that a 

13          developer who gets advantage of it adds in 

14          affordable housing, which I think is 

15          basically a net good.  And we just -- all 

16          we've done in this -- all the Governor has 

17          done in the Affordable New York Housing 

18          Program you now have in front of you is to 

19          add one extra requirement, which is that very 

20          large buildings that are developed in very, 

21          very high opportunity, high-rent areas pay 

22          fair wages.  I think that's something that we 

23          would all agree is a good thing.

24                 SENATOR KRUEGER:  I would argue that's 


 1          a discussion for the economic development and 

 2          labor world, not to use up city taxpayer 

 3          money that's being arguably used without the 

 4          approval of the city or their taxpayers, not 

 5          for housing but for a labor agreement.  

 6          Right?  They're two different questions.

 7                 And if you're taking away more 

 8          affordable units than you're putting in under 

 9          this model, I don't even see how you can 

10          argue it's a win geographically for 

11          affordable housing.

12                 COMMISSIONER RUBIN:  But, Senator, I'm 

13          not agreeing with your hypothetical.  I don't 

14          think that is what's happening.  I live in 

15          the same district, I know what goes on there 

16          just like you do, but that is not the result 

17          that we think is going to happen as --

18                 SENATOR KRUEGER:  But that's actually 

19          happening already.  It slowed down a little 

20          bit when 421-a stopped, although everybody 

21          has got everything but shovel in the ground.  

22          So it is happening.

23                 COMMISSIONER RUBIN:  As has the 

24          construction of new affordable housing due 


 1          specifically under 421-a.  So now we're going 

 2          to restart it and you're going to see, I 

 3          think by the city's own estimates, several 

 4          thousand new units developed of affordable 

 5          housing over the next several years.

 6                 SENATOR KRUEGER:  At a ridiculously 

 7          high price.  

 8                 Oh, I don't -- you know what, next 

 9          round.  Thank you.

10                 COMMISSIONER RUBIN:  Thank you.

11                 CHAIRWOMAN YOUNG:  Senator Bailey.

12                 SENATOR BAILEY:   Let me be the first 

13          to wish you good afternoon.

14                 COMMISSIONER RUBIN:  Good afternoon.

15                 SENATOR BAILEY:  So a couple of quick 

16          questions.  

17                 First, sometimes when I'm with my 

18          daughter I find it to be a minor 

19          inconvenience when there's no changing table 

20          in the restroom.  But there are issues that 

21          single homeless fathers are facing throughout 

22          the State of New York concerning a lack of 

23          accommodation.  Can you tell me the steps 

24          that HCR is taking to remedy some of the 


 1          shelter crisis with the single fathers across 

 2          the state?  

 3                 EX. DEP. COMMISSIONER VISNAUSKAS:  Our 

 4          primary role in homelessness is not around 

 5          shelters, that's more under the purview of 

 6          OTDA, who I believe you've heard from.  

 7                 SENATOR BAILEY:  I misspoke, I'm 

 8          sorry.

 9                 EX. DEP. COMMISSIONER VISNAUSKAS:  Our 

10          main focus is obviously on supportive 

11          housing, and we have a very robust, as I 

12          mentioned, commitment to do 6,000 units of 

13          supportive housing.  And that -- it's a -- 

14          it's not one type of housing, I think to your 

15          question.  Right?  There is housing for -- we 

16          provide housing for, you know, mentally ill 

17          individuals, for families, for veterans, for 

18          runaway youth.  

19                 You know, we recognize that 

20          homelessness is a problem that is across a 

21          spectrum of housing types and individuals, 

22          and we will provide to that need.

23                 SENATOR BAILEY:  Okay.  The second 

24          question I have is for -- I spoke about the 


 1          northern Bronx portion of my district.  In 

 2          the City of Mount Vernon we're facing a 

 3          crisis around zombie properties.  There was 

 4          some legislation around that last year.  But 

 5          I want to know what is HCR's plan, both 

 6          short-term and long-term, to, one, help 

 7          remedy this issue in the City of Mount Vernon 

 8          and help them get these properties back to 

 9          the tax rolls or finding some other use for 

10          them.  

11                 Because Mount Vernon is a city -- 

12          it's -- as the former Senator can attest to, 

13          there's a lot of pride and a lot of great 

14          things that can be done, but we need to make 

15          sure that these zombie properties are taken 

16          care of.  Can you explain what your role may 

17          be in that?

18                 EX. DEP. COMMISSIONER VISNAUSKAS:  

19          Yeah, I'd be happy to.  It's an issue that's 

20          of great concern to us, and we're very 

21          focused on it.  We have a couple of 

22          programmatic responses which I'll talk 

23          through, and we would also be happy to come 

24          sit in Mount Vernon and talk specifically 


 1          about the issues more locally there.

 2                 SENATOR BAILEY:  We'd greatly 

 3          appreciate that.

 4                 EX. DEP. COMMISSIONER VISNAUSKAS:  We 

 5          have -- last year we launched a pilot called 

 6          the Neighborhood Revitalization Program that 

 7          provides subsidy to homeowners who will buy 

 8          zombie homes, along with our SONYMA homebuyer 

 9          programs.  So it's sort of capital money to 

10          do repairs for folks who will buy zombie 

11          homes, you know, where the economics don't 

12          make sense of buying and you need that extra 

13          money to make sure it's -- to bring it back 

14          into habitability.  

15                 We also last year were thrilled to 

16          have legislation passed for the Community 

17          Revitalization Fund, which is a subsidiary of 

18          SONYMA.  And we are using that to buy both 

19          defaulted notes that entities like HUD, FHA, 

20          Fannie Mae, Freddie Mac hold in the State of 

21          New York and do both modifications -- so it's 

22          people sort of in homes who are maybe subject 

23          to foreclosure, to keep them stable -- as 

24          well as homes that may be vacant.  


 1                 It's a longer process to work with 

 2          those entities to buy notes.  We are working 

 3          very feverishly to have something completed 

 4          within the next couple of months that we 

 5          would be happy to talk about that.  But we 

 6          are -- we'd be happy to talk more about that.  

 7          But we are working, as I said, very 

 8          diligently to try and address this issue.  

 9                 We have several -- we have, in 

10          addition, a pool of nonprofits around the 

11          state.  We work with the land banks, we work 

12          with folks around foreclosure prevention.  We 

13          have several counseling programs that we get 

14          funding from HUD to provide to keep people in 

15          their homes to prevent sort of the stem -- 

16          the growth of zombies.  

17                 So we would be happy to sit down and 

18          talk to you about both what we do and what 

19          you think we could do more.

20                 SENATOR BAILEY:  I would welcome the 

21          opportunity.  

22                 And concerning, again, TPU, I just 

23          wanted to I guess make a blanket statement 

24          that it is doing great work.  And I've been 


 1          made aware that you've recovered over 6,000 

 2          rental units in my district.  And I think it 

 3          would be helpful, if the other members have 

 4          not received that data, for you to 

 5          disseminate that information to each member 

 6          so that we know exactly what you are doing 

 7          concerning TPU in our respective districts.

 8                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 9          Absolutely.

10                 SENATOR BAILEY:  Thank you.  

11                 Thank you, Madam Chair.

12                 CHAIRWOMAN YOUNG:  Thank you.  

13                 People think of Mitchell-Lama as a 

14          New York City-only program, but as you know, 

15          it's a statewide program.  And I think 

16          there's supposed to be an annual report.  I 

17          haven't seen it.  Do you know if it's been 

18          issued?  

19                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

20          don't know, but we can certainly check and 

21          get back to you.

22                 CHAIRWOMAN YOUNG:  If you can get to 

23          us in the Senate a report detailing the 

24          individual projects funded under 


 1          Mitchell-Lama and also detail on, you know, 

 2          how these projects were financed, the 

 3          associated costs, including state and federal 

 4          resources that were invested.  Because as you 

 5          know, if you'd put together a package on it, 

 6          that would be really helpful.

 7                 Sorry to keep bogging you down with 

 8          all these.  

 9                 I was going to ask about bond 

10          allocations, but I think I'll skip that.  But 

11          I do want to ask about Rural and Urban 

12          Community Investment Fund.  And I was 

13          wondering if you could give us a brief 

14          update on funding and awards provided by the 

15          program.

16                 EX. DEP. COMMISSIONER VISNAUSKAS:  

17          Sure.  We have a very nice active pipeline of 

18          projects that have come in.  We have 

19          exhausted our allocation, I believe, for this 

20          current year, and are -- as soon as we get 

21          our budget, we'll release an RFP for the 

22          next -- I believe it's $36 million that's 

23          still in the House New York funding that we 

24          had a couple of years ago for that program.  


 1                 And so I'd be happy to sit down with 

 2          you and go through the projects specifically 

 3          that we funded with that.  But suffice to say 

 4          we have awarded the funds that we have, and 

 5          it's a great program.  Folks around the state 

 6          are really excited about it, and we have a 

 7          nice pipeline.

 8                 CHAIRWOMAN YOUNG:  I'd love to get 

 9          together with you and the Finance and the 

10          Housing staff to talk about that.

11                 Now, in the Governor's proposal he has 

12          additional funding, $36 million through the 

13          MIF, through the Mortgage Insurance Fund, and 

14          $45 million in capital appropriations.  And 

15          how do you see this funding adding to the 

16          affordable housing stock statewide?  

17                 EX. DEP. COMMISSIONER VISNAUSKAS:  

18          Those two funds are specific for something, 

19          the 36 and the 45.  That's for the Community 

20          Investment Fund, or that's a different --

21                 CHAIRWOMAN YOUNG:  It's through the 

22          Community Investment Fund, I believe.

23                 EX. DEP. COMMISSIONER VISNAUSKAS:  I'm 

24          sorry, just ask your question again so I make 


 1          sure I answer it right?

 2                 CHAIRWOMAN YOUNG:  So you're 

 3          looking -- how do you think this will be 

 4          distributed statewide?  

 5                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 6          Well, certainly through the Community 

 7          Investment Fund we will hold to the 60/40 

 8          split of urban and rural, if that's what you 

 9          were asking, absolutely.

10                 CHAIRWOMAN YOUNG:  And do you -- are 

11          there any impediments in getting the funding 

12          out?  Is there anything that we need to do 

13          differently to make sure it --

14                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

15          can check with the program staff, but I 

16          generally think that's a program that folks, 

17          you know, feel is very easy to access and 

18          use.

19                 CHAIRWOMAN YOUNG:  Okay, thank you.  

20          That would be great.

21                 The Governor also proposes $5 million 

22          for the Recent Graduate Homeownership 

23          Program, which sounds intriguing to me.  But 

24          can you provide any additional information 


 1          about it?  

 2                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 3          Sure.  So we are using the -- our SONYMA 

 4          platform again to provide a deeper interest 

 5          rate to recent graduates to stay upstate, 

 6          specifically in upstate towns, to try to give 

 7          people the option to achieve homeownership at 

 8          a lower rate and in sort of our various 

 9          important upstate communities.  So we just 

10          launched this recently, so we don't have any 

11          numbers on the uptake yet, but we look 

12          forward to it being a robust program.

13                 CHAIRWOMAN YOUNG:  I think it's a 

14          great idea, because you know our biggest 

15          export out of upstate are our young people, 

16          and they feel like they don't have a future 

17          in New York.  So I think this is a wonderful 

18          idea.  And so any more information you have 

19          about it would be great, on top of what you 

20          just explained.

21                 Finally, on the MIF, there's a 

22          year-to-year decrease in the MIF allocation.  

23          What has caused the decrease?  

24                 EX. DEP. COMMISSIONER VISNAUSKAS:  We 


 1          had a slight decrease this year where -- the 

 2          number, I believe, is 141 million and change.  

 3          The reason for the difference I think is 

 4          probably a question better answered by the 

 5          Department of Budget.  I don't think we know 

 6          the --

 7                 CHAIRWOMAN YOUNG:  Do you know, 

 8          however, if there's an impact to the fund's 

 9          risk-to-credit ratio?  

10                 EX. DEP. COMMISSIONER VISNAUSKAS:  No, 

11          we feel very comfortable at the moment that 

12          the -- the amount that came out of the MIF 

13          this year is somewhat consistent with 

14          previous years.  You know, it's a little bit 

15          off, but we feel that that amount maintains 

16          the creditworthiness and accessibility of the 

17          MIF.

18                 CHAIRWOMAN YOUNG:  Okay, thank you.  

19                 Senator Krueger.

20                 SENATOR KRUEGER:  Ah, thank you.  

21                 So much -- so much territory.  In 

22          2014, the State Comptroller did an audit of 

23          the administration of tenant complaints by 

24          HCR, and he made a series of recommendations.  


 1          You wrote a response -- well, not you, 

 2          actually, excuse me.  It was the prior 

 3          commissioner.  You weren't there yet, right?  

 4                 COMMISSIONER RUBIN:  No.

 5                 SENATOR KRUEGER:  Okay.  But the 

 6          response, specific to the enormous concerns 

 7          about time frame for getting cases resolved, 

 8          I think really circled around the problems of 

 9          inadequate computers, which is in fact what 

10          you wrote -- your agency wrote, neither the 

11          outgoing commissioner nor the incoming 

12          commissioner, previous -- let's see, saying 

13          that we have enormous problems because our 

14          computer is a legacy mainframe system and a 

15          plan for a much better system in place to 

16          ensure compliance -- I'm not reading the 

17          whole letter -- the design, build and 

18          implementation of the new system will start 

19          in September 2014 and be completed by 

20          February 2015.  

21                 But we're subject to state 

22          appropriations.  So how is that new system 

23          working for you?

24                 EX. DEP. COMMISSIONER VISNAUSKAS:  


 1          It's not here yet, but I'm happy to say -- 

 2          well, I can't deliver on those dates.  We 

 3          have signed the contract with the consultant 

 4          who is doing the modernization, so it is 

 5          underway and will be completed I believe by 

 6          the end of this year.  

 7                 And we have also made great strides --

 8                 SENATOR KRUEGER:  The computerization 

 9          will be completed this year?

10                 EX. DEP. COMMISSIONER VISNAUSKAS:  We 

11          are in contract with the consultant who's 

12          doing the modernization of our existing 

13          system, which is both the internal processing 

14          and also the external facing system.  So that 

15          is underway.  The consultant has been 

16          engaged, and the work has started.

17                 So we're thrilled about that.  Albeit 

18          late, it is happening.  

19                 We have also made great strides in the 

20          last year at getting our processing times 

21          down.  I can certainly follow up with more 

22          specifics, but for some of our processes that 

23          we're having over sort of a 12-month timeline 

24          to get resolved, many of those are now under 


 1          six months, and some even at four months 

 2          turnaround.  

 3                 So again, I'm happy to -- I'm sort of 

 4          new to this area, so I don't have the stuff 

 5          in my brain, but I'm happy to go through it 

 6          with you on sort of where we've made 

 7          improvements.  But we, under Jamie's 

 8          leadership, have done an enormous amount this 

 9          last year to get those times down.

10                 SENATOR KRUEGER:  And outgoing 

11          Commissioner Rubin, your new title is?

12                 COMMISSIONER RUBIN:  State director of 

13          operations.

14                 SENATOR KRUEGER:  So as state director 

15          of operations, can you do everything possible 

16          to ensure that there's no more delays in the 

17          critical role of computerization for the 

18          agency you're leaving?  

19                 COMMISSIONER RUBIN:  I can try, but 

20          I'm told the new commissioner is 

21          extraordinarily difficult to work with.  

22                 (Laughter.)

23                 SENATOR KRUEGER:  I mean, you know, 

24          we're laughing, but this was a discussion I 


 1          had, I believe with Governor Cuomo upon his 

 2          inauguration, and my frustration with wanting 

 3          the agency to have the tools it needed to 

 4          have to do the work it needed to do on behalf 

 5          of people all over the State of New York.  

 6          And he had committed at that time that he 

 7          knew of this, he was a housing expert 

 8          himself, and this was a top priority for his 

 9          administration.  

10                 So now in 2017, I am literally begging 

11          you, do something to get this done.

12                 COMMISSIONER RUBIN:  You don't need to 

13          beg.  Senator, I share your frustration.  So 

14          when I showed up two years ago, one of the 

15          first visits that I made was out to Queens, 

16          where, as you know, the ORA is located.  And 

17          I'm happy to tell you, by the way, that 

18          RuthAnne went out there this week before she 

19          even took office.  So the continuity of focus 

20          on that area is not -- is going to be 

21          maintained and I think accelerated.  And it 

22          is a terrific thing that we actually have 

23          this modernization effort up and running.

24                 I will say that it was, at the agency 


 1          level, the modernization effort was ready to 

 2          be started a couple of years ago.  You have 

 3          the letter, obviously, from my predecessor 

 4          Mr. Towns, but at the time, you know, what he 

 5          wrote in that letter he thought to be 

 6          accurate.  And there was work being done to 

 7          prepare -- you know, obviously, it's a large 

 8          contract with an RFP, it has to be bid on a 

 9          competitive basis, for all the reasons that 

10          you would expect.  

11                 And the agency was ready to go, and 

12          there were some external factors that 

13          intervened, among them, you know, the 

14          Comptroller, with whom we have a very good 

15          working relationship, but reviewed the 

16          contract -- at one point reviewed the RFP and 

17          found it to be lacking, for reasons that we 

18          completely disagreed with.  We pointed out to 

19          them the -- I did -- the irony of the fact 

20          that they were -- they had done the audit and 

21          now were holding up the process by which we 

22          would remedy the problems that they 

23          identified in the audit.  And they did move 

24          ahead and gave us the ability to go forward, 


 1          but it did put a substantial timeline -- 

 2          substantially extended the timeline with 

 3          which we were able to operate and fix the 

 4          problems that you're focusing on.

 5                 Again, we have a very good 

 6          relationship with the Comptroller's office, 

 7          but it was just a -- you know, for whatever 

 8          reason, it just didn't -- there was not a 

 9          meeting of minds at that point, which creates 

10          an issue.

11                 SENATOR KRUEGER:  So an uninvited, 

12          perhaps, suggestion.

13                 COMMISSIONER RUBIN:  Sure.

14                 SENATOR KRUEGER:  Yesterday Dennis 

15          Rosen, the Medicaid inspector general, 

16          testified before whoever of us was here 

17          yesterday.  And many of us had worked with 

18          him when he took over the SLA for the state 

19          before that.  He's very good at evaluating 

20          and improving systems quickly, and he always 

21          impresses everyone with what he can 

22          accomplish by looking at an agency that's 

23          defined as having problems and getting 

24          systems in place to both, A, solve problems 


 1          more efficiently and, B, avoid them in the 

 2          first place.  

 3                 So I'm not really being facetious when 

 4          I suggest -- I'm sure there's other talented 

 5          people in state government who could come in 

 6          and help.  But I would ask you to go ask him 

 7          to take a look --

 8                 COMMISSIONER RUBIN:  That's a great 

 9          suggestion.  I appreciate it.

10                 SENATOR KRUEGER:  -- because he's 

11          actually just a damn good administrator.  

12                 You like him also, Cathy Young, don't 

13          you?  I saw --

14                 CHAIRWOMAN YOUNG:  Of course I do.

15                 SENATOR KRUEGER:  Of course you do.  

16          Exactly.

17                 COMMISSIONER RUBIN:  It's a great 

18          suggestion, thank you.

19                 SENATOR KRUEGER:  All right, thank 

20          you.  

21                 Rent control.  A small number of 

22          people every year, year in, year out, we 

23          raise their rents 7.5 percent, even though 

24          they come and they beg you to use your 


 1          authority within the agency to evaluate the 

 2          realities of expenses and costs, just like is 

 3          done for rent-regulated apartments.  And in 

 4          the rent-regulated system, year in, year out, 

 5          I've seen high years, I've seen low years.  

 6          I've seen everybody argue on both sides about 

 7          it.  But I've never seen a year where it was 

 8          over 4 percent, even in the worst-case 

 9          scenarios.  In the last couple of years, it's 

10          been zero or 1 percent.  

11                 Could someone please reevaluate why 

12          the hell it's 7.5 percent for these elderly 

13          poor people in their rent-controlled 

14          apartments?  And it is within your authority 

15          to do something about it.

16                 EX. DEP. COMMISSIONER VISNAUSKAS:  I'd 

17          be happy to.  As you know, I'm new -- this 

18          area of the agency is new to me, so I'm -- I 

19          just started this past week sort of jumping 

20          in and learning the ins and outs.  But I'm 

21          happy to put my effort towards that and also 

22          come back and sit with you and talk about it.

23                 SENATOR KRUEGER:  And I have 15 years 

24          worth of testimony before you every year, if 


 1          you'd like, to just resend.

 2                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 3          Fair enough.  Okay.

 4                 SENATOR KRUEGER:  All right?  

 5                 Senior housing.  My colleague Cathy 

 6          Young asked some questions about senior 

 7          housing.  And in the City of New York, I 

 8          think we define our waitlist for low-income 

 9          senior housing at 200,000 people.  I tell 

10          people when they hit middle age to apply, 

11          because maybe by the time they're a senior 

12          senior, something might come up.

13                 She asked you the one question about 

14          the specialized program within the state 

15          budget proposal for capital money for senior 

16          housing, and I just want to reiterate I agree 

17          with her.  We need to make sure we're 

18          defining the evaluation for that application 

19          process as really matching the models that we 

20          know work in the population in need.  And 

21          it's a statewide issue.  

22                 Are you fans of the Section 8 program, 

23          from your housing evaluation?  I mean, you 

24          don't have anything technically to do with 


 1          it, but you know what it is.

 2                 EX. DEP. COMMISSIONER VISNAUSKAS:  Of 

 3          course, yes.  And we -- and we oversee a 

 4          large Section 8 program -- 

 5                 SENATOR KRUEGER:  Oh, you do, outside 

 6          of New York City.  Excuse me.  So sorry.

 7                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 8          Yes, absolutely.  So, I mean, Section 8 is a 

 9          critical resource for very low income 

10          individuals now.

11                 SENATOR KRUEGER:  So the City of 

12          New York has actually proposed to have a 

13          Section 8 supplemental program that they have 

14          one plan to fund, which may or may not get 

15          through the budget process.  But it would 

16          create a Section 8 specifically for 25,000 

17          low-income seniors in the city, paid for by 

18          the city.  Have you had a chance to evaluate 

19          that proposal?  

20                 EX. DEP. COMMISSIONER VISNAUSKAS:  I 

21          have not.  I just saw it came out in the last 

22          couple of days, but I haven't seen specifics 

23          on it other than what I saw on the news.

24                 SENATOR KRUEGER:  I'd appreciate, 


 1          actually, getting a response back.  Because 

 2          it seems to me it's sort of exactly the kind 

 3          of program we ought to be looking into, even 

 4          be looking at beyond New York City and even 

 5          within the confines of what the state could 

 6          do.  

 7                 It's money that subsidizes rent to 

 8          help senior citizens stay in their home, 

 9          which -- and I think we all know one of the 

10          most tragic situations is a senior citizen 

11          being evicted.  And frankly, at least in the 

12          City of New York, if they lose wherever 

13          they're living, you're not going to find them 

14          an apartment that's affordable.  And again, 

15          they're not going to live long enough to get 

16          through that waiting list of 200,000.  

17                 So I actually think the concept of a 

18          state and/or city Section 8 program for 

19          elderly poor people at risk of losing their 

20          homes is a fabulous idea, and I would urge 

21          the state to consider exploring it within 

22          your budget proposals as well.

23                 Thank you.

24                 COMMISSIONER RUBIN:  Thank you, 


 1          Senator.

 2                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 3          Thank you.  

 4                 CHAIRMAN FARRELL:  Thank you.

 5                 CHAIRWOMAN YOUNG:  Thank you.  I think 

 6          if we could get the tenant rent increase 

 7          exemption program passed, that would help 

 8          needy people, because it's a rent freeze 

 9          program.  

10                 But I think we're done on our side.

11                 CHAIRMAN FARRELL:  Are they?  I'm just 

12          going to let the young lady ask a question 

13          down at the end, Ms. Niou.  To close.

14                 ASSEMBLYWOMAN NIOU:  Thank you so 

15          much.  

16                 It was just kind of a follow-up to 

17          some of the other questions that you've 

18          gotten.  Thank you so much for taking the 

19          time to answer all of our questions.  

20                 I know that NYCHA has been raised 

21          several times in this hearing, but I just 

22          wanted to echo concerns made by my colleagues 

23          regarding the state's role with NYCHA.  You 

24          know, I represent thousands of public housing 


 1          residents on the Lower East Side, and it is 

 2          critical that state funding be allocated.  

 3          And it is also, you know, very critical that 

 4          we allocate much more of it, and quickly.  

 5                 NYCHA is in dire need of repairs and 

 6          security upgrades.  And I urge HCR to really 

 7          think about how to move current and future 

 8          state funds for NYCHA as quickly as possible.  

 9          I know that this is especially relevant, 

10          given the Assembly's push right now to 

11          include about $500 million in this year's 

12          budget.  

13                 As many of my colleagues have stated, 

14          it is critical that we as legislators are 

15          able to push for NYCHA funds at the state 

16          level, knowing that they'll be spent 

17          efficiently, of course.  But at the same 

18          time, you know, one of the biggest questions 

19          that we've been facing right now is whether 

20          or not things will move quickly.  Because as 

21          you know, DASNY has been holding up the funds 

22          for a number of reasons.  And you know, we've 

23          gotten different answers for different 

24          questions.  And, you know, we have been 


 1          pushing and pushing and pushing for a release 

 2          for some of this funding.  

 3                 But, you know, also we need larger 

 4          amounts if we're able to -- you know, the 

 5          biggest pushback has been that, you know, 

 6          maybe we're not giving enough funds to DASNY 

 7          for certain projects.  And we heard that from 

 8          the Governor at the breakfast that we had 

 9          with him.  

10                 And so, you know, how do we remedy 

11          that unless we get more funding for them?

12                 COMMISSIONER RUBIN:  So, 

13          Assemblywoman, I agree with you that the need 

14          for urgency -- as we've talked about, 

15          everybody recognizes the need for funding for 

16          NYCHA.  I was at that breakfast with you, I 

17          heard his commitment, and I know that there 

18          is a process in place to accelerate that 

19          funding.  And I will be monitoring it.

20                 ASSEMBLYWOMAN NIOU:  Okay.  

21                 And then, you know, one more just 

22          quick thing.  Between 2013 and 2015, about 

23          359,000 people were evicted from 

24          rent-stabilized apartments.  This has surely 


 1          contributed to the homelessness crisis.  You 

 2          know, it's costing the state a lot of money, 

 3          and how can we strengthen rent stabilization 

 4          as a whole in order to stand up for tenants 

 5          and, you know, help the homelessness crisis 

 6          and also end evictions in New York?  

 7                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 8          Well, you know, as you know, that process 

 9          sort comes up through this legislative body 

10          every couple of years, and I think we have 

11          maybe two or three more years until that 

12          comes back up again.  

13                 But I think in the intervening time, 

14          we'd be happy to sit down with you and think 

15          about whether you think there's ways just 

16          sort of internally on our side, on sort of an 

17          administrative side, whether there's things 

18          we can be doing outside of that process.  

19          We'd be happy to talk through that.

20                 ASSEMBLYWOMAN NIOU:  So I hope that I 

21          can get your commitment to work with you on 

22          that.

23                 EX. DEP. COMMISSIONER VISNAUSKAS:  

24          Absolutely.


 1                 ASSEMBLYWOMAN NIOU:  Thank you so 

 2          much.

 3                 CHAIRMAN FARRELL:  Thank you.  Thank 

 4          you very much.

 5                 CHAIRWOMAN YOUNG:  Thank you.

 6                 COMMISSIONER RUBIN:  Thank you.

 7                 EX. DEP. COMMISSIONER VISNAUSKAS:  

 8          Thank you.

 9                 CHAIRWOMAN YOUNG:  Again, 

10          congratulations.  And we'll be talking.

11                 COMMISSIONER RUBIN:  Thank you so 

12          much.


14          Thank you.  Have a good day.

15                 SENATOR KRUEGER:  You too.

16                 CHAIRMAN FARRELL:  Duncan Barrett, 

17          executive board member, New York State 

18          Association for Affordable Housing.  

19                 CHAIRWOMAN YOUNG:  If we could have 

20          some order, please.  If you have 

21          conversations, please take those outside.

22                 It's great to see you, Mr. Barrett.  

23          We appreciate your participation today.  As 

24          soon as we have some order, we can begin.


 1                 Okay.  We look forward to your 

 2          testimony.

 3                 MR. BARRETT:  Thank you, Chairwoman 

 4          Young, Chairman Cymbrowitz, and members of 

 5          the Joint Legislative Budget Committee for 

 6          this opportunity to participate in today's 

 7          hearing on the '17-'18 New York State housing 

 8          budget.

 9                 My name is Duncan Barrett.  I'm the 

10          president of Beacon Communities Development 

11          in New York and the past president of the 

12          New York State Association for Affordable 

13          Housing.  NYSAFAH's 375 members include 

14          not-for-profit and for-profit developers, 

15          lenders, investors, attorneys, and architects 

16          and others active in the financing and 

17          construction and operation of affordable 

18          housing across New York State.  Together, 

19          NYSAFAH's members are responsible for most of 

20          the housing built in New York State with 

21          federal, state, and local subsidies and 

22          incentives.  

23                 Out of respect for the speakers to 

24          follow me, I will try to be brief and just 


 1          hit a few points.  You have our written 

 2          testimony.  

 3                 We are very proud at NYSAFAH to be a 

 4          part of a coalition of prominent housing 

 5          organizations that have worked together to 

 6          pursue a greater commitment on the part of 

 7          the government.  And we're thankful to you, 

 8          the Legislature, and the Governor for the 

 9          evidence of that commitment with the proposed 

10          '17-'18 budget.  

11                 Like Chairman Farrell, I was around at 

12          the beginning of the Neighborhood 

13          Preservation Program and remember he and his 

14          staff's great work to bring that program to 

15          fruition.  And that was foundational, 

16          Chairman Farrell, in my career.  So thank you 

17          for that.  

18                 You all know that New York has a 

19          housing crisis, a crisis of affordability.  

20          Over 300 million households -- not people, 

21          households -- are rent-burdened across the 

22          state, and half of those, a million and a 

23          half households, pay a staggering 50 percent 

24          or more of their income for housing.  On any 


 1          given night, more than 80,000 people in 

 2          New York are homeless in New York State, and 

 3          many of those are children.  

 4                 I am impressed with the thoroughness 

 5          with which you've conducted this hearing, and 

 6          I appreciate very clearly your commitment to 

 7          affordable housing.  So I don't think I'm 

 8          telling you anything that you don't already 

 9          know, and I won't waste your time repeating 

10          platitudes.  

11                 This crisis is not only limited to 

12          very-low- and low-income New Yorkers but now, 

13          as we've said earlier, extends to 

14          middle-income families as well.  So the new 

15          programs that are proposed for the 

16          $2.5 billion address multiple needs, and it's 

17          important that each of these needs -- from 

18          middle-income housing to senior housing, 

19          importantly, supportive housing, multifamily 

20          housing preservation, the CIF, and the RAD 

21          program -- are all funded, and we are 

22          encouraging you to do that.  

23                 We want you to know this from the 

24          industry's point of view, the housing 


 1          development industry's point of view, that 

 2          NYSAFAH and its members of the housing 

 3          coalition are ready to build and rehabilitate 

 4          the needed housing to the extent that the 

 5          public subsidies that we are discussing are 

 6          available.  

 7                 I know that there is a capacity issue 

 8          that you've raised underlying several of the 

 9          questions that were put forth to the agency 

10          staff earlier.  This state has an admirable 

11          and unique track record as a leader of the 

12          affordable housing industry for over six 

13          generations -- over six decades, excuse me, 

14          not six generations -- and we have the 

15          capacity to perform.  And the resources that 

16          you are envisioning and discussing will make 

17          that performance possible.  

18                 I also want to address one other 

19          issue.  There was a question earlier of the 

20          commissioner about the need for 

21          multiyear commitments, and I can tell you 

22          from my personal experience -- and I've 

23          developed over 6,000 units of affordable 

24          housing in the 40-plus years I've been doing 


 1          this -- these projects take years to put 

 2          together, and that's not just true in the 

 3          City of New York, it's true in upstate as 

 4          well.  So multiyear commitments on the part 

 5          of the Legislature and the Executive will 

 6          actually lead to more cost-efficiencies and 

 7          more efficient production.  

 8                 We often work two or three years on a 

 9          project before we're even in a position to 

10          apply for funding, so that extended 

11          commitment is necessary.  

12                 And my last point, besides to thank 

13          you again for your commitment to affordable 

14          housing in this state, is to point out that 

15          housing authorities across the state are 

16          broken.  It is not just the City of New York, 

17          although the City of New York's is the most 

18          significant housing authority in the state, 

19          but our company is partners with six separate 

20          housing authorities, from Rockville Center to 

21          Rome, and we've worked through the 

22          re-creation of close to 1,000 units of public 

23          housing in upstate New York.  Upstate housing 

24          authorities are in dire straits as well.  


 1          Public housing in this whole country is 

 2          broken.  

 3                 As the commissioner, the outgoing and 

 4          the incoming commissioners said earlier, we 

 5          really need to look at ways to recreate 

 6          public housing and reinvent public housing, 

 7          and New York should be the leader in that 

 8          reinvention.  The RAD program is an important 

 9          component, but it's not the only tool.  And 

10          just putting money into the broken system is 

11          not going to actually yield long-term 

12          benefits.  

13                 Thank you.

14                 CHAIRWOMAN YOUNG:  Thank you, Duncan.  

15                 And just to remind you, thank you for 

16          summarizing.  But your written testimony 

17          becomes part of the permanent record, and we 

18          do refer to that during budget negotiations 

19          and the whole process.  

20                 But I want to sincerely thank you and 

21          your members for everything that you do to 

22          develop affordable housing in the state.  

23          It's just such a crucial mission, so thank 

24          you.


 1                 MR. BARRETT:  It's our joy and our 

 2          mission.  Thank you, Senator.

 3                 CHAIRWOMAN YOUNG:  Thank you.

 4                 CHAIRMAN FARRELL:  Thank you.  

 5                 Questions?  

 6                 Have a good day.  

 7                 MR. BARRETT:  Thank you.

 8                 CHAIRMAN FARRELL:  Paul Gilbert -- 

 9          Paula Gilbert, executive director, 

10          Neighborhood Preservation Coalition of 

11          New York State.  And they also have Cara Long 

12          Corra, outreach manager.  

13                 MS. GILBERT:  I was going to introduce 

14          her, but that's okay.

15                 Good afternoon, I'm Paula Gilbert --

16                 CHAIRMAN FARRELL:  I'm a slow reader, 

17          you know.

18                 MS. GILBERT:  -- and I'm joined by 

19          Cara Long Corra, and we represent the 

20          Neighborhood Preservation Coalition of 

21          New York State.  

22                 Before we begin, we'd like to thank 

23          Chairman Farrell, Chairwoman Young, Chairman 

24          Cymbrowitz, as well as the members of the 


 1          Senate Finance and Assembly Ways and Means 

 2          Committees and the Senate and Assembly 

 3          Housing Committees, and the distinguished 

 4          members of the Legislature for this 

 5          opportunity to present testimony on behalf of 

 6          the Neighborhood Preservation Coalition and 

 7          its membership of over 150 MPCs, LDCs, and 

 8          CHDOs.

 9                 MS. LONG CORRA:  Okay.  So a lot has 

10          been said about the affordability crisis that 

11          we have in New York State, and we certainly 

12          don't dispute that.  But there's also a 

13          crisis of access.  And so providing funding 

14          for programs such as the N/RPP, Main Street, 

15          Low Income Housing Trust Fund, AHC, HOPE 

16          RESTORE, Access to Home and others, 

17          represents an effective and efficient 

18          investment in our state, as the appropriated 

19          dollars help not only to answer unmet housing 

20          needs but also to spur economic development.  

21                 So we're happy to see that the 

22          NPP-proposed funding for in the Executive 

23          Budget has remained consistent with last 

24          year, and that's $8,479,000 from the excess 


 1          reserves of the MIF.  And we're thankful that 

 2          JPMorgan Chase settlement funds are included 

 3          in the proposed budget to support the 

 4          activities of our preservation companies.  

 5                 Last year, however, there was a 

 6          legislative add -- which we'd like to again 

 7          say thank you for -- and we'd like to see 

 8          that add again this year if possible.  The 

 9          preservation companies have a critical need 

10          for stable funding as even small reductions 

11          affect and reduce their ability to deliver 

12          services and programs.  

13                 So those of you on Senate and Assembly 

14          Housing Committees and members with NPCs 

15          located in their districts have already heard 

16          from us this year and have an idea of what 

17          housing programs and policies we believe are 

18          critical to help revitalize our communities 

19          and maximize economic growth in the state.  

20          Neighborhood Preservation Program funding 

21          helps to support a wide range of services 

22          that articulate solutions to our most 

23          critical housing challenges, from repair and 

24          rehabilitation to affordable housing 


 1          development to tenant advocacy and 

 2          landlord-tenant mediation, Main Street 

 3          revitalization, and beyond -- our 

 4          preservation companies do all of that.  

 5                 Right now, however, many of our 

 6          neighborhoods and communities are under 

 7          threat.  Residents can't afford their housing 

 8          costs, and as such their connection to 

 9          community economic development efforts is 

10          strained.  If we are to agree that the road 

11          to economic prosperity begins in our 

12          neighborhoods, then we must ensure that 

13          preservation companies have the resources 

14          they need to expand this prosperity in their 

15          respective communities.  We must ensure they 

16          have adequate and stable funding that allows 

17          them to continue to revitalize our 

18          Main Streets, house our families, employ the 

19          disconnected, and protect the vulnerable, 

20          including children and frail seniors.  

21                 To demonstrate the power of the 

22          network, we're going to share some brief NPC 

23          success highlights with you.  In Buffalo, our 

24          NPCs are working to revitalize downtown 


 1          neighborhoods by aiding in commercial 

 2          revitalization and reducing surrounding 

 3          vacancy and blight.  In Rochester, they are 

 4          expanding access to healthy food while 

 5          supporting local farmers and their local 

 6          economy.  In Brooklyn, NPCs are creating jobs 

 7          for low-income women and helping individuals 

 8          and families create and maintain economic 

 9          self sufficiency.  And all of our NPCs, all 

10          143, are working to expand housing 

11          opportunities for low- and moderate-income 

12          residents of our state.

13                 So there's no shortage of examples 

14          from every corner of the state that 

15          demonstrate the ability of preservation 

16          companies to create more vibrant and livable 

17          communities.  

18                 I'm going to turn it back over to my 

19          colleague Paula, who's going to talk more 

20          specifically about our budget concerns.

21                 MS. GILBERT:  Thanks, Cara. 

22                 We are pleased that the Executive 

23          Budget includes a $10 million increase for 

24          the Housing Trust Fund and keeps funding 


 1          stable for the Main Street program.  However, 

 2          we believe that programs like AHC, Access to 

 3          Home, and HOPE RESTORE must be funded at 

 4          higher levels.  These programs are well 

 5          subscribed and successful vehicles for 

 6          expanding and preserving home ownership and 

 7          home ownership opportunities in New York.  

 8                 This year the coalition is asking for 

 9          a $10 million increase to AHC, a $4 million 

10          increase to Access to Home, and a $1 million 

11          increase for HOPE RESTORE.  As we have the 

12          second-lowest homeownership rate in the 

13          nation, we must do more to help create and 

14          support sustainable home ownership, and these 

15          programs are designed to do that.

16                 The 2017-'18 budget also contains a 

17          proposed increase to the Rural and Urban 

18          Community Investment Fund of $1 million over 

19          what was proposed but not enacted last year.  

20          The CIF is designed to empower locally based 

21          nonprofits to address the specific needs of 

22          their communities.  The most recent award 

23          information available for the year 2015 shows 

24          that 10 awards, totaling $10 million, remain.  


 1          Only one project of under 25 units was funded 

 2          through the CIF, and nine out of 10 awards 

 3          also received low-income housing tax credits 

 4          and eight received Housing Trust Fund awards.  

 5                 Larger developers therefore have these 

 6          programs as vehicles to help leverage CIF 

 7          funding, but there's no such vehicle for 

 8          smaller nonprofit community-based developers.  

 9          As such, we respectfully request that the 

10          Legislature consider making a suballocation 

11          of $9 million to the Office of Community 

12          Renewal to ensure that nonprofit, 

13          community-driven developers can be 

14          competitive within the CIF program now and 

15          into the future.

16                 Our coalition believes it's imperative 

17          for New York State to make strategic 

18          investments in our state's housing.  Access 

19          to stable, safe, affordable housing improves 

20          the health of our residents and our 

21          communities.  It boosts educational outcomes 

22          for our children, and it helps spur economic 

23          growth.  Affordable housing therefore acts as 

24          a vaccine in our communities, helping to 


 1          prevent larger problems that threaten our 

 2          livelihood and well-being.  

 3                 In business, conventional wisdom says 

 4          that you should invest resources in current 

 5          clients because keeping them is invaluable to 

 6          your success.  We believe that this wisdom 

 7          translates, and that New York State must make 

 8          strategic investments in housing for its 

 9          residents because it is crucial to their and 

10          to our success.

11                 N/RPCs are in a unique position to 

12          help the state target these investments in 

13          areas where they're most needed and in ways 

14          that will help maximize the investments.  We 

15          must make sure that we are funding the right 

16          programs at the right levels.

17                 Thank you.  Questions?

18                 CHAIRMAN FARRELL:  Thank you.  

19                 Questions?  Mr. Mosley.

20                 ASSEMBLYMAN MOSLEY:  Thank you, 

21          Mr. Chair.  

22                 Thank you, ladies, for your testimony.

23                 I know that Senator Young had brought 

24          up questions about the Recent Graduate Home 


 1          Buyer Program.  Do you think that's a program 

 2          that's going in the right direction, 

 3          particularly in our non-downstate region 

 4          where we want to make sure that we keep the 

 5          intellectual property at home as opposed to 

 6          going elsewhere?

 7                 MS. LONG CORRA:  I have to admit, I 

 8          had enormous difficulty hearing that.

 9                 ASSEMBLYMAN MOSLEY:  Okay, I'm sorry.

10                 MS. LONG CORRA:  It came through 

11          muffled.

12                 ASSEMBLYMAN MOSLEY:  Sorry.

13                 The Recent Graduation Home Buyer 

14          Program -- Senator Young had talked about it 

15          recently, in the last testimony.  Can you 

16          give us your input in terms of that program 

17          as it stands now and what improvement you 

18          think should be added to it or be retracted 

19          from it?

20                 MS. LONG CORRA:  I think we have a 

21          great need to support existing homeowners and 

22          then to work from there out in, say, 

23          concentric circles to expand homeownership.  

24                 The most recent data that we saw was 


 1          that Gen-Xers and baby boomers are the ones 

 2          leaving the state due to issues, you know, 

 3          with high taxes and retirement and whatever.  

 4          And those houses may not be getting 

 5          purchased.  So we want to do something to 

 6          keep them here and then generally encourage 

 7          more homeownership amongst younger people 

 8          where it has fallen off.  So I think, you 

 9          know, there are many things we can look at 

10          that would be strategic, but there has to be 

11          a constellation of programs.

12                 ASSEMBLYMAN MOSLEY:  Okay.  And then 

13          the 421-a -- I know you didn't allude to this 

14          in your testimony -- can you give me an 

15          assessment as to your analysis as to the big 

16          taxable giveaway we're giving in terms of 

17          added taxable revenue we're going to lose as 

18          a state and what you think, as advocates in 

19          this industry?  What can be done to improve 

20          that program going forward?  I know it's 

21          called the Affordable New York Act, but I 

22          don't think it's too affordable for anyone.

23                 MS. GILBERT:  So I'm the first one to 

24          admit that I am no 421-a scholar.


 1                 MS. LONG CORRA:  Or Affordable 

 2          New York, whichever --

 3                 MS. GILBERT:  So I would say that it's 

 4          obviously very complex.  And I think we need 

 5          to make sure that we're balancing the needs 

 6          of both, you know, tenants that clearly need 

 7          to have safe, affordable housing -- that 

 8          they're not going to be under a threat 

 9          constantly.  

10                 But I do believe that there are 

11          probably -- we do need to consider the fact 

12          that there probably needs to be some kind of 

13          tax incentive to do that.  Again, I'm not an 

14          attorney, so I'm not 100 percent, you know, 

15          sure --

16                 MS. LONG CORRA:  And many of our 

17          groups aren't at that level.  What they're 

18          developing wouldn't be eligible, wouldn't 

19          be -- formerly 421-a --

20                 MS. GILBERT:  Yeah, we have a lot of 

21          different-sized NPCs, so some of our smaller 

22          developers -- like, this is not going to be 

23          an issue for them.

24                 ASSEMBLYMAN MOSLEY:  Thank you.


 1                 CHAIRMAN FARRELL:  Questions from this 

 2          side?

 3                 CHAIRWOMAN YOUNG:  Thank you for all 

 4          that you do.

 5                 CHAIRMAN FARRELL:  Oh, no, one more.

 6                 Mr. Kavanagh.  

 7                 ASSEMBLYMAN KAVANAGH:  Yeah, I won't 

 8          take up much time.  I just wanted to take a 

 9          moment to thank you for your testimony and 

10          for the good work that so many of your member 

11          organizations do.  

12                 I work very closely with the Cooper 

13          Square Committee in the Lower East Side, and 

14          the Lower East Side Coalition Housing 

15          Development and MFY and other stuff.  Just -- 

16          I've taken up a lot of time this morning, but 

17          I just wanted to say thank you for your 

18          testimony and for your advocacy for 

19          continuing funding of these programs.

20                 MS. GILBERT:  I love to hear that.  

21          Our groups do really, really good work with 

22          not a lot of funding.  It's pretty amazing 

23          what they're doing across the state.

24                 MS. LONG CORRA:  And we're happy to 


 1          represent them.

 2                 MS. GILBERT:  I hope all of you enjoy 

 3          the housing cards that you all received.

 4                 ASSEMBLYMAN KAVANAGH:  I agree, so 

 5          thank you.

 6                 MS. GILBERT:  Thank you so much.

 7                 CHAIRWOMAN YOUNG:  Senator Krueger 

 8          does have one question.

 9                 SENATOR KRUEGER:  You thought you'd 

10          get away --

11                 (Laughter.)

12                 SENATOR KRUEGER:  I got triggered.

13                 MS. LONG CORRA:  It's not the weekend 

14          yet.

15                 SENATOR KRUEGER:  So at least for the 

16          New York City groups, because the mayor has 

17          just announced his plan to provide funding to 

18          guarantee legal representation for everyone 

19          in housing court, I'm curious how you think 

20          that might impact both the kinds of work your 

21          organizations are asked to do and, perhaps 

22          more importantly, the impact on perhaps 

23          helping to stabilize some communities where 

24          there is actually enormous effort to evict 


 1          poor people.

 2                 MS. GILBERT:  The mayor's step is a 

 3          step in the right direction.  A lot of our 

 4          groups in the city have specific employees 

 5          that help people in housing court, and they 

 6          are constantly slammed.  I mean, they have 

 7          hundreds of people that come in every single 

 8          day asking for help.  I know even that a lot 

 9          of times even tenants who will call the 

10          Assembly offices, they'll turn around and 

11          say, Hey, I know somebody who can help you 

12          with this.

13                 I think that it's important that we 

14          even the playing fields, so the idea that 

15          there is legal representation for each tenant 

16          that's going through an eviction proceeding 

17          is super-important.  But at the same time, we 

18          have members that do this all the time that 

19          aren't attorneys, that probably -- that are 

20          pretty amazing at this, that they might 

21          actually understand the laws more than I 

22          guess another person would.

23                 MS. LONG CORRA:  And I would say legal 

24          representation is of course important, it 


 1          reduces the number of evictions.  And when 

 2          you look at -- evictions cost a lot of money.  

 3          And not just that they cost a lot of money, 

 4          they disrupt families.  But we've also -- we 

 5          don't want to just put money on providing 

 6          legal services, we want to prevent the 

 7          conditions that force people into having to 

 8          have those services in the first place.  

 9                 So yes, they need to be there right 

10          now because those conditions exist.  But we 

11          need to look at ways where we can alleviate 

12          those conditions.  So we're not putting money 

13          there, we're actually making investments in 

14          the people to eliminate that problem.  We 

15          really want to see housing be on a prevention 

16          agenda.

17                 SENATOR KRUEGER:  Right.  So I would 

18          urge you to sit down as a coalition with 

19          members -- with the universe of people who 

20          will have expanded funding for legal service, 

21          and develop a new model of triage so that you 

22          can use your limited resources not to try to 

23          rush in to do paralegal representation --

24                 MS. GILBERT:  Right.


 1                 SENATOR KRUEGER:  -- but to free up 

 2          your people to do the longer-term stability 

 3          preservation, which I think you are better 

 4          at.  

 5                 And I speak from a little experience, 

 6          because prior to being a Senator I actually 

 7          ran a pretty big eviction prevention model 

 8          program under contract with the City of 

 9          New York, in five sites in two boroughs, and 

10          that's what we did at the time.  We were not 

11          lawyers, but we did a model of triage with 

12          Legal Aid/legal services so that people who 

13          came to them who really needed lawyers got 

14          lawyers; people who came to them and really 

15          needed other kinds of services, perhaps more 

16          like what you're doing, got sent to us, and 

17          vice versa.  

18                 And it actually worked very 

19          effectively, so that you were distributing 

20          the best-needed resources the right way.  But 

21          it only works if you sit down and you work it 

22          out.

23                 MS. LONG CORRA:  Yup.

24                 MS. GILBERT:  I agree.


 1                 SENATOR KRUEGER:  So I hope that 

 2          that's what you do.

 3                 MS. LONG CORRA:  Collaboration's the 

 4          way forward.

 5                 MS. GILBERT:  Yup.  Thank you.  

 6                 SENATOR KRUEGER:  Thank you.

 7                 CHAIRWOMAN YOUNG:  Thank you for all 

 8          that you do.

 9                 CHAIRMAN FARRELL:  Thank you.

10                 MS. GILBERT:  Thank you, Senator.

11                 CHAIRMAN FARRELL:  Supportive Housing 

12          Network of New York, Maclain Berhaupt, state 

13          advocacy director.

14                 SENATOR KRUEGER:  And yet it's not 

15          Maclain.

16                 MS. MASCUCH:  It's not Maclain.  We 

17          are -- Maclain -- we're just hoping she gets 

18          through the hearing without going into labor.

19                 But thank you so much.  Thank you, 

20          Senator Young, Assemblymember Farrell.  And 

21          Assemblymember Cymbrowitz, nice to see you 

22          again.  Congratulations.

23                 My name is Laura Mascuch, and I'm the 

24          executive director of the Supportive Housing 


 1          Network of New York.  We're a membership 

 2          organization of over 200 nonprofit 

 3          organizations that build and operate 

 4          supportive housing.  We have over 

 5          50,000 units across the state, just a real 

 6          incredible investment.

 7                 I'm not going to read my testimony, 

 8          you have it in front of you, but just to hit 

 9          some highlights.  

10                 As you know, supportive housing is the 

11          most cost-effective and humane way to 

12          reintegrate homeless individuals and families 

13          back into the community.  Those individuals 

14          and families have disabilities such as mental 

15          illness, HIV/AIDS, substance abuse, and 

16          they're leaving very expensive systems.  

17          They're cycling in and out of shelter, 

18          prisons, and emergency rooms.  A recent study 

19          by the New York City Department of Health and 

20          Mental Hygiene showed us that once integrated 

21          back into the community in supportive 

22          housing, there was a net public savings of 

23          $10,100 per person per year.  So that is 

24          significant.  


 1                 As we know, the statistics are fairly 

 2          staggering right now around homelessness.  We 

 3          have roughly 83,000 men, women, and children 

 4          staying in shelters -- 70,000 of those are in 

 5          the City of New York, and another 13,000 

 6          outside of the city.  That includes 24,000 

 7          children.  

 8                 And really in response to this crisis, 

 9          and the fact that supportive housing 

10          drastically slowed from the past long-term 

11          support of housing commitments, the Governor 

12          announced last year in the State of the State 

13          speech that they would be creating 

14          20,000 units of supportive housing over the 

15          next 15 years, a really historic commitment.

16                 The long-term supportive housing 

17          program was part of the Governor's 

18          $20 billion, five-year affordable housing 

19          plan to build 100,000 units of housing as 

20          well as 6,000 units of supportive housing.  

21                 So unfortunately, I am here today to 

22          once again talk about this commitment, 

23          because we have not yet crossed the finish 

24          line.  Last year when the Governor proposed 


 1          his commitment, as you know, the 

 2          $1.97 billion was appropriated but subject to 

 3          a memorandum of understanding.  A year later, 

 4          homelessness is rising to record levels, and 

 5          there's an affordable housing crisis.  And we 

 6          still don't have a signed MOU really 

 7          committing the long-term funding to 

 8          affordable and supportive housing.  

 9                 At the very end of the legislative 

10          session, $150 million was appropriated, which 

11          enabled us to get started on the first 1,200 

12          units, which we were grateful for.  But as 

13          you know, supportive housing developers and 

14          investors and the nonprofits need a long-term 

15          financing commitment for future development.  

16                 In the past, the New York/New York 

17          agreements in the city and the state 

18          attracted investors because they diminished 

19          the risk by providing that long-term 

20          commitment up front.  So a fully funded 

21          five-year plan is critical to us moving 

22          forward.  

23                 What we now need is the Governor and 

24          the leaders of the Senate and the Assembly to 


 1          sign off on the MOU today.  That's still a 

 2          possibility from last year's budget.  But we 

 3          are happy to see that the funding has been 

 4          reappropriated in this year's budget, with 

 5          the additional $526 million.  

 6                 Homelessness among our most vulnerable 

 7          is a statewide problem, in both urban and 

 8          rural settings, and by working together we 

 9          create the housing the community needs for 

10          this population.  We urge your support.  

11                 Thank you so much for allowing me to 

12          testify today.

13                 CHAIRMAN FARRELL:  Thank you.

14                 Questions?  Mr. Cymbrowitz.

15                 ASSEMBLYMAN CYMBROWITZ:  Laura, thank 

16          you very much.  Great seeing you again.

17                 MS. MASCUCH:  Good to see you.

18                 ASSEMBLYMAN CYMBROWITZ:  I wanted to 

19          talk a little bit about the fact that the MOU 

20          has dollars appropriated -- 6,000 units over 

21          five years.  Why does the Supportive Housing 

22          Network feel it's important to have it spread 

23          out over five years?

24                 MS. MASCUCH:  So I think, if I'm 


 1          understanding you -- so the five-year 

 2          commitment for the 6,000 units, that is your 

 3          question?

 4                 ASSEMBLYMAN CYMBROWITZ:  Yeah.  Why is 

 5          it important to do it over five years?

 6                 MS. MASCUCH:  Right.  So it's 

 7          important over five years because the 

 8          nonprofits in particular need the long-term 

 9          commitment to actually procure the sites.  As 

10          you well know, it takes two to four years to 

11          develop supportive housing, and so the siting 

12          and the procurement and the purchase of the 

13          property as well as the development is 

14          multiyear.  And so really for the nonprofit 

15          boards, they need to know, if they're 

16          allowing their executive director to buy a 

17          property, that there will be funding over 

18          multiple years, so in case you've maybe just 

19          missed this application process with the 

20          state, you know there will be a next one, and 

21          you can feel comfortable that that property 

22          will be financed.

23                 ASSEMBLYMAN CYMBROWITZ:  Looking at 

24          those that can live in the supportive 


 1          housing, and we've run across many -- and 

 2          what I see left out in the most recent RFP 

 3          are seniors who now are developing dementia 

 4          and Alzheimer's.  As some of us get older, 

 5          that is something that we're finding more of.  

 6          Is that something that could be used using 

 7          the supportive housing model?  Is that 

 8          something that we can expand to?

 9                 MS. MASCUCH:  So currently -- 

10          actually, individuals over the age of 55 is a 

11          growing population in the shelter system, and 

12          they come with a lot of chronic needs.  We 

13          have probably, throughout the year, 7,000 to 

14          10,000 seniors that cycle in and out of the 

15          shelter system.  

16                 So they do come with a variety of 

17          health and mental health needs, and our 

18          supportive housing providers have become much 

19          more adept at integrating housing and 

20          healthcare to really support them.  If 

21          somebody was very sick with dementia, 

22          supportive housing would probably not be the 

23          appropriate place, because they might need 

24          24-hour care.


 1                 CHAIRMAN FARRELL:  Thank you.  

 2                 Senator?

 3                 CHAIRWOMAN YOUNG:  First of all, great 

 4          to see you.  Thank you so much for everything 

 5          that you do.  

 6                 And I just wanted to ask quickly about 

 7          a couple of things.  

 8                 One of the issues that is really 

 9          important to me, but it's important to a lot 

10          of people, is untreated mental illness.  And 

11          I know that you have served people -- and 

12          that is a contributing factor to 

13          homelessness.  And as you pointed out, 

14          homelessness is not just an urban problem, 

15          it's a statewide problem.  We have it in 

16          rural areas also.

17                 And the other issue that has really 

18          emerged over the past several years -- and 

19          it's always been there, but it's an exploding 

20          crisis right now, as you know -- is the 

21          opioid and heroin crisis.  And we've passed 

22          legislation, we've worked with -- the two 

23          houses have worked together, we've worked 

24          with the Governor, and we passed a really 


 1          comprehensive package last year.  We'd like 

 2          to do more.  But it's focusing on prevention, 

 3          treatment, recovery, and then the law 

 4          enforcement piece.  

 5                 But where I see a real deficit is in 

 6          the recovery piece.  Because you may be able 

 7          to get to treatment programs, not always, but 

 8          you -- oftentimes, you go back to the same 

 9          setting where you got addicted in the first 

10          place.  So it's kind of this vicious cycle, 

11          and I think that's where supportive housing 

12          could be very beneficial.  

13                 But when you look at the higher level 

14          of need in supportive housing, it seems like 

15          the model doesn't always work because people 

16          may, in recovery or with mental illness, may 

17          need a higher level.  And we're trying to 

18          establish a program for recovery in my 

19          district, and we can't seem to pigeonhole it 

20          where the funding works.  

21                 Have you run into that around the 

22          state, where there's a level in between and 

23          people are falling through the cracks and 

24          there doesn't seem to be a good solution?  


 1                 MS. MASCUCH:  Right.  I think one 

 2          thing that was positive in this being a 

 3          statewide agreement is that the state's plan 

 4          actually is addressing people that are at 

 5          risk of homelessness.  And so prior to this, 

 6          we had very structured silos of definitions 

 7          that people had to fit into, and it was 

 8          difficult, but that recovery population was 

 9          included.  And now that the state has kind of 

10          opened it up to at-risk as well, then it 

11          might be the answer to that population.  

12                 I mean, you're very, very correct that 

13          they need the supports to maintain the 

14          sobriety, and going back to the same persons, 

15          places, and things is not going to give them 

16          that support to really continue on the road 

17          of recovery.

18                 CHAIRWOMAN YOUNG:  Thank you.  I want 

19          to continue to work together.  There's a lot 

20          of important things to do, so thank you.

21                 MS. MASCUCH:  Thank you.  And thank 

22          you for your support, Senator.

23                 CHAIRWOMAN YOUNG:  Senator Krueger.  

24                 SENATOR KRUEGER:  Hi.  So you were 


 1          here earlier when the HCR people were 

 2          testifying?

 3                 MS. MASCUCH:  Yes.

 4                 SENATOR KRUEGER:  So this is a 

 5          confusion for me.  I agree, the MOU should 

 6          have been -- let me start again.

 7                 I don't like MOUs.  I continue to 

 8          argue that's in violation of state budget 

 9          law, but we do them anyway.  And the reason I 

10          don't like them is because there's no 

11          guarantee it's actually going to happen or 

12          happen the way anyone thinks it should 

13          happen.  So on the one hand, I'm like, oh, a 

14          little bit like I told you so.  

15                 But never mind that.  We didn't get 

16          the MOU signed.  The Governor has now put the 

17          money, line-itemed, into the new budget that 

18          we're discussing today, plus an additional 

19          $500 million.  This morning HCR talked about 

20          that really there's a pipeline and some 

21          amount of money started, and people are going 

22          forward even though that MOU never got 

23          signed, so it's not really a big deal if 

24          we're a year later in the five-year 


 1          process -- that's sort of how I was hearing 

 2          them -- to get things rolling.  

 3                 So what's true?  I mean, are we not a 

 4          year behind where we needed to be?  Are you 

 5          guys still rolling -- because you weren't 

 6          really going to be able to have shovel in the 

 7          ground, needing the money in the first four 

 8          months anyway, you know.  I'm just curious.

 9                 MS. MASCUCH:  Yeah.  No --

10                 SENATOR KRUEGER:  Where's reality?  

11          And are we going to get the full amount by 

12          Year 5 if we're doing 2.5 billion in Year 2 

13          and almost zero in Year 1?

14                 That's two questions.

15                 MS. MASCUCH:  So absolutely, there's 

16          repercussions.  If we were only doing one 

17          year of funding, then it's not going to be 

18          the way that we can count on it over the next 

19          five years in order to get it done.  

20                 And even now, the way that the ESSHI 

21          RFP came out, it came out right on top of the 

22          deadlines for the capital programs, and so a 

23          number of groups were not able to move very 

24          quickly because it was kind of a truncated 


 1          process.  So buildings that were in the 

 2          pipeline kind of benefited, but no one else 

 3          is in the pipeline.  

 4                 So with the end of New York/New York 

 5          III, we're really facing a cliff of no 

 6          development because we've had no new funding 

 7          committed, really, for the last three years.  

 8                 So this promise has continued to, you 

 9          know, go on and on with no actual dollars 

10          except for the 150 million, which was a very 

11          small part, as you know, of the 1.97 billion.

12                 SENATOR KRUEGER:  And what was your 

13          understanding of the five-year commitment for 

14          6,000 units?  Right, if you're not getting 

15          Year 1 money until Year 2, are you under the 

16          impression you're going to be able to still 

17          meet the 6,000-unit target within five years 

18          as long as we are putting the real money in 

19          and giving it to you?  

20                 And would we need more -- now, 

21          granted, it wasn't all for supportive 

22          housing, right?

23                 MS. MASCUCH:  Right.

24                 SENATOR KRUEGER:  But would we need to 


 1          put a guarantee of X amount in in Years 2, 3, 

 2          4, 5 to get to that target?

 3                 MS. MASCUCH:  Right.  So about 

 4          $1 billion of the 2.5 is for supportive 

 5          housing.  And that is allocated over the five 

 6          years.  And the additional money that they 

 7          added in, the 526, is actually for money that 

 8          was supposed to come in in 2020, so now it's 

 9          actually there.  

10                 So we feel fairly confident, if we can 

11          just get this plan appropriated and going, 

12          that we'll have the funding to actually build 

13          the 6,000 units.

14                 SENATOR KRUEGER:  Okay.  So we will 

15          have been late to get started, but if we 

16          could do it right we can still get to the 

17          target we had all thought we'd gotten to.

18                 MS. MASCUCH:  Right.  Correct.

19                 SENATOR KRUEGER:  Thank you.

20                 MS. MASCUCH:  Thank you.  

21                 CHAIRWOMAN YOUNG:  Thank you.

22                 CHAIRMAN FARRELL:  Thank you.  

23                 Next, Enterprise Community Partners.  

24          Judi Kende, vice president and New York 


 1          market leader.

 2                 MS. KENDE:  Good afternoon.  I want to 

 3          thank Chair Farrell, Chair Young, Chair 

 4          Little, and a special thank you and welcome 

 5          to the new housing committee chair, 

 6          Assemblymember Cymbrowitz.  We are so excited 

 7          to work closely with you on affordable 

 8          housing issues in New York, and laud what 

 9          you've done to date.

10                 My name is Judi Kende, and I lead 

11          Enterprise New York.  Enterprise is a 

12          national nonprofit organization that makes 

13          well-designed homes affordable for low- and 

14          moderate-income people.  Since the New York 

15          office opened in 1987, we have built or 

16          preserved more than 57,000 affordable homes 

17          for 150,000 New Yorkers, representing more 

18          than $3 billion invested.  

19                 For the sake of time, I'm going to 

20          abbreviate a little bit here, but I am so 

21          pleased to be joined by so many organizations 

22          representing affordable housing providers and 

23          community development groups from across the 

24          state.  


 1                 We're not only here on behalf of our 

 2          own organizations, but also on behalf of the 

 3          coalition of affordable housing stakeholders 

 4          who are united in advocating for the release 

 5          of desperately needed funding for housing.  

 6          And we're frustrated that we have been 

 7          promised these funds over and over to no 

 8          avail.  And like the others, I remind you 

 9          that it is not too late to sign the MOU.

10                 You have heard over and over the 

11          incredible need for affordable housing in the 

12          state.  Eighty thousand people in our 

13          homeless shelters; 1 million households in 

14          this state pay over half of their income on 

15          rent.  And you hear from your own 

16          constituents the dire need and the horrible 

17          tradeoffs between paying rent and getting 

18          medicine, keeping the lights on, and the 

19          struggles of people -- that the elderly and 

20          parents face.

21                 New Yorkers have a wide array of 

22          housing needs, and we are fortunate to have 

23          as many programs and experts in the field to 

24          help address them.  We support all funding 


 1          for the programs outlined in the 2017-2018 

 2          Executive Budget because we know that we must 

 3          provide housing for the most vulnerable 

 4          people in our state, struggling homeowners 

 5          and working families alike.  

 6                 I'd like to talk specifically about 

 7          three programs that are top priorities for 

 8          Enterprise:  Supportive housing, senior 

 9          housing with services, and public housing.

10                 The first program I'd like to 

11          highlight is supportive housing, and we 

12          applaud you all, the 173 Assemblymembers and 

13          26 Senators who signed the letter to 

14          Governor Cuomo asking him to commit state 

15          resources to create 20,000 units of 

16          supportive housing.  And in last year's State 

17          of the State speech, the Governor did just 

18          that.  But we are back this year anxiously 

19          awaiting the release that would lead to the 

20          6,000 units of supportive housing over five 

21          years.  We feel strongly that the commitment 

22          must be honored in the Executive Budget.

23                 Next, I'd like to discuss the 

24          incredible need for a statewide senior 


 1          housing program.  Currently 197,000 seniors 

 2          across the state are paying more than half of 

 3          their income on rent, and 43 percent of them 

 4          rely solely on Social Security.  We're asking 

 5          that funding for senior housing be included 

 6          in the Executive Budget to provide the 

 7          capital resources needed to build affordable 

 8          homes for elderly New Yorkers.  

 9                 And we believe it should be a 

10          dedicated affordable senior housing and 

11          services program that also includes an 

12          additional $10 million for resident service 

13          coordinators, similar to the successful HUD 

14          202 program to allow seniors to remain in 

15          their homes and avoid costly and undesirable 

16          outcomes like hospitalization or premature 

17          nursing home stays.  

18                 Finally, I urge the state to provide 

19          financial support for public housing.  We are 

20          pleased to see the commitment in the 

21          Executive Budget for both upstate and 

22          downstate housing authorities, and we suggest 

23          three parameters.  First, the $100 million 

24          should go directly to NYCHA, bypassing other 


 1          bureaucracies.  Second, the funding should be 

 2          allocated in one year instead of spread over 

 3          multiple years.  Third, the funding should go 

 4          for NYCHA's infrastructure needs, things like 

 5          roofs, elevators, and boilers.  They might 

 6          not make exciting ribbon-cuttings, but they 

 7          are essential to resident health and 

 8          well-being.

 9                 In addition to the overwhelming need 

10          for affordable housing funding, these 

11          programs are smart investments.  Affordable 

12          housing is financed and operated through 

13          proven, effective public-private 

14          partnerships, meaning funding from the state 

15          leverages other sources, such as private 

16          investment.  Affordable housing development 

17          creates jobs, both in construction and 

18          permanent building staff and property 

19          management, and generates local tax revenue, 

20          all while providing the most basic needs of 

21          your constituents -- a safe, quality, 

22          affordable home.

23                 For these reasons, Enterprise joins 

24          countless groups and communities from every 


 1          region of the state asking the Legislature to 

 2          lead on housing.

 3                 Thank you.

 4                 CHAIRMAN FARRELL:  Thank you very 

 5          much.  

 6                 Questions?

 7                 CHAIRWOMAN YOUNG:  Thank you.

 8                 CHAIRMAN FARRELL:  Mr. Cymbrowitz.

 9                 ASSEMBLYMAN CYMBROWITZ:  Thank you 

10          very much.  Thank you for the great work that 

11          Enterprise does.   

12                 I happen to agree with your 

13          priorities.  In particular, many of us in the 

14          Assembly agree with the importance of NYCHA 

15          funding and agree that it should be done not 

16          only in one year, but more money and funds be 

17          allocated.  

18                 Could you talk a little bit about what 

19          effect you think the new Trump administration 

20          will have not only on your priorities but the 

21          potential devastation to NYCHA if more funds 

22          are cut not only for their operating but for 

23          their capital as well?

24                 MS. KENDE:  This is a huge concern.  


 1          And when we look at the state of public 

 2          housing funding, it has at the federal level 

 3          decreased over the last several decades.  At 

 4          the same time -- quite dramatically -- at the 

 5          same time, that Section 8 has stayed still or 

 6          gone up slightly.  And I think that there's 

 7          really real concern that that trend 

 8          continues.  

 9                 And when you look at NYCHA and realize 

10          that that is a trillion-dollar asset that 

11          New York has, it's old infrastructure and we 

12          absolutely must preserve and maintain it -- 

13          it's the only long-term source of affordable 

14          housing, and so we are definitely concerned 

15          about it and feel it's a critical 

16          investment -- before it deteriorates any 

17          further.

18                 ASSEMBLYMAN CYMBROWITZ:  Thank you.

19                 SENATOR KRUEGER:  Thank you.

20                 CHAIRMAN FARRELL:  Thank you.  Have a 

21          good day.

22                 New York State Rural Advocates, 

23          Judy Eisgruber, president.

24                 MS. EISGRUBER:  Good afternoon.


 1                 CHAIRMAN FARRELL:  Good afternoon.

 2                 CHAIRWOMAN YOUNG:  Good afternoon.

 3                 MS. EISGRUBER:  On behalf of the 

 4          New York State Rural Advocates and the 

 5          New York State Rural Housing Coalition, thank 

 6          you for this opportunity to present our 

 7          thoughts about the impact of the proposed 

 8          2017-2018 Executive Housing Budget -- 

 9                 (Interruption.)

10                 MS. EISGRUBER:  -- on small towns 

11          and rural places across our state.  My name 

12          is Judy Eisgruber, I am the president of 

13          New York State Rural Advocates, and I am here 

14          also to apologize that Blair Sebastian was 

15          not able to make it today.

16                 CHAIRWOMAN YOUNG:  Tell him hello.

17                 MS. EISGRUBER:  I am also joined today 

18          by Colin McKnight.  Colin is the acting 

19          executive director of the New York State 

20          Rural Housing Coalition, and together we 

21          represent private and nonprofit 

22          organizations, developers and architects, 

23          engineers and accountants, that work to 

24          address affordable housing needs in these 


 1          rural communities.

 2                 Our interests are focused on the 

 3          small-scale, community-based approach to 

 4          affordable housing and community development.  

 5          At the community level, this approach has 

 6          been extremely successful, as you know from 

 7          the work our members have accomplished in 

 8          your own districts.

 9                 Affordable housing in rural regions of 

10          our state is in crisis.  Nearly 50 percent of 

11          rural renters pay more than 30 percent of 

12          their income to meet their housing needs, and 

13          a startling 14 percent of homeowners pay more 

14          than 50 percent of their income for housing 

15          costs.  

16                 As you know, rural New York's housing 

17          stock is old, with over a third having been 

18          built in 1939 or earlier.  And using U.S. 

19          Census data, the HAC -- the Housing 

20          Assistance Council -- has determined that 

21          there are over 288,000, or one-third of 

22          occupied housing units in rural New York that 

23          are deemed to be inadequate by virtue of 

24          condition or affordability.  


 1                 We want to remind everyone that over 

 2          71 percent of the rural housing stock is 

 3          occupied by owners, compared to a statewide 

 4          home ownership rate of 54 percent, and 

 5          therefore Rural Advocates are sensitive to 

 6          homeownership issues.  

 7                 Foreclosures continue at very high 

 8          levels, and the presence of zombie homes 

 9          threaten the safety and values of rural 

10          communities.  The Rural Preservation Program 

11          is now approaching 40 years of service and is 

12          still providing leverage and match of well 

13          over $30 for every dollar in funding 

14          provided.  

15                 When the program was created, it 

16          included a provision for what was then 

17          considered a statewide Super RPC to provide 

18          training and technical assistance to the 

19          RPCs.  That Super RPC is now the New York 

20          State Rural Housing Coalition, which has only 

21          grown in its importance as a resource for 

22          rural communities.  

23                 Rural Advocates recommends an increase 

24          of $690,000, to bring RPC funding to $100,000 


 1          for each group and to provide $250,000 for 

 2          the New York State Rural Housing Coalition.  

 3          Rural Advocates calls for an additional 

 4          $500,000 to support five new RPCs in 

 5          currently unserved rural areas of the state, 

 6          for a total request of $4.729 million from 

 7          the Mortgage Insurance Fund.

 8                 At this time I'd like to introduce 

 9          Colin, and he'll take it from here.  Thank 

10          you.

11                 MR. McKNIGHT:  I appreciate having the 

12          opportunity to share with you today some of 

13          the exciting things that are going on in the 

14          world of the Rural Preservation Companies and 

15          at the Rural Housing Coalition. 

16                 If I can share any unifying theme with 

17          you about the current state of the Rural 

18          Preservation Program, it is creativity.  We 

19          are seeing radically different programs and 

20          projects coming out of RPCs all across the 

21          state, and I am extremely proud of how the 

22          RPCs are responding to market challenges in 

23          new and exciting ways.  

24                 As an example, one of our RPCs has 


 1          redeveloped an abandoned factory in a small 

 2          city neighborhood into apartments and a 

 3          workspace for lower-income artists' families. 

 4          The completion of this project has profoundly 

 5          impacted the surrounding neighborhood, 

 6          bringing in new businesses and residents. 

 7          This RPC is not resting on its laurels, 

 8          though, as it is already working on its next 

 9          big redevelopment, the county poor house.

10                 Also, we are working with a trio of 

11          RPCs to develop a collaborative plan to 

12          rejuvenate hamlets and villages along 

13          Route 20 and Route 30 in Schoharie and Otsego 

14          counties.  The concept is to bring together 

15          the programmatic strengths from each of these 

16          agencies to bring transformative change to 

17          America's Main Street in New York.

18                 We are also assisting an RPC in the 

19          Finger Lakes to develop a homeless housing 

20          project in derelict downtown buildings in a 

21          small village.  This project has secured most 

22          of the funding needed to get underway, and we 

23          are assisting with the application for Rural 

24          and Urban Community Investment Funds to fill 


 1          the remaining budget gap.  This project has 

 2          already attracted new businesses to the 

 3          storefronts of the buildings in question.

 4                 Finally, we have nine RPCs that are 

 5          currently recruiting additional personnel 

 6          under the federal VISTA program.  The Rural 

 7          Housing Coalition is the program sponsor, and 

 8          the nine VISTA members will be placed with 

 9          RPCs all across the state, from the 

10          Hudson River to the shores of Lake Erie.  

11          These VISTA members will be working on 

12          research and grant-writing projects to allow 

13          the host agencies to increase their programs 

14          and services.  The VISTAs will also be 

15          working on improving digital media to improve 

16          public relations, develop disaster plans, and 

17          create operations manuals to improve the 

18          efficiency of the host agencies.  

19                 This program is valued at $315,000 in 

20          staffing support for the RPCs, and the 

21          coalition is very pleased that we can connect 

22          the participating RPCs to this resource.

23                 As you can imagine, finding new 

24          resources to support the work of the RPCS is 


 1          never-ending.  The Rural Housing Coalition is 

 2          grateful for the ongoing support of our RPC 

 3          technical assistance contract each year, but 

 4          the amount of the funding is simply not 

 5          enough to meet the need.  The coalition has 

 6          been somewhat successful in securing grants 

 7          from small foundations to help fill the gap. 

 8          We want to recognize the John Ben Snow 

 9          Foundation and the Community Foundation of 

10          South Central New York for their help with 

11          this important RPC support work.  However, 

12          foundation funds will never be sufficient to 

13          support our work with the RPCs.  

14                 Our industry is changing, so there are 

15          always new technical assistance needs.  Our 

16          leadership is graying, so we have to be 

17          concerned about succession planning.  In the 

18          last couple of years, we have lost many of 

19          the private consultants that worked in the 

20          housing rehab and community development 

21          field.  This has left many small villages and 

22          towns across the state with no access to 

23          guidance on how to tap into available federal 

24          programs such as CDBG and HOME.  Very small 


 1          communities simply can't afford to hire their 

 2          own community development staff.  

 3                 The Rural Housing Coalition can help 

 4          fill that information gap, but we are 

 5          restricted from doing so under our current 

 6          technical assistance contract, which is 

 7          limited to serving the needs of RPCs.  We 

 8          would like to suggest that the coalition is 

 9          ideally suited to serve the small 

10          municipalities across the state, if we can 

11          secure a similar TA contract targeted to 

12          small municipality needs.  

13                 In order to help those isolated 

14          communities, we are requesting an additional 

15          $100,000 from an appropriate source to 

16          support this new service this year.

17                 MS. EISGRUBER:  As Colin points out, 

18          one of the great strengths of the Rural 

19          Preservation Program is that RPCs have the 

20          freedom and flexibility to tailor their work 

21          plans to address pressing and often unique 

22          local needs.  

23                 One of those local needs that we are 

24          urging New York State government to do is to 


 1          provide $10 million to support the network of 

 2          mortgage foreclosure service providers 

 3          through the balance of this year and to 

 4          provide an additional $20 million for the 

 5          next full year of funding, for a total 

 6          funding request of $30 million.  As of 

 7          September 30th, we will no longer have the 

 8          Home Ownership Protection program funding 

 9          from the New York State Attorney General, it 

10          will be over, and October 1st we will have no 

11          funding for the program.

12                 So we thank you for your 

13          consideration, and thank you for having us 

14          here.

15                 CHAIRMAN FARRELL:  Thank you very 

16          much.

17                 CHAIRWOMAN YOUNG:  Thank you.  Please 

18          give our regards to Blair, number one.

19                 MS. EISGRUBER:  I will.

20                 CHAIRWOMAN YOUNG:  Number two, you've 

21          heard us ask this morning about some of the 

22          programs, but I also want to let you know 

23          that Senator Little, who is the chair of the 

24          Housing Committee in the Senate, is pushing 


 1          for additional funding for RPCs and NPCs.  

 2                 So thank you.

 3                 MS. EISGRUBER:  Thank you.

 4                 CHAIRWOMAN YOUNG:  So we'll see what 

 5          happens.  But just so you know.

 6                 CHAIRMAN FARRELL:  Thank you.

 7                 SENATOR KRUEGER:  Thank you.

 8                 CHAIRMAN FARRELL:  New York Housing 

 9          Conference, Rachel Fee, executive director.  

10                 And the next one will be Christie 

11          Peale, Center for NYC Neighborhoods, and then 

12          Edward Ubiera, Local Initiatives Support 

13          Corporation.  Will you come down to the front 

14          so -- you like how I got it out?  Come down, 

15          so then we can get it a little faster.  

16                 And from now on, can you give us a 

17          quick -- the document will be given, and it 

18          will end up in the records.  But it would 

19          move a little faster if you just give us a 

20          rundown of what you have here.

21                 MS. FEE:  Sure.

22                 CHAIRMAN FARRELL:  Summarize, as they 

23          say.

24                 MS. FEE:  Sure, I'd be happy to 


 1          summarize.  And I'll try not to repeat the 

 2          statements from -- other groups already made.

 3                 My name is Rachel Fee.  I am executive 

 4          director of the New York Housing Conference. 

 5          Thank you for the opportunity to testify, to 

 6          Chairs Little, Farrell, and Cymbrowitz and 

 7          other members of the Legislature.  

 8                 New York Housing Conference is a 

 9          nonprofit affordable housing policy and 

10          advocacy organization.  As a broad-based 

11          coalition, our mission is to advance city, 

12          state and federal policies to support the 

13          development and preservation of decent and 

14          affordable housing for all New Yorkers.

15                  Generally we are supportive of the 

16          housing priorities outlined in Governor 

17          Cuomo's budget to address statewide housing 

18          needs in a five-year affordable housing plan, 

19          including $2 billion of reappropriated funds. 

20          Almost a year has passed since the $2 billion 

21          was enacted in the 2017 budget.  We estimate 

22          that about 10,000 affordable housing units 

23          could have been financed during this period. 

24                 Given the severity of our affordable 


 1          housing crisis, we have been deeply 

 2          disappointed with each passing day that 

 3          leaders of the Legislature and the Governor 

 4          have failed to come to an agreement on the 

 5          housing plan MOU.  We now hope that 

 6          productive negotiations will take place in 

 7          advance of the April 1st budget deadline to 

 8          provide New York State's affordable housing 

 9          community certainty regarding the 

10          availability of funds and programmatic 

11          priorities, to ensure an adequate development 

12          pipeline is available to meet New Yorkers' 

13          dire need for affordable housing.  

14                 I'd also like to state that we urge 

15          lawmakers to separate affordable housing 

16          appropriations discussions from the 421-a tax 

17          abatement program in order to avoid any 

18          possible further delays of appropriations, 

19          which will only exacerbate our affordable 

20          housing crisis.

21                 So you have my written testimony, and 

22          I speak about the great need for affordable 

23          housing in the state, including some 

24          statistics on rent-burdened families, median 


 1          rent growing faster than household income, 

 2          our extremely low, emergency-level vacancy 

 3          rate.  And I also talk about homelessness.  

 4          As we've heard already, 80,000 New Yorkers 

 5          are homeless across the state.  We have the 

 6          second-highest state homelessness rate in the 

 7          country.

 8                 We think that the Governor's plan as 

 9          outlined provides a good framework for 

10          investment to meet many of these housing 

11          needs.  And specifically I'd like to 

12          highlight the need for senior housing as well 

13          as homelessness.  We're in support of the 

14          allocation for supportive housing, for senior 

15          housing, in addition to the allocation 

16          indicated in the Governor's budget proposal.  

17          We'd also like to see $10 million dedicated 

18          to a resident service coordinator program to 

19          ensure adequate and appropriate staffing for 

20          senior housing.

21                 Another top priority of ours is 

22          preservation of public housing.  Our public 

23          housing stock is deteriorating and in dire 

24          need of capital investment.  We support the 


 1          Governor's proposal for housing authorities' 

 2          capital funding outside of New York City, and 

 3          we think that the $100 million commitment for 

 4          NYCHA is sufficient for an annual commitment.  

 5          Given the significant capital backlog at the 

 6          New York City Housing Authority, we'd like to 

 7          see no less than $100 million annually in a 

 8          five-year commitment.

 9                 We would also like to point out that 

10          additional funds may be dedicated to 

11          statewide housing needs from the $1.7 billion 

12          in unallocated settlement funds which are 

13          outlined in the Governor's budget.  And this 

14          could ensure sufficient capital is available 

15          to achieve the Governor's affordable housing 

16          plan goals while also ensuring decent and 

17          healthy living conditions for NYCHA 

18          residents.  

19                 I'm going to summarize my final 

20          remarks here.  So in addition to the 

21          additional funding for NYCHA that we're 

22          seeking, we're also supportive of home 

23          stability support, a new rent supplement 

24          program to assist families in jeopardy of 


 1          homelessness, and in addition to this we're 

 2          supportive of efforts to support 

 3          homeownership, as indicated in the Governor's 

 4          budget.  

 5                 I'd like to add that we also want to 

 6          see continued support for foreclosure 

 7          prevention programs which are not included in 

 8          the Governor's budget.

 9                 We also recommend reforming the 

10          mansion tax to ensure dedicated funding for 

11          affordable housing programs.  This funding 

12          should be targeted towards -- reform should 

13          be targeted towards high-end luxury sales, 

14          especially for non-primary residences.  This 

15          new revenue can be used as a safeguard 

16          against anticipated federal cuts to housing 

17          programs.

18                 Overall, Governor Cuomo's budget 

19          provides a solid framework for investment and 

20          affordable housing across the state with a 

21          strategic vision to tackle a variety of 

22          important housing needs by using state 

23          funding to leverage additional public and 

24          private funding to build and preserve 


 1          affordable housing.  Of course, this effort 

 2          will create jobs and also spur economic 

 3          development in communities across the state.

 4                 Today I have offered recommendations 

 5          for important additions to this plan that 

 6          will better position the state to tackle 

 7          homelessness, plan for our growing senior 

 8          population, preserve valued public housing, 

 9          assist homeowners facing foreclosure, and 

10          prepare for potential federal cuts.  I hope 

11          the Assembly and Senate will consider 

12          adopting these policy priorities in the 

13          2018 budget.  

14                 Thank you for this opportunity.

15                 CHAIRMAN FARRELL:  Thank you.  

16                 Questions?

17                 CHAIRWOMAN YOUNG:  Thank you.

18                 CHAIRMAN FARRELL:  Mr. Cymbrowitz.

19                 ASSEMBLYMAN CYMBROWITZ:  Thank you, 

20          Rachel.

21                 Just a little clarification on the 

22          mansion tax proposal.  Are we talking about 

23          the state mansion tax, or are we talking 

24          about the new proposal by the mayor in which 


 1          he wants to use those funds for rental 

 2          assistance to seniors?

 3                 MS. FEE:  Yeah, so we would be 

 4          supportive of the mayor's program for having 

 5          another tier in the mansion tax.  And I would 

 6          say a third tier could even be proposed to 

 7          target even higher-end luxury sales to 

 8          provide a dedicated revenue source for 

 9          affordable housing.

10                 ASSEMBLYMAN CYMBROWITZ:  Okay.  Thank 

11          you very much.

12                 CHAIRMAN FARRELL:  Thank you.

13                 CHAIRWOMAN YOUNG:  Thank you.

14                 SENATOR KRUEGER:  Appreciate your 

15          work.  Thank you.

16                 MS. FEE:  Thank you.

17                 CHAIRMAN FARRELL:  Edward Ubiera, 

18          director of policy, Local Initiatives Support 

19          Corporation, LISC.  

20                 No, I jumped one.  Yes, come on down 

21          and I'll get the other one.

22                 Chris Peale is next.  I jumped over 

23          you.

24                 MS. PEALE:  Good afternoon.  


 1                 CHAIRWOMAN YOUNG:  Good afternoon.

 2                 SENATOR KRUEGER:  Afternoon.

 3                 MS. PEALE:  You have my written 

 4          testimony.  I guess I should have known it 

 5          would be afternoon by the time I got up here.  

 6                 So thank you for your time.  My name 

 7          is Christie Peale, executive director at the 

 8          Center for NYC Neighborhoods.  I would like 

 9          to thank Committee Chairs Young, Farrell, 

10          Little, and Cymbrowitz for holding today's 

11          hearing on the housing-related proposals in 

12          the Governor's Executive Budget. 

13                 I will be primarily speaking to the 

14          need for foreclosure prevention services 

15          funding, which you've heard about several 

16          times already.  But I also stand strongly 

17          with our coalition partners that you've heard 

18          from already:  Enterprise, the New York 

19          Housing Conference, SHNNY, and you'll hear 

20          from LISC next in calling for the release of 

21          the funds promised in the five-year, 

22          $2 billion housing plan.

23                 So the Center for NYC Neighborhoods 

24          promotes and protects affordable 


 1          homeownership in New York so that middle- and 

 2          working-class families are able to build 

 3          strong, thriving communities.  We were 

 4          established by public and private partners, 

 5          and we meet the diverse needs of homeowners 

 6          throughout New York State by offering free, 

 7          high-quality housing services.  

 8                 Since our founding we've served over 

 9          40,000 homeowners.  We have provided 

10          approximately $33 million in direct grants to 

11          community-based partners, and we have been 

12          able to leverage this funding to oversee 

13          another $30 million in indirect funding 

14          support.  Major funding sources include not 

15          only local sources, HPD and the City Council, 

16          but also in the past we've received funding 

17          from New York State Homes and Community 

18          Renewal, the Office of the Attorney General, 

19          and other public and private funders.

20                 Before diving into this year's budget, 

21          I'd like to acknowledge the incredible gains 

22          for New York homeowners realized in last 

23          year's legislative session.  The zombie 

24          property reforms, the establishment of the 


 1          Community Restoration Fund, improvements to 

 2          the state settlement conference law, and the 

 3          creation of the Homeowner Bill of Rights are 

 4          all a strong testament to the commitment of 

 5          New York's leadership to homeowners and their 

 6          communities.  We commend the Governor, the 

 7          Senate and the Assembly for your leadership 

 8          and dedication to this issue.

 9                 We are also greatly appreciative of 

10          the Governor's existing and pending reverse 

11          mortgage proposal, which would extend the 

12          protections of settlement conferences for 

13          senior homeowners in reverse mortgage 

14          foreclosures.  This is a very smart move, and 

15          it will ensure that vulnerable homeowners 

16          have the opportunity to learn about their 

17          rights and options, as well as get connected 

18          to legal assistance and other services,

19                 Despite these positive gains, we are 

20          disappointed to see that the 2017-'18 

21          Executive Budget does not include funding for 

22          foreclosure prevention services.  While 

23          they're included, they were once funded 

24          through the State Budget and administered by 


 1          HCR.  Since 2011, the program has been funded 

 2          and separately administered through the use 

 3          of one-time settlement funding.  And all of 

 4          that funding, as you heard earlier, will 

 5          permanently expire in 2017.

 6                 This funding is crucial to ensuring 

 7          that New Yorkers fighting to keep their homes 

 8          do not get cut off from attorneys and housing 

 9          counselors, and that robust services continue 

10          to meet the emerging needs of homeowners -- 

11          and particularly as there's been a recent 

12          spike in reverse mortgage foreclosures. 

13                 Therefore, we are proud members of the 

14          Protect New York Homes campaign, which we 

15          hope you all saw on Monday, giving out keys 

16          with hearts on them, explaining the current 

17          need for existing foreclosure services and 

18          the folks that have been hit very hard by the 

19          crisis and helped so far with existing 

20          funding.  

21                 The Protect New York Homes campaign 

22          seeks $30 million for HCR in foreclosure 

23          prevention funding over the next two years.  

24          Current funding expires in September 2017, so 


 1          we're respectfully requesting $10 million to 

 2          maintain services for the 2017-2018 fiscal 

 3          year, with $20 million needed to continue 

 4          services in 2018-2019.  

 5                 I'd just like to take a moment to 

 6          thank all the legislators who met with the 

 7          coalition on Monday and who took part in our 

 8          press conference, and everybody who has  

 9          currently expressed support for the funding 

10          so far.  We are greatly appreciative.

11                 There's some information in my 

12          testimony about the ongoing need of 

13          foreclosure prevention services.  I know 

14          those of you who serve homeowners know how 

15          dire the need is.  You've heard from your 

16          constituents, and you'll hear from other of 

17          our partners later today.  But I wanted to 

18          make sure that I focused on how impactful the 

19          services are, so I'm going to skip to the 

20          section that talks about how our services 

21          work.

22                 As Chair Cymbrowitz observed earlier 

23          today, housing services are not just about 

24          individuals, but they have a direct impact on 


 1          communities, and there's a real economic 

 2          impact as well.  And that's certainly the 

 3          case in homeownership services.  

 4                 So our service providers are there for 

 5          homeowners in every county, as you'll see in 

 6          the materials that we handed out earlier.  We 

 7          serve Western New York, Southern Tier, 

 8          Central New York, the Hudson Valley, 

 9          Long Island, New York City -- we're 

10          everywhere in New York State where there is a 

11          need.  

12                 We've developed incredibly strong 

13          expertise and a track record when it comes to 

14          helping homeowners in foreclosure.  In 2016, 

15          our network helped 26,000 families, at an 

16          average cost of $770 per home.  When we talk 

17          about all of the housing needs that are out 

18          there, I want us to think about foreclosure 

19          prevention services as a real opportunity to 

20          make a nominal investment that can prevent us 

21          having to spend a lot more money further down 

22          the line in other much more costly housing.

23                 So this, to me, is an opportunity for 

24          us to be penny-wise as opposed to 


 1          pound-foolish.  We can really keep people in 

 2          existing affordable housing now with this 

 3          nominal investment in critical services.

 4                 Obviously we need to be able to create 

 5          a continuum of housing opportunities, from 

 6          NYCHA to senior housing to Mitchell-Lama, but 

 7          we really need to be able to keep people in 

 8          their homes right now so we don't increase 

 9          the burden on other sources of affordable 

10          housing that we're trying to develop.

11                 Eight thousand of these families live 

12          in New York City; 18,000 live throughout the 

13          state.  Our call center that we run in 

14          partnership with this network took 9,000 

15          calls from homeowners throughout New York who 

16          are looking for help with their mortgages, 

17          and we helped homeowners obtain more than 

18          10,000 home-saving modifications.  That's 

19          just a huge impact.  

20                 And I wanted to talk about the impact 

21          not only on families, but it also helps 

22          tenants who might rent units in their homes.  

23          Obviously, we can intuit that the benefits of 

24          housing stability have a huge impact on 


 1          children, and affordable modifications puts 

 2          money back in our communities, right?  These 

 3          are dollars that can now be spent in our 

 4          cities and towns across the state.

 5                 An average loan modification saves the 

 6          homeowner S600 per month.  For the 2,600 

 7          New York City homeowners who obtained 

 8          modifications in 2016, that represents a 

 9          savings of $1.5 million per month, or 

10          $18.7 million per year -- and that's in 

11          New York City alone.  That savings makes a 

12          huge difference for the working- and 

13          middle-class families we serve.

14                 The benefits also extend to 

15          neighboring properties.  In New York State, 

16          for every foreclosure averted, approximately 

17          $260,000 in equity is also saved for homes 

18          within 750 feet.  That's the aggregate 

19          property value that would have vanished if 

20          the homeowner had gone into foreclosure.  The 

21          figure varies around the state.  Depending on 

22          the density, in New York City the ripple 

23          effect could be $740,000; on Long Island, 

24          S280,000; in the Capital Region, that loss 


 1          could be $34,000.  So a home goes into 

 2          foreclosure, and the neighbors lose equity.

 3                 I want to make sure that you have a 

 4          chance to look at the testimony from the 

 5          Empire Justice Center that's been submitted 

 6          into the record.  They're a very -- they've 

 7          been leading the fight on our Protect 

 8          New York Homes:  Foreclosure Prevention 

 9          Services Work campaign, and they have a lot 

10          of information in their testimony as well 

11          about the economic impact of our work.

12                 One other point that's not in my 

13          testimony that I want to make sure to raise, 

14          the state has been fortunate to receive 

15          funding from the Goldman Sachs settlement for 

16          zero-percent foreclosure prevention loans for 

17          homeowners across New York State.  So this is 

18          a -- these are for homes that -- they can be 

19          used to save manufactured housing, homeowners 

20          that are at risk of losing their home due to 

21          a reverse mortgage, lots of other causes of 

22          default.  

23                 And the distribution of that funding 

24          is absolutely dependent on this network of 


 1          providers.  So not only will we lose the 

 2          impact to the families, we'll lose the impact 

 3          to the communities, we'll lose the 

 4          opportunity to leverage tens of millions of 

 5          dollars in these zero-percent loans that go 

 6          directly to homeowners across the state.

 7                 So I have additional information on 

 8          that program, it's called the New York State 

 9          MAP program.  And again, it helped homeowners 

10          in every part of the state in its previous 

11          iteration.  We have an opportunity to make a 

12          huge impact for New York State, but we really 

13          need the network of homeowner advocates in 

14          place to be able to make that funding go as 

15          far as it can go.  

16                 So I just wanted to close by saying 

17          thank you.  We really appreciate the great 

18          progress that we've made in tackling the 

19          foreclosure crisis in partnership with the 

20          legislators at the state.  But without this 

21          network, it's very difficult for homeowners 

22          and communities to take advantage of any of 

23          these resources.  For these reasons, we urge 

24          the Senate, the Assembly, and the Governor to 


 1          reach a state budget agreement that includes 

 2          $30 million for HCR for foreclosure 

 3          prevention services.

 4                 Thank you very much for the 

 5          opportunity to testify, and I welcome any 

 6          questions if you have them.

 7                 CHAIRMAN FARRELL:  Thank you.

 8                 CHAIRWOMAN YOUNG:  Thank you.

 9                 CHAIRMAN FARRELL:  Assemblywoman Niou 

10          to speak.

11                 ASSEMBLYWOMAN NIOU:  Hi.  Thank you.  

12          Thank you for coming and testifying.  

13                 I understand that your organization 

14          has been very involved with Hurricane Sandy 

15          recovery.

16                 MS. PEALE:  That's correct.

17                 ASSEMBLYWOMAN NIOU:  And particularly 

18          around assisting low- and middle-income 

19          homeowners.  I understand that insurance 

20          around these issues and natural disasters are 

21          really difficult to navigate around, and I 

22          commend you for that work.  

23                 So I represent Lower Manhattan --

24                 MS. PEALE:  Yes.


 1                 ASSEMBLYWOMAN NIOU:  -- which was 

 2          impacted a lot by Hurricane Sandy and has a 

 3          high concentration of renters as well as 

 4          homeowners, particularly low-income residents 

 5          living in NYCHA properties.  What do you 

 6          think should be the state's priorities when 

 7          it comes to assisting both low-income and 

 8          middle-income homeowners and renters recover 

 9          from Hurricane Sandy and other natural 

10          disasters?

11                 MS. PEALE:  Thank you for that 

12          question.  

13                 I would just like to take an 

14          opportunity to recognize a program that the 

15          Governor's Office of Storm Recovery is 

16          administering called the Residential 

17          Technical Assistance Pilot Program.  Lower 

18          Manhattan is one of the pilot neighborhoods.  

19          And in partnership with Enterprise Community 

20          Partners, we're working with not only 

21          multifamily buildings but single-family 

22          property owners to understand their future 

23          costs around flood insurance.  

24                 So I greatly encourage any property 


 1          owners that might be interested in working 

 2          with that program to get in touch with us or 

 3          Enterprise and we'll help them get access to 

 4          an audit that can not only understand how 

 5          they can lower their flood insurance but 

 6          maybe offer future green opportunities as 

 7          well.

 8                 So that's one way in which the state 

 9          has shown great leadership in this area, and 

10          we're really happy to be partnering with them 

11          on that program.  I think future costs around 

12          flooding are going to be something we all 

13          need to work together to monitor, 

14          particularly given that the National Flood 

15          Insurance Program is up for reauthorization 

16          in 2017.  

17                 So I would just ask for your 

18          partnership as we work together to identify 

19          new opportunities and also just to leverage 

20          the opportunities we have right now to get 

21          the existing funding out, on the ground.

22                 ASSEMBLYWOMAN NIOU:  Absolutely.  One 

23          of the things that I have been discussing 

24          with a lot of my colleagues is the FEMA 


 1          drawdown and the lock-in funding.  How do you 

 2          think that -- how better can we move forward 

 3          with that?

 4                 MS. PEALE:  I'm probably not the best 

 5          person to answer that question on the spot, 

 6          but I can get back to you with some 

 7          additional information about the FEMA 

 8          drawdown.

 9                 ASSEMBLYWOMAN NIOU:  Great.  Thank you 

10          so much.

11                 CHAIRWOMAN YOUNG:  Thank you.

12                 Our next speaker is Edward Ubiera, 

13          director of policy for the Local Initiatives 

14          Support Corporation.

15                 Welcome.  Thank you for being here.

16                 MR. UBIERA:  Thank you.  

17                 Thank you, members of the joint fiscal 

18          committees, for the opportunity to testify 

19          here today in the matter of the proposed 

20          Executive Budget.  A special thanks to the 

21          committee chairs:  Chair Young, Chair 

22          Farrell, Chair Cymbrowitz.  And good to see 

23          you, Senator Krueger.  

24                 My name is Edward Ubiera.  I'm the 


 1          policy director for LISC's New York City 

 2          program, and I will be delivering testimony 

 3          on their behalf. 

 4                 LISC is a national nonprofit community 

 5          development financial institution supporting 

 6          local champions of equitable development with 

 7          financing, capacity building, and technical 

 8          assistance.  For almost 40 years, we've been 

 9          on the ground building affordable housing and 

10          improving communities in collaboration with 

11          mission-driven organizations, government 

12          partners, and corporate leaders.  We've 

13          helped rebuild neighborhoods across New York 

14          City by investing over $2 billion in capital, 

15          resulting in over 40,000 units of housing and 

16          2 million square feet of commercial space. 

17                 We also have a vibrant practice in 

18          Buffalo where, since 1998, we have deployed 

19          over $100 million in investments resulting in 

20          roughly 2,000 units of affordable housing.  

21                 At LISC we are keenly aware that there 

22          exists a crisis in housing affordability and 

23          supply throughout New York State impacting 

24          virtually all segments of society, including 


 1          working families, seniors, homeowners, 

 2          very-low-income renters in public housing, 

 3          and households experiencing hazardous living 

 4          conditions.  You've heard many of the 

 5          statistics from some of the other advocates:  

 6          50 percent of renters in the state being 

 7          rent-burdened; 80,000 persons sleeping in 

 8          shelters on any given night in the state; 

 9          unacceptably high waiting lists for senior 

10          housing; and public housing that has an 

11          aggregate unmet capital repair need 

12          throughout the state, not only in New York 

13          City, that is in the millions if not 

14          billions.

15                 We were proud to endorse the 

16          Governor's $20 billion five-year plan to 

17          create and preserve 100,000 units of 

18          affordable housing and 6,000 new units of 

19          supportive housing last year.  In our view, 

20          and relative to the housing needs felt across 

21          the state, we felt that this plan was 

22          appropriately ambitious in size and scope.  

23          And as members of this committee were aware, 

24          that enacted budget stipulated that housing 


 1          funds were to be authorized in accordance 

 2          with a memorandum of understanding once 

 3          programmatic guidelines were to be agreed to 

 4          by the Legislature and the Governor.  

 5                 Despite strong encouragement by the 

 6          affordable housing community, that 

 7          comprehensive MOU was not fully signed.  

 8          However, we are very heartened this year that 

 9          the capital commitments reflected in the 

10          proposed 2018 budget reflect our priorities, 

11          and particularly we are heartened to see that 

12          those priorities include supportive housing, 

13          new construction, preservation of low-income 

14          rental housing, new construction of senior 

15          housing, public housing, rehabilitation of 

16          public housing, as well as commitments for 

17          homeownership.  

18                 To supplement those capital 

19          commitments we would like to support our 

20          colleagues at LeadingAge and LiveOn and 

21          New York Housing Conference in proposing an 

22          allocation of $10 million for a new residence 

23          service coordinator program.  We agree with 

24          their assessment that service coordination is 


 1          a cost-effective measure to allow seniors to 

 2          age in place and avoid expensive nursing 

 3          homes.  

 4                 State capital funds are vitally 

 5          important in creating certainty and 

 6          predictability in the housing finance 

 7          marketplace.  Developers, lenders, and 

 8          investors cannot effectively set budgets for 

 9          site acquisition and construction if there is 

10          uncertainty on the availability of public 

11          subsidies.  By some estimates, in 2016 

12          roughly 1,000 new units of affordable housing 

13          were not planned or built in each month that 

14          the MOU was not signed.  Given the size and 

15          scope of the housing needs statewide, the 

16          certainty of a fully funded, multiyear 

17          housing plan is needed in order to develop 

18          the robust housing pipelines across the 

19          state.

20                 Further, the changing landscape at the 

21          federal level has also added additional 

22          urgency to clarifying state commitments of 

23          housing resources.  Likely cuts to 

24          non-defense discretionary spending may impact 


 1          HUD's budget.  Potential changes in federal 

 2          tax policy may impact the future of housing 

 3          credits.  Committing state resources now will 

 4          allow developers and lenders to plan ahead 

 5          and think creatively on how to plug funding 

 6          gaps resulting from changes in federal 

 7          policy.

 8                 In closing, we strongly encourage 

 9          state leaders to follow through on their 

10          commitment and reach an agreement to provide 

11          landmark plans for a robust, multiyear 

12          statewide housing plan.  

13                 Thank you.

14                 CHAIRWOMAN YOUNG:  Thank you, 

15          Mr. Ubiera.  

16                 Any questions from the Assembly? 

17                 Senator Krueger.  

18                 SENATOR KRUEGER:  Thank you.

19                 So LISC builds affordable housing.  A 

20          lot.

21                 MR. UBIERA:  Yes.  Well, we help 

22          finance it.

23                 SENATOR KRUEGER:  You help finance it.  

24                 I think your testimony is you have 


 1          helped finance $2 billion worth of housing in 

 2          New York City.

 3                 MR. UBIERA:  We facilitated that level 

 4          of investment.

 5                 SENATOR KRUEGER:  Thank you.  

 6                 Do you think it's a good business deal 

 7          to spend $100 to get $11 worth of affordable 

 8          housing?  And do you think we need to do that 

 9          in 2017?

10                 MR. UBIERA:  We haven't taken an 

11          official position on the Governor's proposal.  

12                 As some context, the mission-driven 

13          developers that have accessed our capital, 

14          our technical resources, typically have 

15          utilized other tax incentive programs like 

16          420-c or locally based tax incentive programs 

17          like J-51 or Article XI.  

18                 I would say that for any tax incentive 

19          program, there should be a balance between 

20          public benefit and fiscal impact.  So to the 

21          extent that those two are met in the 

22          Governor's proposal, I think that additional 

23          discussion is needed.  

24                 SENATOR KRUEGER:  And do you think if 


 1          we invited people like you, and Enterprise 

 2          was here and ANHD, I think, is coming -- if 

 3          we put you in a room and said, If you had 

 4          $2 billion a year of taxpayer money to build 

 5          affordable housing in New York City, do you 

 6          think you could come up with a better plan 

 7          than the one the Governor's proposed?

 8                 MR. UBIERA:  That's an exciting 

 9          proposal.  Certainly we would like to be 

10          invited to have that kind of discussion.  

11          So ...

12                 SENATOR KRUEGER:  Thank you.

13                 MR. UBIERA:  Thank you.  

14                 CHAIRWOMAN YOUNG:  Thank you.  I think 

15          we're done, so thank you for participating.

16                 Now I want people to come in the 

17          queue.  Because if you're going to speak, if 

18          you could come down closer, that would be 

19          helpful.

20                 But next we have John Broderick, 

21          senior policy analyst from LeadingAge 

22          New York.  

23                 Following Mr. Broderick will be 

24          NeighborWorks Alliance of New York State.  


 1          And following Hilary will be the Association 

 2          for Neighborhood and Housing Development.  So 

 3          if everybody could get ready, that would be 

 4          helpful.

 5                 Welcome, Mr. Broderick.

 6                 MR. BRODERICK:  Thank you very much.  

 7          I appreciate the opportunity to testify 

 8          today.

 9                 CHAIRWOMAN YOUNG:  We do too.

10                 MR. BRODERICK:  LeadingAge New York is 

11          part of a national organization of the same 

12          name that represents nonprofit providers of 

13          long-term care.  That includes nursing homes, 

14          assisted living, and independent senior 

15          housing -- which I'm here to talk about 

16          today -- and also continuing care retirement 

17          communities, home-and-community-based 

18          services, provider-sponsored managed 

19          long-term care plans.

20                 When I wrote my testimony I said that 

21          we were very pleased that there is 

22          $125 million over five years in the 

23          Governor's proposed budget.  But after 

24          hearing incoming Commissioner Visnauskas' 


 1          testimony, we're more than pleased, we're 

 2          elated and overjoyed that money is there.  

 3          And we encourage you to work to ensure that 

 4          that money stays in the adopted budget.

 5                 However, we would like to add there's 

 6          something that's missing in that proposed 

 7          budget, which is language that would create a 

 8          new program so that senior housing 

 9          applications were competing against other 

10          senior housing applications and not just in 

11          the whole pool.  

12                 We have been talking to staff about 

13          what that language might look like.  There's 

14          precedent over the past four or five years.  

15          There have been three or four new sections of 

16          the Private Housing Finance Law that have 

17          been added to target specific populations.  

18          We hope that you'll agree with us and ensure 

19          that that language in some form makes it into 

20          your one-house budgets and hopefully into the 

21          adopted budget and into law.  That's what we 

22          really think it will take to get developers 

23          back into the business of senior housing with 

24          the right kind of supportive services 


 1          necessary to serve our aging population.

 2                 The 10,000 people per day that have 

 3          been turning 65, that's been happening for 

 4          five years.  So now it's 10,000 people per 

 5          day turning 70.  And we've known this for a 

 6          long time.  We've known this is coming.  

 7                 Yesterday afternoon we sent an email 

 8          to all of your inboxes that has a link to a 

 9          report by the Bipartisan Policy Center called 

10          "Healthy Aging Begins at Home."  I will refer 

11          you to that, because it is chock-full of 

12          great information.  They did a ton of 

13          research, they have great findings that 

14          really articulate this problem, the 

15          demographic changes that our country is going 

16          through, and makes dozen of recommendations 

17          in a number of different areas.

18                 The main area is the affordable 

19          housing supply.  This report talks about 

20          there are 11.2 million extremely low income 

21          renters competing for 4.3 million affordable 

22          apartments; 2.6 million of those people are 

23          elderly households without children.  So in 

24          New York, in a place that is so heavily -- 


 1          the housing stock is so heavily multifamily, 

 2          that is even more acute.

 3                 So it's really time for us to have 

 4          policy catch up with these demographic 

 5          changes and really invest in senior housing 

 6          in a bigger way than we have before.  The HUD 

 7          Section 202 program, as you know, has been 

 8          the primary source of financing for 

 9          affordable senior housing for the past 

10          40 years in this country.  Unfortunately, the 

11          program was discontinued in 2011 as a new 

12          source of capital.  We're very thankful that 

13          the ongoing rental assistance has been 

14          continually funded, and that is going to be a 

15          big challenge over the next several years in 

16          Washington.  And we're working very closely 

17          with our partner organizations around the 

18          country to ensure that HUD continues to keep 

19          up that commitment.  

20                 But as a capital source for 

21          development of new housing, 202 is no longer 

22          there.  You know the importance of 202s 

23          because you have them in your districts and 

24          you've been there, and you probably have 


 1          friends and relatives who have been in those 

 2          202s.  We think they're not just a great 

 3          source of housing, but a great source -- a 

 4          great place to work with people to keep them 

 5          healthy and to keep them independent and out 

 6          of institutional settings, which as you know 

 7          are much more expensive.

 8                 So you've heard the term "housing is 

 9          healthcare."  You've heard that -- you know, 

10          you've heard this in the context of 

11          supportive housing for many years, and that 

12          could not possibly be more true when talking 

13          about the elderly population.  And while 

14          New York State has made tremendous strides in 

15          reducing Medicaid expenses by targeting 

16          prevention programs to currently high-cost 

17          Medicaid users, we just don't have such a 

18          program yet for people who are headed toward 

19          Medicaid-funded nursing homes.  We think that 

20          that solution is important and right at our 

21          fingertips.  

22                 Aging in place.  I think it's kind of 

23          a misused, overused term.  I've enjoyed it in 

24          this place with you, all morning here, for 


 1          the past four and a half hours, but --

 2                 (Laughter.)

 3                 MR. BRODERICK:  Senator Young, you 

 4          described the 80-year-old woman aging in 

 5          place in a deteriorated mobile home, and I 

 6          know there are people aging in place in 

 7          five-floor walkups in the South Bronx and in 

 8          Brooklyn, and I know that there are people 

 9          who are aging in place in large houses that 

10          they no longer need but don't have a place to 

11          move to.  

12                 So this Bipartisan Policy Center 

13          report talks about "aging with options," and 

14          I think it's a better term.  And we need to 

15          grow ourselves into that.  But in order for 

16          our seniors to be able to age in healthy and 

17          safe ways with options that really work for 

18          them and their families, we have some work to 

19          do here in New York and around the country.

20                 So I'm glad that several of my 

21          colleagues have mentioned already the 

22          resident service coordinator program that we 

23          have proposed.  About half of the 202s around 

24          the country have resident service 


 1          coordinators, people who are there on-site to 

 2          help people make use of social service and 

 3          healthcare systems so that they can remain 

 4          independent.  

 5                 We think it's time that New York State 

 6          create such a program.  Ten million dollars 

 7          will get us about 140 new residence service 

 8          coordinators.  A Medicaid-funded nursing home 

 9          bed is between $30,000 and $50,000 per year.  

10          We're proposing that the resident service 

11          coordinator program be $70,000 grants, and 

12          that means if one resident service 

13          coordinator keeps two people from going 

14          prematurely into a Medicaid-funded nursing 

15          home, they've paid for themselves.

16                 We think -- as in supportive housing, 

17          we think independent senior housing with 

18          services has tremendous potential for savings 

19          on the Medicaid and healthcare side of the 

20          budget -- not only in reducing premature or 

21          inappropriate entry into Medicaid-funded 

22          nursing homes, but also more effective use of 

23          primary care, reduction of hospitalizations 

24          and rehospitalizations, which is very common 


 1          among elders.  

 2                 So we're once again very happy about 

 3          the capital investment; we think there needs 

 4          to be a program.  We think that capital 

 5          program needs to be linked with the 

 6          supportive services.  We think the way this 

 7          could work is if $10 million were to be 

 8          transferred from the housing side of the 

 9          budget to the New York State Office for the 

10          Aging so that they could handle doing 

11          requests for proposals, for resident service 

12          coordinators, and then organizations could do 

13          HCR for the capital.  That's how it's been 

14          working very well with the supportive housing 

15          model; we think it just needs to be extended 

16          to the elderly population.

17                 So New York State has a long history, 

18          a proud history of serving our elderly 

19          population.  New York State Homes and 

20          Community Renewal has done a lot for elders 

21          over the years, but with the changing 

22          demographics, with the elimination of 202, we 

23          think it's time to double down here and move 

24          in the direction of creating a real program 


 1          that will sustain itself over the years.  

 2                 So thank you very much for the 

 3          opportunity.

 4                 CHAIRMAN FARRELL:  Thank you very 

 5          much.

 6                 CHAIRWOMAN YOUNG:  Thank you.

 7                 SENATOR KRUEGER:  Thank you.

 8                 MR. BRODERICK:  Thanks.

 9                 CHAIRMAN FARRELL:  Hilary Lamishaw, 

10          director, NeighborWorks Alliance of New York 

11          State.

12                 MS. LAMISHAW:  Good afternoon.

13                 CHAIRWOMAN YOUNG:  Good afternoon.

14                 SENATOR KRUEGER:  Good afternoon.

15                 MS. LAMISHAW:  My name is Hilary 

16          Lamishaw, and I'm the director of 

17          NeighborWorks Alliance of New York State, 

18          which represents 19 community-based housing 

19          organizations throughout the state that are 

20          affiliated with the national NeighborWorks 

21          America company.

22                 I want to start by thanking you for 

23          both your support and interest in housing as 

24          well as your tenacity and endurance in being 


 1          able to sit through hearings and hear a lot 

 2          of technical information around housing.

 3                 I was going to be joined by one of my 

 4          member groups, Neighborhood Housing Services 

 5          of New York City, and unfortunately the CEO 

 6          was unable to make it at the last minute.  

 7          I've attached her testimony here, and of 

 8          course she's always available for questions 

 9          and follow-up specifically to her agency.

10                 I'm not going to read the testimony, 

11          I'll spare you that, and I will just sort of 

12          highlight a couple of things.  

13                 One is my organizations do a variety 

14          of housing services from real estate 

15          development, asset management, et cetera, to 

16          a lot of housing counseling and, 

17          unfortunately, now a lot of foreclosure 

18          prevention services as well.  

19                 But before I get to that, one of the 

20          things that about half my groups do is 

21          community-based lending as CDFIs, community 

22          development financial institutions.  And so 

23          even though that budget issue is not at your 

24          table, I'm going to take advantage of you 


 1          here and just sort of urge that there be 

 2          increased funding to this New York State CDFI 

 3          fund, because for every dollar that New York 

 4          State puts into it, you can leverage a 

 5          federal dollar of it.  And it really does 

 6          fill a huge gap at the community-based level 

 7          for capital for homeowners, homebuyers, 

 8          repairs, and that kind of thing.

 9                 So I want to move on to foreclosure 

10          prevention services.  You've heard a lot 

11          about it already, and many of you met with 

12          folks earlier this week.  So we're a member 

13          of the statewide campaign that Christie 

14          referred to.  We're a member of the statewide 

15          network which funds 94 agencies, housing 

16          counseling, and legal services.  Many of the 

17          housing counseling agencies are upstate, by 

18          the way.

19                 And I do want to mention that there's 

20          no other discrete funding for foreclosure 

21          prevention services.  I think that the 

22          incoming commissioner alluded to some funding 

23          towards it, and really there's very limited 

24          HUD housing counseling, which is sometimes 


 1          seen as funding.  Foreclosure prevention 

 2          typically doesn't -- it's really for 

 3          first-time homebuyers, and so you have to be 

 4          very careful about who you're counseling on 

 5          which money.  

 6                 So the state's foreclosure prevention 

 7          money that right now -- which is at the 

 8          Attorney General's office and which is ending 

 9          as of September 30th, means that there's 

10          going to be no other money to have staff on 

11          board to be able to do this critical work.  

12                 At TRIP, Troy Rehabilitation and 

13          Improvement Program, we're based in Troy, 

14          New York.  We have two staff under the HOPP, 

15          the Homeowner Protection Program -- one's a 

16          full-time housing counselor doing just 

17          foreclosure prevention, the other's an intake 

18          specialist -- and a caseload of 140 cases, 

19          some of which linger for years.  But our 

20          counsel was successful in getting 49 mortgage 

21          modifications last year -- which is really a 

22          drop in the bucket compared to the need, but 

23          it's probably 49 more than people would have 

24          gotten without having a housing counselor or 


 1          legal services that advocate for them.

 2                 I do want to mention a little bit the 

 3          impact on communities, or the impact of 

 4          foreclosures in general.  And I'll point out 

 5          that at the back of my testimony I have 

 6          attached a two-page sort of fact sheet about 

 7          the economic impact.  This was put together 

 8          for the statewide campaign, and it was put 

 9          together by Empire Justice Center, which has 

10          done great work on the campaign in general, 

11          and I think you'll find that information 

12          pretty interesting.  

13                 One of the -- I think the real 

14          problem, I guess, of the foreclosure crisis 

15          is not only the impact it has on families and 

16          disruption in credit and all that kind of 

17          stuff, but it really has a huge impact on 

18          communities and in some ways undoes decades 

19          of work that some of us not-for-profits have 

20          been doing in the community.  So we've been 

21          doing, at TRIP, community revitalization work 

22          for some 40 years.  Our homeowners have all 

23          been counseled, they're pretty stable, but 

24          around them we see people, you know, being 


 1          foreclosed on, leaving, vacancies and all 

 2          that kind of stuff.  And it really does 

 3          impact the state's investment, the money that 

 4          we've used that you have appropriated in the 

 5          past -- that there's nothing we can really do 

 6          about that.

 7                 And we have been -- we are partnered 

 8          with the state on the Neighborhood 

 9          Revitalization Program.  They're depending on 

10          us to get homebuyers, owner-occupants, into 

11          30 to 50 vacant buildings in the City of Troy 

12          in the next year and a half.  That's a 

13          challenge, it's going to be difficult, but 

14          we're up for the challenge.  They have asked 

15          us to participate with them in the community 

16          restoration programs or to do outreach when 

17          they buy notes for those that are in our 

18          service area, to do outreach and to counsel 

19          people in default.

20                 But one of the things I do want to 

21          clarify, because I know it came up earlier -- 

22          I think with Senator Bailey, who raised a 

23          question about zombie homes and the impact 

24          that that has.  And I know the Commissioner 


 1          talked about we're dealing with zombie homes 

 2          through the Neighborhood Revitalization 

 3          Program.  

 4                 I would beg to differ with that.  My 

 5          understanding of zombie homes is that those 

 6          are homes where people who were foreclosed on 

 7          got their letter, left, disappeared, can't 

 8          find them, and the lender hasn't proceeded 

 9          with the foreclosure.  So there's no real 

10          owner of that property, hence being a zombie.  

11                 So that's decimating some of the 

12          communities.  In the City of Troy, again, 

13          where we have 600 vacant homes on the city's 

14          registry, about a third of them are believed 

15          to be zombies.  Which means that you can't do 

16          anything with them until a lender is forced 

17          to go through a foreclosure process.  If you 

18          can't find the owner of record, you can't 

19          sell that property, you can't get a buyer to 

20          that property no matter how much subsidy, you 

21          know, the state is giving us.  

22                 So again, the best recourse for that 

23          is really prevention in the first place.  So 

24          to the extent that we can get to people as 


 1          soon as they're in arrears, as soon as they 

 2          get a 90-day pre-foreclosure notice, to the 

 3          extent that we can try to keep them in their 

 4          house or, if they need to leave, we can help 

 5          find subsequent homebuyers, I think that's 

 6          really key.  So Christie's comment was 

 7          "penny-wise and pound-foolish," and it 

 8          clearly applies in this case.

 9                 So moving on, preservation programs, 

10          we know many of you are very supportive.  We, 

11          along with our colleagues -- we support our 

12          colleagues' recommendation to go back to last 

13          year's levels, which are a little bit higher 

14          than this year's levels, as someone pointed 

15          out earlier.  We're very interested in seeing 

16          the money involved in the MOU out on the 

17          streets.  We have a huge need for capital to 

18          be able to do the things across the state 

19          that my groups want to do.  

20                 We understand that there's not a lot 

21          of detail in some of the programs, and we 

22          want to offer that we're happy to engage you 

23          in discussions at any point, at any time, to 

24          figure out what the best programs are to meet 


 1          the needs that we see in our communities.  

 2                 So thank you so much, and appreciate 

 3          your time.

 4                 CHAIRMAN FARRELL:  Thank you.

 5                 CHAIRWOMAN YOUNG:  Thank you.

 6                 Senator Krueger.

 7                 SENATOR KRUEGER:  Hi.  Just one 

 8          question, Hilary.

 9                 MS. LAMISHAW:  Sure.

10                 SENATOR KRUEGER:  So it's been my 

11          experience now, I guess over the last 15 

12          years, that we play this game, what I'll call 

13          whack-a-mole.  So the same players who were 

14          ripping off people with fake mortgages and 

15          then stealing deeds and then this and then 

16          that, we keep catching up with them and then 

17          we outlaw that or we say "You can't do 

18          that" -- and then they just pop up, literally 

19          the same human beings, under a different 

20          company name with a new gimmick.  

21                 What's the newest gimmick to rip off 

22          poor homeowners?

23                 MS. LAMISHAW:  You know, that's a 

24          really good question, and I'm not sure.  


 1                 I would say the scam artists are still 

 2          out there, and that's the ones who say "For a 

 3          small investment, I'm going to solve all your 

 4          credit issues, give me your money."  We often 

 5          see people who come to us saying they've 

 6          given $2,000, $4,000, $8,000 to someone who 

 7          was going to save their home, save their 

 8          life.  And so I think that's still a constant 

 9          one.  

10                 So I think it's really that people 

11          need more basic education, financial 

12          education, and need to know that those kind 

13          of magical solutions don't work that way.

14                 So I would say to the extent that we 

15          can get more financial literacy out earlier 

16          to people, that would be helpful.  Because 

17          those -- the moles are always going to be 

18          back, and it's going to look different from 

19          time to time.  

20                 SENATOR KRUEGER:  Thank you.

21                 MS. LAMISHAW:  Thanks.

22                 CHAIRWOMAN YOUNG:  Thank you.

23                 CHAIRMAN FARRELL:  Thank you.

24                 Benjamin Dulchin, executive director, 


 1          Association for Neighborhood and Housing 

 2          Development.  

 3                 Next will be Stuart Kaplan.

 4                 Good afternoon.

 5                 MR. DULCHIN:  Hi, good afternoon.  

 6                 I will be very brief.  I will just 

 7          summarize my remarks, out of respect for the 

 8          many hours, attentive hours, you guys have 

 9          spent this morning.  And thank you for that.

10                 So good afternoon.  My name is 

11          Benjamin Dulchin, and I am the executive 

12          director of the Association for Neighborhood 

13          and Housing Development.  I want to thank 

14          Chairs Little, Farrell, Young, and Cymbrowitz 

15          for holding this hearing and for allowing me 

16          to testify this morning on the 2018 budget.

17                 ANHD, the Association for Neighborhood 

18          and Housing Development, is the umbrella 

19          organization of now 102 neighborhood-based, 

20          mission-driven affordable housing and 

21          economic development organizations across all 

22          five boroughs of New York City.  Our members 

23          were instrumental in creating the city-backed 

24          affordable housing models that the city has 


 1          used for the last 30 years.  ANHD member 

 2          organizations over the last 30 years have 

 3          built well over 100,000 units of affordable 

 4          housing and currently actively manage about 

 5          30,000 of those units.  So we are deeply 

 6          steeped in the economics of affordable 

 7          housing development and finance.  

 8                 Again, I won't take up your time this 

 9          morning reciting a litany of data to make the 

10          case once again that there is an affordable 

11          housing crisis in the city and the state.  

12          You know, speaking as an organization that 

13          works in all five boroughs, every New Yorker 

14          knows that there is an incredible affordable 

15          housing crunch at almost all levels of the 

16          income spectrum except for the very highest 

17          level.  And more than a third of New Yorkers 

18          are grossly over-rent-burdened and are really 

19          experiencing it at a devastating level in 

20          their own lives.

21                 It is pretty clear that rents are 

22          rising, incomes are not rising, and the 

23          effect is pretty much what you'd think it 

24          would be.  The New York State government has 


 1          long supported and consistently supported 

 2          affordable housing activities and needs to 

 3          continue to expand those activities to 

 4          support families across the state.  Each new 

 5          affordable housing unit isn't just a family 

 6          that's brought some stability, that's able to 

 7          have a better economic path for themselves; 

 8          it's also an opportunity to create stronger 

 9          neighborhoods and stronger communities.

10                 We were very heartened with the MOU 

11          last year that was to release some $2 billion 

12          in resources for affordable housing.  We are 

13          further heartened to see in the draft budget 

14          announced by the Governor some $2.5 billion 

15          in resources for affordable housing.  For the 

16          last 12 months, we haven't seen any of those 

17          resources actually come to the streets where 

18          they can actually build housing because 

19          they've been held up in unrelated struggles 

20          on other issues in New York State, and that 

21          has had a pretty significant impact.  

22                 Affordable housing developers need the 

23          resources, but they also need consistency of 

24          expectations to build the affordable housing 


 1          that we all agree needs to be built.  And so 

 2          we would simply implore the State 

 3          Legislature, as we would implore the 

 4          Executive, to decouple the issue of the MOU, 

 5          to decouple the issue of the financing 

 6          resources for the affordable housing programs 

 7          that pretty much everyone agrees on, to 

 8          decouple those from other issues, 

 9          particularly 421-a.  For some reason, those 

10          two issues have been melded together in the 

11          political conversation.  

12                 There's really no programmatic reason 

13          for them to be connected.  421-a is -- you 

14          know, I think you guys know is really, 

15          fundamentally, not about affordable housing.  

16          It's an abatement that -- an exemption that 

17          is intended to incentivize the private market 

18          to build mostly higher-end housing.  We think 

19          it does so inefficiently.  

20                 But regardless, it's not fundamental 

21          to any of the city's affordable housing 

22          plans.  It plays a minor role, and it is 

23          important to note that although 421-a expired 

24          on January 1, 2016, in 2016 the housing 


 1          production numbers, the affordable housing 

 2          production numbers just announced by 

 3          Mayor de Blasio and his administration, 

 4          demonstrated that they outstripped their 

 5          housing goals quite significantly.  

 6                 They built some 16,000 affordable 

 7          units last year, they started some 16,000 

 8          affordable units last year, surpassing the 

 9          goals that they had, and going down as the 

10          most productive affordable housing 

11          development year on record for New York City.  

12          And that's pretty impressive, given that 

13          we've had some very good affordable housing 

14          mayors.  And they did that during a year when 

15          there was no 421-a.  

16                 It is pretty irrefutable that 421-a is 

17          not essential to the affordable housing 

18          conversation, and it should be -- it is an 

19          important conversation, but it really should 

20          be separated and the MOU should decouple and 

21          go forward without it.

22                 So with that, I won't sort of repeat 

23          what a lot of my colleagues have said.  We 

24          strongly support the essential elements of 


 1          the program that the Governor has proposed.  

 2          The allocation for supportive housing, the 

 3          allocation for funds to create a home 

 4          stability support new statewide supplement, 

 5          the $100 million to NYCHA is obviously 

 6          essential.  

 7                 NYCHA has long been underfunded and 

 8          provides an extraordinary service to the 

 9          people who most need it without having the 

10          resources they really need.  And having state 

11          support to help to cover the capital needs 

12          that are so essential is -- it's an essential 

13          service to the New Yorkers who need it most.  

14                 We would strongly align ourselves with 

15          our colleagues calling for continued 

16          programmatic support for anti-foreclosure 

17          efforts.  And just in closing, we support the 

18          concept of a mansion tax, which we think is 

19          an effective way of creating the resources 

20          that we need.  

21                 So again, we think that the essential 

22          elements of the housing plan that have been 

23          put forward by the Executive make a lot of 

24          sense.  But none of them makes sense unless 


 1          the funding is there, and we would strongly 

 2          urge that the funding be expeditiously 

 3          released and not tied up in other issues.

 4                 Thank you.

 5                 CHAIRMAN FARRELL:  Thank you.

 6                 CHAIRWOMAN YOUNG:  Senator Krueger has 

 7          a question.

 8                 SENATOR KRUEGER:  Thank you.

 9                 So thank you for your testimony.  Your 

10          organization does an enormous amount of 

11          digging down to the neighborhood level for 

12          data, and in fact you gave us some today, so 

13          thank you.

14                 But were you here when I was having a 

15          discussion with outgoing Commissioner 

16          Jamie -- I'm sorry --

17                 CHAIRWOMAN YOUNG:  Rubin.

18                 SENATOR KRUEGER:  -- Rubin earlier 

19          today, and we were having a little discussion 

20          about the reality in our district, of which 

21          he is a constituent?  And I was laying out 

22          that actually we're losing affordable housing 

23          at an incredibly rapid rate, and the -- 

24          specifically the Option G scenario would 


 1          actually, in my opinion, potentially wipe out 

 2          affordable housing in a very quick time 

 3          frame, both in my district up and down the 

 4          East Side, and probably parallel in sections 

 5          of the West Side.  

 6                 Based on your data, am I crazy to say 

 7          that's going to happen?

 8                 MR. DULCHIN:  I think that there's a 

 9          strong reason to think that you're correct.  

10          It is pretty profitable to build market-rate 

11          housing in the city, especially in 

12          higher-income districts like yours, and to do 

13          so while paying no real estate taxes for 

14          35 years really makes it a slam dunk.  It is, 

15          you know, in your neighborhood that they have 

16          been building mostly higher-end condos for a 

17          while, but it is probably the case -- I mean, 

18          housing markets are complicated.  It seems to 

19          be the case that at least in the outer 

20          boroughs that condo markets are getting 

21          oversaturated.  And so with the creation of 

22          this new approach, where you could build a 

23          rental and take advantage of a 35-year 

24          abatement, an additional 10-year 100 percent 


 1          exemption, may well turn a number of 

 2          developers who otherwise wouldn't have 

 3          acted -- so I suspect that you have -- that 

 4          there is a lot to what you are saying.

 5                 SENATOR KRUEGER:  Thank you.

 6                 CHAIRMAN FARRELL:  Thank you.

 7                 Stuart Kaplan, CEO, Selfhelp Community 

 8          Services.

 9                 MR. KAPLAN:  Good afternoon, all.

10                 CHAIRMAN FARRELL:  Good afternoon.

11                 MR. KAPLAN:  Chair Young, Chair 

12          Farrell, Chair Cymbrowitz, nice to see you.  

13          And Senator Krueger, good afternoon.

14                 I am Stuart Kaplan, the CEO of 

15          Selfhelp Community Services, and I'm 

16          delighted to be able to talk a bit about the 

17          Governor's proposed Executive Budget for 

18          fiscal 2018, particularly in regard to 

19          seniors.

20                 I am the first speaker, I believe, 

21          that is not representing an association and 

22          representing just a particular 

23          organization -- in my case, one that was 

24          founded in 1936 to care for Holocaust 


 1          survivors.  We continue to do that today.  We 

 2          now have 27 locations around New York City 

 3          and Long Island serving some 20,000 elderly 

 4          people, including almost 5,000 Holocaust 

 5          survivors.  Our primary mission is to ensure 

 6          that seniors are able to live independently 

 7          and with dignity and to avoid 

 8          institutionalization.

 9                 Our network of services at 

10          Selfhelp consists of 10 affordable senior 

11          housing complexes; four Naturally Occurring 

12          Retirement Communities; three case management 

13          programs; five senior centers, including one 

14          of the first Innovative Senior Centers in the 

15          city; home healthcare programs; 

16          client-centered technology, including a 

17          Virtual Senior Center that we have created; 

18          court-appointed guardianship programs; and 

19          Alzheimer's programs for people with 

20          early-stage and mid-stage dementia.

21                 Selfhelp's housing world began in 

22          1964.  I've heard a number of references 

23          today to the Mitchell-Lama program.  Selfhelp 

24          was the first not-for-profit in the state to 


 1          begin a Mitchell-Lama program for seniors in 

 2          1964, followed by another one in 1970.  Today 

 3          our housing complexes care for approximately 

 4          1400 people around the city, in Queens, the 

 5          Bronx, and Nassau County.  And we will be 

 6          adding 10 percent to that number with two 

 7          projects that we have underway in Brooklyn.

 8                 As you know, the Governor's Executive 

 9          Budget includes substantial new investments 

10          in affordable housing.  Among these 

11          investments is a proposed appropriation of 

12          $125 million of capital funds dedicated to 

13          construction and rehabilitation of senior 

14          housing.  We clearly applaud that initiative 

15          over the next five years.

16                 Unfortunately, as has been mentioned, 

17          the proposed budget does not include language 

18          that would create a distinct senior housing 

19          program.  Such a program would be strictly 

20          for senior housing developers and not 

21          co-mingled, if you will, with developers of 

22          housing for other populations.  This would 

23          help to fulfill the Governor's call for 

24          New York State to be a leader in age-friendly 


 1          communities.  

 2                 An affordable housing coalition, many 

 3          of whom you've heard from today, is drafting 

 4          legislation that would create a distinct 

 5          affordable senior housing and services 

 6          program.  We urge you to support this 

 7          provision and to ensure that it is included 

 8          in the final budget.  

 9                 We might ask why an affordable senior 

10          housing and services program, distinct -- 

11          well, we have learned that affordable 

12          housing, with supportive services for the 

13          mental health and behavioral health 

14          populations, saves money.  Certainly the 

15          New York State Medicaid Redesign Team, the 

16          MRT initiative, has made substantial 

17          investments in affordable housing, with 

18          supportive services that help keep these 

19          populations stably housed, avoiding costly 

20          shelters and other institutional 

21          settings and, at the same time, dramatically 

22          improving the quality of life for thousands 

23          of formerly homeless seniors.

24                 Unfortunately, our state has yet to 


 1          make similar investments in senior housing -- 

 2          senior housing being the primary social 

 3          determinant of health -- to assist the 

 4          elderly, many of whom will eventually need 

 5          and be eligible for Medicaid-funded nursing 

 6          home care, at great expense to the state.  

 7          While many seniors are not currently users of 

 8          Medicaid services because of coverage under 

 9          Medicare, frail seniors are likely to become 

10          high-cost users of Medicaid if they have no 

11          other choice than to move to a nursing home 

12          and either immediately or eventually receive 

13          coverage through Medicaid.  

14                 An affordable housing with services 

15          program is far less costly than skilled 

16          nursing facilities, which cost upwards, 

17          certainly downstate, of $100,000 per person 

18          per year and are not always the most 

19          appropriate place for people to live as they 

20          age.  And I believe we all know in our hearts 

21          that looking forward to nursing home care is 

22          not something that people generally do.  

23                 A model of housing and services that 

24          we employ at Selfhelp, as an example, offers 


 1          much more than just an affordable place to 

 2          live.  We have social workers who support 

 3          residents' independence and quality of life 

 4          as they age in their homes.  Services include 

 5          information and referral, wellness programs, 

 6          volunteer opportunities, social events, and 

 7          connections to community-based resources that 

 8          then can offer meals, home care services, 

 9          case management, and more.  These services 

10          are available, and I underscore, on an 

11          if-and-when-needed basis.  People are living 

12          independently in these homes and apartment 

13          buildings, and they may not need these 

14          services when they move in when they are 65, 

15          75, or 85, yet they may need them ten years 

16          hence.

17                 I invite committee members to visit 

18          and see the apartments and services and 

19          interesting technology that we use in 

20          Selfhelp senior complexes, and also to see 

21          the smiles on the faces of the seniors.  I'm 

22          sure that will put smiles on your faces as 

23          well.  

24                 I might add, as opposed to the 


 1          $100,000 price tag for a skilled nursing 

 2          facility downstate, this program at Selfhelp 

 3          runs at a cost for services of $800 per year.

 4                 Our coalition has also proposed adding 

 5          $10 million to the budget for a senior 

 6          housing residence service coordinator 

 7          program, which would put up to 140 new 

 8          service coordinators in new and existing 

 9          senior housing around the state.  Service 

10          coordinators in senior housing residences 

11          have proven to reduce healthcare costs by 

12          reducing unnecessary hospitalizations and 

13          premature entry into Medicaid-funded nursing 

14          homes.  And by encouraging health and 

15          wellness, and effective use of the primary 

16          health system, this investment has enormous 

17          cost savings potential.  There is currently 

18          no funding stream for this service, and an 

19          investment would greatly enhance the program.

20                 I've mentioned that we have such a 

21          program operating at Selfhelp, and we've done 

22          it by cobbling together a disparate array of 

23          services that come from either the state or 

24          the city, and we then underwrite the balance 


 1          of that with philanthropy.  Certainly you 

 2          would agree this is not an efficient nor a 

 3          sustainable model that can be scaled 

 4          statewide.  

 5                 The Affordable Housing and Services 

 6          Program including the senior housing resident 

 7          service coordinator program would put 

 8          New York State in the forefront of senior 

 9          housing in the nation and again make us a 

10          leader in age-friendly communities.

11                 In closing, all members received -- as 

12          my colleague John Broderick mentioned from 

13          LeadingAge New York -- the recommendations of 

14          the Bipartisan Policy Commission on the topic 

15          of senior housing.  It clearly sets forth 

16          additional support and rationale for a 

17          housing and services model and also provides 

18          the empirical data and substantial other 

19          material for the rationale for a senior 

20          housing with services program.

21                 I thank you and would be happy to 

22          answer any questions.

23                 CHAIRMAN FARRELL:  Thank you very 

24          much.  


 1                 We've been joined by Assemblyman 

 2          Barron.

 3                 Any questions?

 4                 CHAIRWOMAN YOUNG:  I saw 

 5          Assemblymember Cymbrowitz.

 6                 CHAIRMAN FARRELL:  Yes, 

 7          Mr. Cymbrowitz.

 8                 ASSEMBLYMAN CYMBROWITZ:  Thank you, 

 9          Stuart.

10                 MR. KAPLAN:  Thank you.

11                 ASSEMBLYMAN CYMBROWITZ:  I can confirm 

12          that I did have a smile on my face when I 

13          toured your Flushing developments.  They 

14          truly work with the community that they 

15          serve, and it really does make sense to have 

16          that program where we can help seniors when 

17          they need it.  Congratulations on the good 

18          work that you and Sandy Myers do.  Keep it 

19          up.

20                 MR. KAPLAN:  Thank you so much.  I 

21          appreciate it, Assemblyman.

22                 CHAIRMAN FARRELL:  Senator?

23                 SENATOR KRUEGER:  Thank you.  

24                 So I think you've answered my 


 1          questions, but -- so you actually have this 

 2          model already in place in your sites, the 

 3          senior --

 4                 MR. KAPLAN:  That's correct.

 5                 SENATOR KRUEGER:  And so what is the 

 6          funding stream that you currently use?

 7                 MR. KAPLAN:  So collocating services 

 8          in senior housing comes from a variety of 

 9          sources.  We have funding for senior centers 

10          and in two of our properties which comprise 

11          two campuses, so there are several buildings 

12          associated.  We have senior centers that come 

13          from -- that are funded through the New York 

14          City Department for the Aging.  

15                 Some of the housing properties provide 

16          enough excess income to have a social worker 

17          on staff.  The social worker is key to the 

18          organization and access to all of the other 

19          services that I've mentioned.  

20                 The technology that we employ, which 

21          includes sensor technologies and other types 

22          of technologies that are used with people 

23          with early-stage dementia -- memory games, if 

24          you will -- are provided through foundations 


 1          and philanthropy.  

 2                 When a senior -- when and if a senior 

 3          should require home care services, the social 

 4          work staff would be able to help guide the 

 5          tenant who may -- or the family member who 

 6          needs those services to home care programs in 

 7          the community so that home care can be 

 8          brought in.  The same goes for meals, and 

 9          those have separate independent funding 

10          sources.  

11                 So the types of services that a senior 

12          would need to continue to live independently 

13          are assessed by staff that are paid for 

14          either through philanthropy or by some 

15          minimal excess income from the properties, 

16          and then we cobble together the rest of the 

17          services from there.

18                 SENATOR KRUEGER:  So basically you're 

19          a large enough and a multi-service-enough 

20          kind of senior agency that you can cobble 

21          together from different parts of different 

22          budgets.

23                 MR. KAPLAN:  Correct, but despite -- 

24          if we were in a rural county of upstate 


 1          New York or otherwise, that service 

 2          coordinator would be able to do the very same 

 3          thing for a building that had 60 units or --

 4                 SENATOR KRUEGER:  I agree completely.  

 5          My point was that in much of the state, and 

 6          even in many parts of the city, the providers 

 7          or the providers we hope to bring in aren't 

 8          going to be necessarily large enough to be 

 9          able to do it on their own, as to some degree 

10          you've been able to do it on your own as a 

11          model because you have such a multi-pronged 

12          agency budget -- I would guess probably, in 

13          total, a fairly large agency budget.

14                 MR. KAPLAN:  Senator, I certainly 

15          agree with that as to today.  

16                 Selfhelp started this model in 1964 

17          with our first building for Holocaust 

18          survivors.  At that time we did not have our 

19          senior centers, we did not have the home care 

20          programs, we did not have the technology.  

21          And yet we recognized, in service to the 

22          survivor population, that their needs were 

23          greater than most and that we needed to be 

24          able to help them to access those types of 


 1          supports that would help them to live with 

 2          dignity and independently.  So this does date 

 3          back now more than 60 years -- 50 years.

 4                 SENATOR KRUEGER:  Thank you very much.

 5                 MR. KAPLAN:  Thank you very much.

 6                 CHAIRMAN FARRELL:  Thank you.

 7                 CHAIRWOMAN YOUNG:  Thank you.

 8                 MR. KAPLAN:  Thank you.

 9                 CHAIRMAN FARRELL:  Jacquelyn Kilmer, 

10          CEO, Harlem United Community AIDS Center.  

11                 MS. KILMER:  Good afternoon.

12                 CHAIRMAN FARRELL:  Good afternoon.

13                 MS. KILMER:  Thank you for the 

14          opportunity to testify before you today.  

15                 My name is Jacquelyn Kilmer, and I'm 

16          the chief executive officer at Harlem United.  

17          Harlem United has 29 years experience in 

18          providing critical health, housing, and 

19          responsive human service to people with 

20          multiple complex needs.  With over 700 units 

21          of supportive housing, 3,000 primary care 

22          visits a year to our three Federally 

23          Qualified Health Centers, two AIDS adult day 

24          healthcare programs, mental health, substance 


 1          use treatment, harm reduction, syringe 

 2          exchange, community-based outreach and 

 3          preventive screenings, Harlem United is able 

 4          to "level the playing field" for more than 

 5          10,000 New Yorkers each year.  The vast 

 6          majority of the New Yorkers who we serve are 

 7          those who are the most disenfranchised -- 

 8          homeless or unstably housed, living with HIV 

 9          or AIDS, hepatitis C, diabetes, extreme 

10          poverty, addiction issues and mental illness 

11          issues.  Harlem United serves the most 

12          vulnerable citizens of New York and we are, 

13          for many, the service provider of last 

14          resort.  

15                 Beginning with the successes of our 

16          first 60 units of HIV supportive housing in 

17          1991, we at Harlem United know firsthand that 

18          supportive housing can reduce the number and 

19          length of hospital stays, the number of 

20          emergency room visits, and the number of 

21          psychiatric hospitalizations.  Our supportive 

22          housing programs allow us to reach HIV 

23          positive individuals with routine testing, 

24          and link them to and retain them in care in 


 1          order to achieve suppressed viral load.  

 2          Achieving a suppressed viral load, in turn, 

 3          brings health benefits for the individual and 

 4          drastically reduces the risk of transmission 

 5          to others.  

 6                 In the spring of 2016, Harlem United, 

 7          working with the New York City Human 

 8          Resources Administration and the Department 

 9          of Homeless Services and Veterans Affairs, 

10          began providing permanent congregate housing 

11          and supportive services to homeless veterans.  

12          Not surprisingly, the majority of these men 

13          and women are living with chronic mental 

14          health conditions or addiction issues or 

15          both, in addition to chronic medical 

16          conditions.  

17                 With these men and women, Harlem 

18          United sees the need for more intensive 

19          services to be readily available, including 

20          comprehensive psychosocial and mental health 

21          services, in order to make their transition 

22          from the streets and homeless shelters to 

23          stable, permanent housing successful.

24                 We've already heard significant 


 1          testimony today regarding capital funding 

 2          that's in the budget and the need to release 

 3          the $1.82 billion that is yet to be released 

 4          from last year, so I won't focus on that.  

 5          And there's no question that capital funding 

 6          is very important in order to increase the 

 7          supply of available supportive housing units.  

 8          However, it must also come with ongoing 

 9          commitments to provide for the services and 

10          operating funds that are necessary to make 

11          the housing truly supportive and successful. 

12                 In addition, to be a viable resource, 

13          scattered-site supportive housing has to have 

14          adequate funds to keep pace with the 

15          ever-increasing market rents.  In order to 

16          address these issues, we are asking that the 

17          Legislature support the $30 million in 

18          safety-net public assistance funding provided 

19          in the Executive Budget to cover expanded 

20          participation in HIV/AIDS housing resulting 

21          from the policy change allowing 

22          income-eligible but non-symptomatic people 

23          living with HIV/AIDS in New York City to 

24          access services.  


 1                 We're also asking for an additional 

 2          $20 million in funding to initiate a 

 3          demonstration project to leverage the 

 4          existing HIV emergency shelter allowance to 

 5          expand access to HIV rental assistance to 

 6          income-eligible people with HIV who reside in 

 7          New York State communities outside of 

 8          New York City.  To date, state HIV housing 

 9          assistance has not been made available to 

10          low-income New Yorkers living outside of 

11          New York City, which leaves an estimated 

12          4,000 to 6,000 individuals with HIV living in 

13          upstate New York and in Long Island with 

14          unmet housing needs.  

15                 This $20 million pilot project would 

16          be structured to ensure expanded access by 

17          increasing approved rents available under the 

18          existing program and providing an affordable 

19          housing protection for households with HIV 

20          who receive disability income.  We would also 

21          urge that the statewide HIV rental assistance 

22          program be implemented in a way that limits 

23          contribution to rent from income to 

24          30 percent, thus mirroring the 30 percent 


 1          rent cap protections in New York City.  

 2                 We would ask for an increase in the 

 3          $10 million provided in the Executive Budget 

 4          for existing OMH-supported housing and single 

 5          residency occupancy programs, to ensure 

 6          sufficient funding for all existing 

 7          scattered-site units statewide at acceptable 

 8          levels for both rent and services.  

 9                 And finally, we would ask for 

10          increased funding for OTDA's New York State 

11          Supportive Housing Program by $4.2 million, 

12          to restore last year's cuts to existing 

13          programs and fund existing unfunded programs.

14                 Thank you.  

15                 CHAIRWOMAN YOUNG:  Thank you.  

16                 Any questions?

17                 SENATOR KRUEGER:  Thank you.

18                 CHAIRMAN FARRELL:  Thank you.

19                 Charles King, Housing Works.

20                 MR. KING:  Good afternoon, honorable 

21          chairs and other members of the Senate and 

22          Assembly.  I'm Charles King.  I'm the 

23          president and CEO of Housing Works.  I'd like 

24          to also take this opportunity to introduce 


 1          Housing Works' new director of New York State 

 2          government relations, Jillian Faison, who 

 3          some of you may know from her work here in 

 4          prior periods.

 5                 I want to be very frank with you about 

 6          ending the epidemic here in New York State.  

 7          There's good news, which I will share, but 

 8          there's also bad news.  The good news is 

 9          that, first of all, in 2014 New York State 

10          made a remarkable commitment to become the 

11          first jurisdiction anywhere in the world to 

12          end AIDS as an epidemic.  And we have 

13          followed through on that commitment.  I 

14          commend both of the houses for their 

15          commitment of resources to this effort, as 

16          well as the Governor.

17                 As it pertains to housing in New York 

18          City, we now have a 30 percent cap on tenant 

19          income as a contribution to their ability to 

20          access supportive housing and enhanced rental 

21          assistance.  And last June the New York State 

22          AIDS Institute changed the definition of HIV 

23          disease for purposes of accessing the 

24          enhanced rental assistance to include all 


 1          income-eligible people infected with HIV.  

 2                 As a consequence of these changes, we 

 3          now have 28,000 households in New York City 

 4          receiving HIV enhanced rental assistance, and 

 5          it shows in the data.  In the 2015 

 6          surveillance report for New York City, 

 7          83 percent of people who are HIV-positive are 

 8          in care, and a remarkable 75 percent of all 

 9          people in New York City who are HIV-positive 

10          are completely virally suppressed.  What that 

11          means is they have stopped disease 

12          progression in their own bodies and it is 

13          impossible for them to transmit the virus to 

14          another person.  That is a remarkable success 

15          story.  And as a consequence, for the first 

16          time we see a more than 10 percent decrease 

17          in new diagnoses among young men who have sex 

18          with men, including young men of color.  This 

19          is a remarkable achievement.

20                 That's the good news.  The state 

21          surveillance report for the same period will 

22          be coming out in the next few weeks, and 

23          preliminary data indicate that while in 

24          New York City, which has 80 percent of the 


 1          entire epidemic, viral suppression is at 

 2          75 percent, statewide viral suppression is 

 3          only at 69 percent.  

 4                 What that means is that in the rest of 

 5          the state, viral suppression is only about 

 6          50 percent.  And my warning to you is that if 

 7          we don't address this, we will achieve ending 

 8          the epidemic by 2020 in New York City alone, 

 9          and not in the rest of our state.

10                 Now, what accounts for this 

11          difference?  It is not the quality of 

12          prevention, it is not the quality of 

13          treatment and care that takes place in all of 

14          the other localities in New York State.  

15          There is one major differential.  In New York 

16          City, 28,000 households access the enhanced 

17          rental assistance program and achieve housing 

18          stability.  In the rest of our entire state, 

19          with 20 percent of the epidemic, only 

20          107 households in all of Long Island, Albany, 

21          Onondaga, Erie -- all of these other counties 

22          heavily impacted by HIV, only 107 households 

23          have access to the enhanced rental 

24          assistance.


 1                 Why is this?  In part because many 

 2          localities don't make it widely available, 

 3          but also because there's not a 30 percent 

 4          rent cap.  As a consequence, if you have any 

 5          income outside of public assistance, you are 

 6          deemed ineligible for the enhanced rental 

 7          assistance.  Not only that, but if you are on 

 8          public assistance, your rent cannot be more 

 9          than $480 a month.  Please tell me, in what 

10          county in New York State can one find rent 

11          for less than $480 a month?  

12                 That is why we are calling for this 

13          year an appropriation of $20 million to 

14          supplement the $480 rental assistance, 

15          coupled with a cap that tenants should not 

16          contribute more than 30 percent of their 

17          income to their housing statewide, coupled 

18          with a change in formula that allows this 

19          additional supplemental rent subsidy without 

20          counting towards a public assistance 

21          recipient's income.  

22                 If we can achieve this, this will at 

23          minimum allow us to ensure stable housing to 

24          some 3,600 households around the rest of 


 1          New York State, meeting the minimum estimated 

 2          need burden for the entire state, and thereby 

 3          helping us truly achieve ending the AIDS 

 4          epidemic throughout New York State and not 

 5          just in New York City.

 6                 Thank you very much.

 7                 CHAIRMAN FARRELL:  Thank you.

 8                 Questions?

 9                 SENATOR KRUEGER:  Velmanette 

10          Montgomery.  

11                 SENATOR MONTGOMERY:  Thank you.  

12                 I just wanted to ask you -- and this 

13          is not a housing issue, but it's an AIDS 

14          issue in particular.  And I just wanted to 

15          ask you if you have any sense of how we're 

16          doing with people who are incarcerated.  

17          Because at one point for us in the city in 

18          particular, and I guess statewide, that was a 

19          huge problem in terms of --

20                 MR. KING:  So actually, for people who 

21          are incarcerated who have disclosed their 

22          status to DOCCS, we are doing exceptionally 

23          well.  Viral suppression is around 

24          95 percent.  


 1                 There is a small percentage of people 

 2          who go into DOCCS who do not disclose their 

 3          HIV status.  And thanks to the Ending the 

 4          Epidemic Initiative, the AIDS Institute is 

 5          now matching, with DOCCS data, the 

 6          surveillance data and not notifying DOCCS, 

 7          but actually sending AIDS Institute staff 

 8          into Corrections to work with those people 

 9          who haven't disclosed to ensure that they can 

10          disclose safely.  And if they choose not to, 

11          that they're linked to care as soon as 

12          they're discharged.  

13                 The fundamental barrier with DOCCS 

14          always -- and there are a lot of steps to 

15          address it -- is what happens when somebody 

16          is released.  Are we ensuring that they are 

17          immediately linked to care, to housing, and 

18          the services they need in the community so 

19          that they can continue their viral 

20          suppression?  

21                 And the other thing that we're working 

22          towards is being able to deliver pre-exposure 

23          prophylaxis to folk who are at highest risk 

24          who are in Corrections so that when they come 


 1          out and the first thing they do is look for a 

 2          partner, that they don't run the risk of 

 3          getting infected as well.

 4                 SENATOR MONTGOMERY:  And you know that 

 5          the chair of our Health Committee, Dick 

 6          Gottfried, has legislation, and I'm 

 7          sponsoring it in the Senate, that would do 

 8          just exactly what you're talking about.

 9                 MR. KING:  Yes.

10                 SENATOR MONTGOMERY:  So hopefully we 

11          can hear more support from you on that, or 

12          more thoughts from you on that legislation.

13                 MR. KING:  Yes, we strongly support 

14          that.  

15                 And since you've given me the 

16          opportunity, I would also note that while the 

17          Governor has raised the age for homeless and 

18          runaway youth to stay in housing until age 

19          24, I believe it is, there have not been any 

20          additional funds provided.  That's a system 

21          that's already clogged up.  So we want to 

22          celebrate raising the age, but we also need 

23          more housing resource for young people who 

24          fall in that age cohort.


 1                 SENATOR MONTGOMERY:  Thank you.

 2                 MR. KING:  Sure.

 3                 CHAIRMAN FARRELL:  Assemblyman Barron.

 4                 ASSEMBLYMAN BARRON:  Yes, I just 

 5          wanted to simply commend you for the work 

 6          that you're doing, and it's a real minimal 

 7          ask for a major problem, in viral 

 8          suppression.  

 9                 But I also wanted to congratulate you 

10          on your wisdom for selecting Ms. Faison to be 

11          a part of your staff.  She is an excellent 

12          worker.  We've done work in the past.  

13                 So I want to highly commend you for 

14          your position, and I will continue to be very 

15          supportive.

16                 MR. KING:  Assemblyman, she's already 

17          proved to be a brilliant decision, and I take 

18          total credit myself for that.

19                 (Laughter.)

20                 CHAIRWOMAN YOUNG:  Very nice.  Good.

21                 CHAIRMAN FARRELL:  Thank you very 

22          much.

23                 SENATOR KRUEGER:  Thank you very much.

24                 MR. KING:  Thank you.


 1                 MS. FAISON:  Thank you.  

 2                 CHAIRMAN FARRELL:  Lisa Frisch, 

 3          executive director, The Legal Project.

 4                 MS. FRISCH:  Thank you very much.  My 

 5          name is Lisa Frisch.  I'm the executive 

 6          director of The Legal Project here in Albany.  

 7                 The Legal Project was created over 

 8          21 years ago by the Capital District Women's 

 9          Bar Association as an independent nonprofit 

10          with the mission to provide civil legal 

11          services to domestic violence victims and the 

12          working poor in the Capital Region.  We fill 

13          a gap of services which are not provided by 

14          other programs in the area, and have 

15          developed programs to meet the needs in the 

16          community, including a foreclosure program 

17          that I'm here to talk about.

18                 We initially received funding through 

19          the New York State Homes & Community Renewal, 

20          which was then the New York State Division of 

21          Housing and Community Renewal, and we became 

22          part of New York's network of foreclosure 

23          prevention services, which by now you know is 

24          comprised of 94 nonprofit service providers 


 1          providing no-cost legal services to 

 2          homeowners in varying stages of the 

 3          foreclosure process.

 4                 Upstate, our programs have worked 

 5          under the leadership of the Empire Justice 

 6          Center.  Locally, The Legal Project has been 

 7          a member of a coalition in the Capital Region 

 8          called HOMESAVE, which includes housing 

 9          counselors, legal services providers, and 

10          other local organizations working together to 

11          provide the most effective and streamlined 

12          homeowner assistance.

13                 In 2012, we received funding through a 

14          competitive grant process which was 

15          administered by the Office of the Attorney 

16          General, after the agency was provided funds 

17          in the National Mortgage Settlement.  This 

18          funding allowed us to hire four staff 

19          attorneys, a paralegal, and an administrative 

20          assistant.  

21                 The majority of clients served through 

22          our current foreclosure program have had an 

23          unexpected event in their life that caused 

24          major financial disaster, including illness, 


 1          job loss, and loss of income.  These clients 

 2          are new to legal services.  They are 

 3          essentially the new poor.  This is the first 

 4          time they've reached out for help from any 

 5          service, generally, and now they often have a 

 6          multitude of legal issues that have come up 

 7          as a result of financial or medical issues.

 8                 We're in the fifth year of this 

 9          critical funding, and as you know, there's no 

10          future settlement funds being allocated to 

11          the Office of the Attorney General, due to 

12          the change in state rules which now requires 

13          all funds to go to the State Budget.  Without 

14          this core funding again being placed in the 

15          State Budget specifically for foreclosure 

16          prevention, these critical legal and housing 

17          counseling services are surely going to come 

18          to an end, and the excellent statewide 

19          infrastructure of these services would be 

20          lost.  

21                 In providing these services for the 

22          past seven years, it's become really evident 

23          that it's absolutely essential for homeowners 

24          to have legal representation when going 


 1          through a foreclosure action.  Homeowners who 

 2          have legal counsel get quicker resolution of 

 3          these cases, and less time is spent in the 

 4          state court system.

 5                 Lenders are always represented by 

 6          legal counsel.  So if a homeowner doesn't 

 7          have legal representation, they are at a 

 8          great disadvantage.  Lenders' attorneys often 

 9          rely on the homeowner's lack of knowledge of 

10          their rights and options available to them.

11                 Our foreclosure program works in 

12          tandem with our local housing programs and 

13          other legal services programs in the area in 

14          order for us to be able to triage these cases 

15          and make sure that people don't fall through 

16          the cracks.  Working within this foreclosure 

17          prevention services network has provided 

18          homeowners the ability to receive services 

19          from housing counselors and legal services 

20          early in the process, which greatly increases 

21          the likelihood of saving their home.  What we 

22          know is early intervention makes a huge 

23          difference.

24                 Currently we have over 200 active 


 1          cases, most of which we anticipate will be 

 2          ongoing in September when this current 

 3          funding ends.  We also have new clients 

 4          seeking our help every single day.  This area 

 5          of law is incredibly specialized, with rules 

 6          and regulations which are constantly changing 

 7          and would make it extremely difficult for pro 

 8          bono attorneys or members of the private bar 

 9          to pick up any of these cases should we have 

10          to discontinue this program.  

11                 We work with over 200 pro bono 

12          attorneys in the Capital Region, and we have 

13          tried to come up with mechanisms to have them 

14          be able to assist us on this project, and 

15          it's really impossible.  It requires too much 

16          time and expertise to do this.  They're very 

17          complicated and time-consuming cases, and 

18          they sometimes last several years.

19                 Our clients include homeowners that 

20          are at various stages of the foreclosure 

21          process, and the cases are absolutely 

22          heartbreaking.  We had a single mom whose 

23          child became gravely ill, and the child has 

24          to travel out of state for time-consuming 


 1          medical treatments.  And the mom spent quite 

 2          a bit of time away from work, so her salary 

 3          was reduced and she fell behind on her 

 4          mortgage payments.

 5                 We had a veteran who had a VA loan and 

 6          applied for disability but was denied.  While 

 7          he was fighting his appeal, he fell behind in 

 8          his mortgage payments.  Eventually, he was 

 9          granted the disability benefits, and he's now 

10          able to afford his monthly mortgage payments.  

11          But he's so far behind that he couldn't 

12          possibly catch up, nor will his lender even 

13          speak with him if he cannot pay the entire 

14          amount of arrears, including the fees.

15                 There's also the elderly woman whose 

16          name was not on the reverse mortgage that her 

17          husband took out before his death.  She faced 

18          eviction from her home of 40 years until we 

19          were able to reach a settlement with her 

20          bank.

21                 These are homeowners who are in a 

22          position to avoid foreclosure, but who needed 

23          the assistance of housing counseling and 

24          legal representation to work with the lender, 


 1          negotiate a settlement, and save their homes.

 2                 Since the inception of our foreclosure 

 3          program, The Legal Project has provided legal 

 4          assistance to over 2,750 homeowners and 

 5          prevented 217 foreclosures, ultimately 

 6          preserving homeownership and preventing 

 7          vacant and abandoned housing in our 

 8          communities.  In 2016 alone, 26,000 New York 

 9          families across the state were served through 

10          the Foreclosure Prevention Services Network.  

11          This network provided representation to more 

12          than 60 percent of homeowners in settlement 

13          conferences, obtaining loan modifications for 

14          30 percent of clients.

15                 There's some discussion of the fact 

16          that foreclosure issues may be declining.  

17          What we have seen in this state and certainly 

18          in this community is that is not the case.  

19          We have seen, since the inception of our 

20          program, an amazing 900 percent increase in 

21          the number of homeowners seeking our 

22          assistance.

23                 We know as well that the issue of 

24          reverse mortgages has also grown.  The 


 1          Governor did place some protections to 

 2          include reverse mortgages in the settlement 

 3          conferences, but if these individuals don't 

 4          have the assistance of an attorney and 

 5          housing counselor, these protections and 

 6          protections such as the MAP program that was 

 7          discussed earlier will not be meaningful.  

 8          They need that assistance.  They cannot 

 9          navigate this on their own.

10                 New York State has been in the 

11          forefront in the area of foreclosure 

12          prevention since 2008, when the then New York 

13          State Division of Housing and Community 

14          Renewal administered the program.  Just this 

15          past year, a trained and very experienced 

16          network of providers provided assistance in 

17          every single county and borough in New York 

18          State.  Statewide, we've helped more than 

19          26,000 homeowners at the very reasonable cost 

20          of $770 per family, which is amazingly 

21          reasonable.

22                 In terms of economic impact in 

23          New York State, in 2011 the Empire Justice 

24          Center conducted an in-depth study and 


 1          estimated that every foreclosure averted 

 2          saves the state, on average, $41,134 in 

 3          direct costs.  And if you include indirect 

 4          costs, the average savings goes up to 

 5          $186,695.  Just using the average for direct 

 6          costs, based on the 26,351 modifications 

 7          obtained through the network since 2012, 

 8          these foreclosure services have saved 

 9          $1.084 billion in New York State, which is 

10          astounding.

11                 We really must keep this network of 

12          experienced attorneys and housing counselors 

13          in order to avoid a disaster in our courts 

14          and in our communities.  We are respectfully 

15          requesting that the New York State Homes and 

16          Community Renewal again be tasked to 

17          administer this very successful program with 

18          an allocation of $10 million for the 

19          2017-2018 fiscal year and $20 million for the 

20          2018-2019 year, to allow for the continuity 

21          of services.

22                 Our state must continue to be in the 

23          forefront.  We've set a national standard for 

24          foreclosure prevention because of our 


 1          farsighted legislation and dedication to 

 2          providing homeowners with a strong network of 

 3          professional housing counselors and legal 

 4          services attorneys.  It's vital that we 

 5          continue to be there for our neighbors in 

 6          need, not only to help avoid the loss of 

 7          homes but also to avoid the plague of empty 

 8          zombie properties that can foster crime and 

 9          impact property values and local economies.  

10          This investment into our existing network of 

11          services is absolutely invaluable to our 

12          citizens and our communities.

13                 Thank you for your kind attention and 

14          consideration.  

15                 CHAIRMAN FARRELL:  Thank you.

16                 SENATOR KRUEGER:  Thank you.

17                 CHAIRWOMAN YOUNG:  Thank you.

18                 CHAIRMAN FARRELL:  Thank you very 

19          much.  

20                 Lara Kasper-Buckareff, director of 

21          foreclosure prevention, Legal Services of 

22          Hudson Valley.

23                 MS. KASPER-BUCKAREFF:  Good afternoon, 

24          Your Honors.  Thank you very much for the 


 1          opportunity to testify.

 2                 (Unintelligible interruption.)

 3                 MS. KASPER-BUCKAREFF:  Excuse me?

 4                 SENATOR KRUEGER:  We're not that 

 5          honorable.

 6                 (Laughter.)

 7                 CHAIRWOMAN YOUNG:  Speak for yourself.

 8                 (Laughter.)

 9                 ASSEMBLYMAN BARRON:  I'll take the 

10          honor.

11                 (Laughter.)

12                 MS. KASPER-BUCKAREFF:  My name is Lara 

13          Kasper-Buckareff.  I am an attorney and the 

14          director of foreclosure prevention at Legal 

15          Services of the Hudson Valley.  Legal 

16          Services is a nonprofit law firm that 

17          provides free, high-quality civil legal 

18          services in the mid-to-lower Hudson Valley.  

19          We cover seven counties and we have a 

20          foreclosure prevention unit -- currently 

21          funded by the Homeowner Protection Program -- 

22          that consists of nine attorneys and four 

23          paralegals.  

24                 You do have my written testimony, 


 1          which I will not be reading today.  I will be 

 2          briefly summarizing my testimony.

 3                 And I do want to point out that the 

 4          Hudson Valley has been hit particularly hard, 

 5          and the foreclosure crisis continues in the 

 6          Hudson Valley.  Three of the five worst 

 7          counties in terms of the foreclosure rate in 

 8          New York are located in the Hudson Valley.  

 9          Those counties are Orange, Putnam, and 

10          Rockland.  

11                 Right now there are 72,000 pending 

12          foreclosure cases in New York State's courts.  

13          That is 26 percent of the civil caseload.  

14          Last year there were 34,000 foreclosure 

15          filings across New York State.  This far 

16          exceeds the pre-crisis foreclosure level of 

17          26,706 foreclosures.  It's 27 percent higher 

18          right now than the pre-crisis level.  We 

19          still have a crisis.

20                 As mentioned by some of the other 

21          speakers, our principal funding for 

22          foreclosure prevention is going to be ending 

23          in September.  We are asking you to include 

24          funding in the budget to continue the vital 


 1          services that we provide.  Legal Services of 

 2          the Hudson Valley is one of the 31 legal 

 3          services across the state to provide these 

 4          free, high-quality services.  We work 

 5          collaboratively with the 63 housing 

 6          counseling agencies in this state, and we 

 7          provide these services, this network provides 

 8          these services, in every county in this 

 9          state.  

10                 Having worked on foreclosure cases at 

11          the beginning of the crisis up to now, I can 

12          tell you that with the implementation of the 

13          HOPP funding, it has made a world of 

14          difference for homeowners.  It is still 

15          nearly impossible for the average homeowner 

16          to be able to submit a complete loan 

17          modification application and get through that 

18          process successfully without the assistance 

19          of a housing counselor and a legal services 

20          provider.  And as mentioned, we do work 

21          collaboratively.  And we work pre-foreclosure 

22          to try to prevent a foreclosure from 

23          occurring in the first place.  

24                 Loan modifications save families 


 1          around $5,000 annually.  That enables people 

 2          to stay in their homes and for those people 

 3          who are able to stay in their homes because 

 4          of the loan modification, that gives them 

 5          extra money in their budget to now go out and 

 6          spend as consumers in this state, which is 

 7          good for the state.

 8                 In addition to mortgage foreclosure, 

 9          we're also avoiding tax foreclosure, and we 

10          do that by entering into repayment plans with 

11          the county that pay back the taxes with 

12          interest.  So that's a boon to taxpayers.  

13                 So I would echo what the other 

14          speakers have asked for.  I would 

15          respectfully request that you would continue 

16          these vital services by allocating $30 

17          million in the budget for foreclosure 

18          prevention services.  

19                 Thank you.

20                 CHAIRMAN FARRELL:  Thank you.  

21                 Any questions?

22                 CHAIRWOMAN YOUNG:  Thank you.

23                 SENATOR KRUEGER:  Thank you.

24                 MS. KASPER-BUCKAREFF:  Thank you.


 1                 CHAIRMAN FARRELL:  Jordan Zeranti, 

 2          attorney, Tanisha Bramwell, staff attorney, 

 3          Western New York Law Center.

 4                 MS. BRAMWELL:  Thank you for giving me 

 5          the opportunity to address you today on the 

 6          important subject of residential 

 7          foreclosures.  My name is Tanisha Bramwell, 

 8          and I'm an attorney at the Western New York 

 9          Law Center, a not-for-profit law and 

10          technology firm.  I represent homeowners in 

11          Western New York whose homes are in 

12          foreclosure.  

13                 Before I began working at the 

14          Law Center, I was an associate attorney and 

15          then the lead attorney in the loss mitigation 

16          department at a major law firm that 

17          represented banks who were foreclosing on 

18          homes.  

19                 Today I will address the impact that 

20          foreclosure has on individual homeowners and 

21          communities.  Jordan Zeranti will address why 

22          now, more than ever, we need to ensure the 

23          continued representation of homeowners in 

24          foreclosure.


 1                 Because of my experience on both sides 

 2          of the foreclosure issue, I'm very familiar 

 3          with the depth of the foreclosure problem in 

 4          New York State.  There were nearly 34,000 new 

 5          foreclosure filings in 2016, and there are 

 6          72,000 pending foreclosure cases in our 

 7          courts.  In fact, foreclosures comprise 

 8          26 percent of the Supreme Court's civil 

 9          caseload.  In Erie County alone, through 

10          September of last year, there were 1,008 new 

11          filings against residences, making 

12          Erie County the seventh highest county in the 

13          state with foreclosure filings.  Most of 

14          other counties ahead of Erie are downstate 

15          and more densely populated.  

16                 In the five counties we serve -- 

17          namely, Erie, Niagara, Genesee, Orleans and 

18          Wyoming -- there were 1,517 new foreclosure 

19          filings against homeowners through the first 

20          nine months of 2016, and there are thousands 

21          of older cases still making their way through 

22          the judicial process.  

23                 Our office currently receives funding 

24          administered through the Attorney General's 


 1          office, and we subcontract funds to the 

 2          Center for Elder Law and Justice in Buffalo 

 3          and the Legal Aid Bureau of Buffalo.  From 

 4          September 2012 to November 30th of 2016, the 

 5          three offices handled 2,820 cases and 

 6          prevented foreclosures in nearly half the 

 7          cases.  In the cases where we could not 

 8          prevent foreclosures, we helped homeowners 

 9          transition to other housing, often through 

10          short sales or private sales.  

11                 The people we help are not people who 

12          have overextended themselves by buying 

13          expensive homes they cannot afford.  The 

14          median listing price of a home in the Buffalo 

15          area is $110,000, and home prices were lower 

16          in previous years when the homes that are 

17          being foreclosed upon were purchased.  

18          According to statistics we keep on our cases, 

19          people fall behind on their mortgages for 

20          three main reasons:  illness, divorce, and 

21          unemployment.  Illnesses and unemployment are 

22          often temporary, and divorce settlements get 

23          worked out.  But when a homeowner falls 

24          90 days behind in mortgage payments, banks 


 1          have the right, which they exercise in the 

 2          majority of cases, to refuse any partial 

 3          payments.  The homeowner must pay the entire 

 4          amount of arrears, plus any additional fees, 

 5          including any legal fees.  This is something 

 6          that most homeowners cannot do, and they then 

 7          get caught up in the spiral of foreclosure.  

 8                 I know from my experience on both 

 9          sides of this issue that homeowners cannot 

10          get themselves out of this spiral without 

11          assistance.  When a foreclosure case is 

12          filed, they need an attorney, but most 

13          homeowners cannot afford one.  An attorney 

14          makes a dramatic difference.  

15                 In testimony offered before a hearing 

16          held by then-Chief Judge Lippman, one of our 

17          clients, a Vietnam veteran from Corfu, 

18          New York, in Genesee County, testified that 

19          after he was injured on a construction job, 

20          his bank refused to negotiate with him while 

21          he was waiting for disability payments.  

22          After his home was put into foreclosure, our 

23          office helped him negotiate a new payment 

24          rate on his home loan at a lower interest 


 1          rate.  He was able to remain in his home, and 

 2          his bank was able to continue to receive 

 3          payments on his mortgage.  

 4                 This is a typical case for us. 

 5          Homeowners fall behind in their payments, 

 6          cannot come up with the huge sum of past 

 7          mortgage payments, interest, and fees in one 

 8          check, and have no success in negotiating 

 9          with the lender or servicer.  Our 

10          representation makes a difference in these 

11          cases.  We truly keep people in their homes.  

12                 This representation is important to 

13          communities as well as to individual 

14          homeowners.  Foreclosed homes vary in 

15          appearance.  Many are not able to be returned 

16          to the market quickly.  If a lender has a 

17          large inventory of foreclosed homes, the home 

18          may sit for years and not receive attention. 

19          A foreclosed home might be boarded up and 

20          have large signs advertising it as 

21          bank-owned.  One property in a neighborhood 

22          that is going through the foreclosure process 

23          can negatively affect the entire 

24          neighborhood, because properties in 


 1          foreclosure bring property values down.  

 2                 Keeping homeowners in their homes 

 3          avoids these problems.  Families who have 

 4          raised their children in a neighborhood are 

 5          able to stay, family life is not disrupted, 

 6          and homeowners who care about the property 

 7          they own are able to keep their property and 

 8          maintain it.  Representation during the 

 9          foreclosure process is crucial for homeowners 

10          and for the stability of neighborhoods.  

11                 I hope that you can help ensure that 

12          our representation of homeowners can 

13          continue. Thank you.

14                 CHAIRMAN FARRELL:  Thank you very 

15          much.

16                 MS. ZERANTI:  All right, good 

17          afternoon -- or should I say good evening 

18          yet?

19                 SENATOR KRUEGER:  No, no, it's 

20          afternoon.

21                 (Laughter.)

22                 MS. ZERANTI:  Chairwoman Young, 

23          Chairman Farrell, Chairman Cymbrowitz, and 

24          distinguished members of the Legislature, 


 1          thank you for giving me this opportunity to 

 2          address you.  I promise I'll be short.  My 

 3          name is Jordan Zeranti, and I am an attorney 

 4          at the Western New York Law Center.  

 5                 As you have heard from my colleague, 

 6          we have represented thousands of homeowners 

 7          facing foreclosure in New York, and the 

 8          crisis is far from over.  

 9                 All provisions of  New York's Zombie 

10          Property and Foreclosure Prevention Act went 

11          into effect on December 20th.  Among the 

12          changes, Chapter 73 strengthens 

13          pre-foreclosure notices, which are sent at 

14          least 90 days before a foreclosure lawsuit.  

15          Now the notices must include a list of at 

16          least five nonprofit housing counseling 

17          agencies serving that homeowner's county.  

18                 However, there may no longer be 

19          housing counseling agencies to put on that 

20          list.  As you have heard, foreclosure funding 

21          is set to expire in September of this year. 

22          Without additional funding, several housing 

23          counseling agencies will no longer be able to 

24          offer their services.  The law strengthening 


 1          the pre-foreclosure notice will become moot.  

 2                 Furthermore, homeowners will lose the 

 3          protection of counsel.  If funds are not 

 4          allocated, several legal services agencies 

 5          will no longer be able to operate.  And as 

 6          distressed loan sales continue and more and 

 7          more nonbank servicers are entering the 

 8          market, cases are becoming more complicated. 

 9                 We, as legal services attorneys, help 

10          homeowners navigate complex foreclosure 

11          matters, and we hold banks accountable when 

12          they disregard mortgage servicing 

13          regulations.  This helps to balance the 

14          scales while also improving the efficiency of 

15          our court system.  

16                 Under CPLR 3408, courts are required 

17          to hold mandatory settlement conferences.  

18          The new law gives homeowners the opportunity 

19          to file a late answer within 30 days of their 

20          first conference.  Without funding, we would 

21          not be able to help homeowners draft answers 

22          nor would we be able to help them negotiate 

23          during the settlement conferences.  

24                 As many of our partners have stated, 


 1          there is already a fantastic foreclosure 

 2          prevention team in place, with 94 agencies.  

 3          This well-oiled network has kept thousands of 

 4          people in their homes and avoided the 

 5          creation of zombie properties, which drive 

 6          down property values and increase crime in 

 7          communities.  

 8                 It is especially important that this 

 9          network stay in place now that federal 

10          modification programs have ended.  With the 

11          ending of the HAMP program, a homeowner's 

12          ability to get a modification has 

13          significantly lessened.  This could lead to 

14          an influx of zombie foreclosures.  Funding is 

15          needed now more than ever to support 

16          foreclosure prevention services.  Without 

17          these services, there will be a void left for 

18          scammers to fill, and they'll be able to take 

19          advantage of desperate homeowners, as Senator 

20          Krueger pointed out earlier.

21                 We urge the Senate and Assembly to 

22          pass a budget that will dedicate $10 million 

23          for the remainder of this fiscal year, and 

24          $20 million through March of 2019.  We look 


 1          forward to working with you to serve our 

 2          communities.  Thank you.

 3                 CHAIRMAN FARRELL:  Thank you.

 4                 SENATOR KRUEGER:  Thank you.

 5                 CHAIRMAN FARRELL:  Susan Cotner, 

 6          executive director, HomeSmartNY.

 7                 MS. COTNER:  Thank you very much for 

 8          having me today.  Susan Cotner.  Again, I'm 

 9          executive director of the Affordable Housing 

10          Partnership, to clarify, which is a member of 

11          HomeSmartNY, which is a coalition of housing 

12          counseling agencies.  And we've been 

13          collaborating with legal services now for the 

14          past seems like 10 years, working together to 

15          fight foreclosures.  And we collaborate so 

16          well that our testimony is starting to sound 

17          an awful lot alike.  

18                 So I'm going to just bat cleanup here, 

19          I think, and summarize a couple of the main 

20          points that we want to make.  

21                 First and primarily, the foreclosure 

22          situation is still in crisis.  Here in the 

23          Capital Region, we get information on 

24          families that are receiving notices of intent 


 1          for foreclose, and that number spiked this 

 2          past month.  It was the highest number of 

 3          foreclose notices that have gone out in the 

 4          past two years.  So it's an ongoing issue and 

 5          concern.  We're not out of a crisis mode at 

 6          all.

 7                 Every day we're working with families 

 8          who have lost income because they've lost 

 9          their job, they've lost their health, they've 

10          lost a loved one, and now they're facing the 

11          loss of their home.  And it's a situation 

12          where foreclosure prevention services and 

13          trying to negotiate with their bank is a lot 

14          more complicated than ever before.  Families 

15          repeatedly tell us that they try to work 

16          things out with their bank and make no 

17          progress.  It wasn't really until they 

18          obtained services from legal service 

19          providers, experienced housing counselors, 

20          that they can really make any kind of 

21          progress and save their home.

22                 So the second issue is again on 

23          neighborhoods.  I know you've got several 

24          municipalities coming hat in hand.  We've got 


 1          a major deficit, property values are low.  

 2          The City of Albany has a thousand vacant 

 3          units as a result of foreclosures -- tax 

 4          foreclosure, bank foreclosure.  Again, with 

 5          services not in place, those will continue to 

 6          grow, continue to lose property taxes.  There 

 7          will be a need for increased city services to 

 8          deal with vacant housing as a result.

 9                 There is no other federal funding for 

10          our services.  As you can imagine, this 

11          administration in Washington is not at all 

12          sympathetic to the needs of families in our 

13          communities.  We cannot charge fees to 

14          customers who are facing such a financial 

15          distress.  So we're asking New York State 

16          again to continue their leadership role in 

17          providing funding for foreclosure prevention 

18          services -- again, $10 million for this 

19          upcoming fiscal year and $20 million for the 

20          next.  

21                 And we thank you for your 

22          consideration on that.  Thank you.

23                 CHAIRMAN FARRELL:  Thank you very 

24          much.


 1                 Now, Joseph Shuldiner, Municipal 

 2          Housing Authority, City of Yonkers.

 3                 MR. SHULDINER:  Thank you.  Good 

 4          afternoon.

 5                 CHAIRMAN FARRELL:  Should we get 

 6          papers from this young man?  

 7                 MR. SHULDINER:  Thank you for calling 

 8          me young.

 9                 CHAIRMAN FARRELL:  Everybody's young.

10                 SENATOR KRUEGER:  You are the last.

11                 MR. SHULDINER:  Yes, you saved the 

12          best for last.  

13                 CHAIRMAN FARRELL:  This is it, to 

14          close.

15                 CHAIRWOMAN YOUNG:  This is it.

16                 MR. SHULDINER:  Okay.  Chairwoman 

17          Young, Chairman Farrell, Chairman Cymbrowitz, 

18          members of the Assembly and State Senate, 

19          thank you for staying and for giving me this 

20          opportunity to speak.  

21                 My name is Joe Shuldiner, and I'm the 

22          executive director of the Municipal Housing 

23          Authority for the City of Yonkers.  I'm 

24          joined here by two of my board members, the 


 1          chairman of our board, Judge Doran, and 

 2          Jim Landy, another board member, as well as 

 3          Carlos Laboy, our director of development.  

 4                 I was pleased to hear other 

 5          organizations talk about the need to help 

 6          housing authorities in what they're facing, 

 7          and I just want to give you an idea of what 

 8          it is.  There are two things.  

 9                 One, like many housing authorities, we 

10          attempted to improve our housing by replacing 

11          it, by basically demolition and new 

12          construction.  That proved to be so expensive 

13          and time-consuming that we really had to look 

14          for something else.  Except for the 200 units 

15          of our housing that were built in response to 

16          the deseg lawsuit, all of our housing is 

17          40 years old or much older.  So what we had 

18          to do is really look at rehab.  

19                 We had an independent engineer come 

20          in, look at our stock, and they basically 

21          said we needed to make $175 million in 

22          capital improvements over the next 10 years.  

23          Under the present formula, we get about 

24          $3 million a year from HUD towards that.  So 


 1          in 10 years, we'd have $30 million to do 

 2          $175 million worth of work.  So clearly that 

 3          isn't going to work, and our buildings are in 

 4          real jeopardy.  

 5                 That basically forced us to pursue 

 6          HUD's rental assistance demonstration program 

 7          and try to leverage private funds.  But as 

 8          you know, that means use of tax credits and 

 9          bonds.  Even in the beginning, even when we 

10          applied last year, the tax credit and bonds 

11          were not sufficient; we needed gap financing.  

12          As you are probably aware, since the election 

13          the tax credit market has collapsed.  While 

14          investors are coming back into the tax credit 

15          market now, the prices are much lower.  So 

16          the need for gap financing is even greater 

17          than it was.  

18                 When HCR issued the RFP, they allowed 

19          for up to $40,000 a unit in gap funding, so 

20          we're seeking $70 million.  And again, that 

21          was before the value of tax credits fell.  

22                 So for us it's really absolutely 

23          necessary, critical, that the Legislature 

24          include additional funds in the budget for 


 1          this year and subsequent years for housing 

 2          authorities outside New York City to be able 

 3          to do this work.  In the unfinalized MOU, 

 4          there was $125 million over five years.  

 5          We're asking that you include this amount or 

 6          even more to support these kinds of efforts.  

 7                 Frankly, without this kind of funding, 

 8          we're totally stuck.  I mean, we have no idea 

 9          what we would do to preserve the housing.  

10          And our residents would suffer immeasurably, 

11          and we believe the authority and the state 

12          will have failed in their obligation to 

13          provide our residents with safe, decent and 

14          affordable housing.

15                 In the information we gave you, we 

16          gave you some of the real statistics that go 

17          along with this.  From my perspective, if we 

18          can actually pull this off, it's actually  

19          fantastic.  I mean, conceptually, to get the 

20          kind of money that we're talking about into 

21          our buildings, I tell the residents it's not 

22          once in a lifetime, it's a once in forever.  

23          Since these buildings were built, there's 

24          never been the opportunity to provide this 


 1          kind of funding.  But we desperately need the 

 2          gap financing to make it a reality.

 3                 Thank you, and I'll take any questions 

 4          you have.

 5                 CHAIRMAN FARRELL:  Thank you very 

 6          much.

 7                 CHAIRWOMAN YOUNG:  Questions?  

 8                 Thank you.

 9                 SENATOR KRUEGER:  Thank you.  Thank 

10          you for coming up.

11                 MR. SHULDINER:  Thank you.  

12                 CHAIRMAN FARRELL:  Thank you.  

13                 This is it.  This is the end of the 

14          last joint legislative budget hearing.  There 

15          were 13 of them, and they ended today.  Free 

16          at last.

17                 (Laughter.)

18                 (Whereupon, the budget hearing 

19          concluded at 3:16 p.m.)