Encourage upward mobility and free up apartments to people on the waitlist.
The sheer physical problems of New York City’s public housing system — with 174,000 units, by far the nation’s largest — are clearly the number one issue facing new NYCHA CEO Gregory Russ.
But if New York is truly to make the best use of our largest reservoir of affordable housing, physical improvements are just part of the challenge. NYCHA’s shortcomings go beyond its profound maintenance failures. Rather than providing short-term aid to people seeking upward mobility, its policies promote long-term dependence.
NYCHA is not effectively allocating the units it currently has available, even as 177,504 households languish on the waiting list. Start with how long tenants stay. The latest data shows 30% of households have been in the system 20 years or more. The median is 19 years — more than double the national rate for subsidized housing of nine years.
In part as a result of this remarkably low turnover, a third of all NYCHA tenants are “over-housed” — that is, they have more bedrooms than they need — but pay no additional rent for a larger unit. By contrast, 16% of the city’s households in poverty, who would qualify for public housing were it available, live in overcrowded conditions.
In fact, more than one in 10 NYCHA households have incomes greater than the New York City median.
I propose three new policies to help modernize NYCHA to reduce long-term dependence and better serve the city’s newcomers. Short-term assistance for new tenants, flat-rate leases and buyouts for longer-term tenants could significantly increase the turnover in the system.
Much of the misallocation of NYCHA units stems from the fact that there is no limit on how long tenants can stay in the system. No current tenants should face such a cap — but those on the waiting list should get priority if they agree to a five-year limit. In exchange, they should get an important financial incentive: a fixed-rent lease.
When coupled with services like financial counseling, this model has been shown to help households increase their income, reduce public assistance payments and even increase “early exits” from public housing.
Currently, the more income one earns, the more the rent goes up. Hard as it is to believe, between January 2018 and January 2019, 83,216 NYCHA households experienced a rent increase of $112, or 22% on average. Their rent increased, on average, from $519 to $631 as their average income increased 16% ($4,271), from $26,019 to $30,290.
A better approach would be to let new tenants who agree to a time limit pay the same rent regardless of income increases. This would allow them to save for life post-NYCHA.
The guiding principle of this approach is upward mobility. We should encourage those in public housing to increase their incomes while receiving assistance, rather than expecting them to remain dependent for the long term.
To encourage long-term tenants to consider leaving the system — and thus make units available for those on the waiting list, including those in the city’s homeless shelter system — NYCHA should experiment with voluntary tenant buyouts. Yes, that means paying tenants to vacate their units.
Even a relatively small $50 million relocation fund could make a big difference. For context, NYCHA currently spends $30 million a year on “sidewalk sheds,” which cover building entrances to protect tenants from debris that might fall from decaying facades.
All of these approaches could be part of the city’s pending plan to rebuild thousands of units through the use of the federal Rental Assistance Demonstration program. NYCHA has applied for authorization from HUD to include 7,725 units in 64 public housing developments in the program, which not only brings private capital in for renovations but turns tenants into holders of housing vouchers which they could use elsewhere. This makes the buyout option even more palatable.
The world has changed around it while NYCHA has remained the same. The time has come for bold experimentation.
This piece originally appeared at the New York Daily News
Howard Husock is vice president for research and publications at the Manhattan Institute and author of the new book, Who Killed Civil Society? This piece is based on his new report, “Ending NYCHA’s Dependence Trap.”
Photo: Spencer Platt/Getty Images