NEW YORK STATE SENATE
INTRODUCER'S MEMORANDUM IN SUPPORT
submitted in accordance with Senate Rule VI. Sec 1
BILL NUMBER: S6430A REVISED 02/10/10
TITLE OF BILL:
An act to amend the public housing law, in relation to authorizing the New York city housing authority to enter into mixed-finance transactions in order to preserve the continued availability of low-income housing to public housing residents of the city of New York
This legislation would make these developments eligible for federal support.
SUMMARY OF PROVISIONS:
The bill authorizes the New York City Housing Authority to sell or lease all or part of the projects commonly known as Marlboro Houses, Chelsea Houses, Castle Hill Houses, 344 East 28th Street, Amsterdam Addition, Bushwick Houses, Stephen Wise Towers, Arthur H. Murphy Houses, Baychester Houses, Jonathan Williams Plaza, Drew-Hamilton Houses, Independence Towers, Rutgers Houses, Stapleton Houses and Manhattanville Houses, located in the city of New York, counties of Bronx, Kings, New York and Richmond, for the purpose of rehabilitation of the projects.
In particular, section 1 sets out the legislative findings. Section 2 authorizes the New York City Housing Authority, with the approval of the commissioner of housing and community renewal, to sell all or part of the part of the projects commonly known as Marlboro Houses, Chelsea Houses, Castle Hill Houses, 344 East 28th Street, Amsterdam Addition, Bushwick Houses, Stephen Wise Towers, Arthur H. Murphy Houses, Baychester Houses, Jonathan Williams Plaza, Drew-Hamilton Houses, Independence Towers, Rutgers Houses, Stapleton Houses and Manhattanville Houses in the city of New York for the purpose of rehabilitating the project for low income families. Section 3 establishes the guidelines for occupancy to ensure that the units remain public housing and that all laws rules and regulations applicable to federal public housing projects continue to apply after the sale or lease of the project. Section 4continues state subsidies for debt service on outstanding bonds, notes or other obligations. Section 5 is the effective date which provides that the act shall take immediately, provided, however, that the provisions of section 4 of this act shall apply to any debt service payments which become due after such date.
Currently, none of these developments are included in the formulas by which HUD provides NYCHA Operating and Capital subsidies. As a result, NYCHA must draw down from its regular Federal Operating fund and Capital fund and apply them to the State and City developments. This lack of dedicated Federal subsidy, and the elimination of State operating subsidies, has contributed to operating deficits at not just the State/City developments, but to the structural deficits NYCHA is experiencing on agency-wide bases.
The American Recovery and Reinvestment Act (ARRA) provides NYCHA with a one-time opportunity to address the deficits generated at the State/City developments and to ameliorate NYCHA's structural deficit. ARRA permits public housing authorities to bring additional units into the federal public housing portfolio and receive full Federal funding so long as such units are developed using ARRA funding. Since the physical needs of the State developments are so significant, non-Federal funds in addition to ARRA funds will be required to undertake and complete the level of necessary rehabilitation. In order to accomplish this, NYCHA will be required to employ HUD's mixed-finance approach for public housing developments, but MUST do so within the strict obligation and expenditure deadlines imposed by ARRA, on or no later than March 17, 2010.
None to the State
This act shall take effect immediately, provided, however, that the
provisions of subdivision 4 of section 402-b of the public housing law,
as added by section one of this act, shall apply to any debt service
payments which become due after such date.