Forum raises questions, fears about NYCHA’s Section 8 plan

New York City Councilmember Rosie Mendez translates the proceedings for Spanish-speaking residents attending a Section 8 housing forum sponsored by State Senator Tom Duane last Thursday at the Hudson Guild’s Elliott Center.

By Chris Lombardi

Colin Casey, aide to State Senator Tom Duane, looked out on the community room at Hudson Guild’s Elliott Center last Thursday with a rueful smile. Voices from all around the room sent out sharp questions about public housing: “Why let the handymen go? The caretakers go?” Finally he stood from his chair, and spoke slowly.

“We could meet all month about what’s wrong with housing,” Casey said quietly. “But people came here to learn about Section 8.”

Casey, who was taking part in a forum on what is being billed as the Voluntary Section 8 Transition Program, was referring to the controversial plan by New York City Housing Authority (NYCHA) to convert 21 of its 300-plus developments, including Chelsea Houses, to the federal Section 8 program. The plan, which would use funds from Section 8 to stem NYCHA’s looming $250 million deficit, has confused many tenants and outraged advocates, who believe the deficit can be addressed by getting the city and state to contribute operating funds for those developments.

At Thursday’s public meeting, advocates said that the Voluntary Section 8 Transition Program would change the rules for Chelsea House tenants and decrease the number of housing vouchers available for other low-income people. Together with state, federal and city officials, including Duane and City Councilmember Rosie Mendez, advocates also urged tenants to take part in a lobbying day in Albany on March 20 to demand state funds for NYCHA, and all stressed that they’ll continue to press for more ongoing public support for public housing.

A hard early spring rain had chilled the large, airy community room at the Elliott Center and delayed Duane’s arrival from Albany, giving the forum’s opening a loose, improvisational feel. The 50 to 60 residents in attendance applauded as Rosie Mendez urged residents to go to Albany but still raised their hands about tangential issues such as community-service requirements and a current lack of heat in their apartments. Finally, with the assist from Casey, the focus turned more firmly to Section 8, and what it might means to tenants at Chelsea Houses.

Judith Goldiner, of the Legal Aid Society, first took the group through a history lesson: “how we got here, and how we need to get out.” In the middle of her talk, Duane arrived, sitting quietly next to her and rubbing his hands for warmth.

The New York City Housing Authority, established in 1934, houses more than 600,000 residents in 179,000 apartments, spread across 344 public housing complexes throughout the five boroughs. Of the 344, most, like Fulton Houses, were built by the federal government in the 1930s and 1940s and still receive federal subsidies from the U.S. Department of Housing and Urban Development (HUD), while 21 newer complexes do not. “Fifteen developments were built by the state, like Chelsea Houses,” Goldiner explained, and six others by the city. But neither the city nor the state includes operating subsidies for those 21 developments in its budget, she added, which may explain some of NYCHA’s current budget crisis.

That crisis is quite real, according to the New York City Independent Budget Office: Expenses have risen in the past decade, while operating subsidies once provided by the city and state have disappeared. State aid for the 15 developments under its authority was eliminated in 1998 by the administration of Governor George Pataki, while annual subsidies from New York City were essentially eliminated in 2004. These cuts were made, in part, on the understanding that NYCHA had enormous reserves. But now those reserves have been essentially exhausted, while NYCHA has spread its HUD funding throughout the system to cover essential services in all its developments. Last year, the deficit for the 15 state developments, like Chelsea Houses, stood at $60 million, and predictions for NYCHA’s overall deficit for next year run as high as $250 million.

All of this prompted the agency to unveil a seven-point “Plan to Preserve Public Housing” last year, which included rent increases, maintenance extensions (e.g., painting some lobbies less frequently), a merging of its three federal funding streams, and the use of 8,400 Section 8 vouchers to help fund the 21 city and state complexes. Under Section 8, landlords can charge up to a predetermined “fair market value” for an apartment (currently $1,083 for a one-bedroom), but tenants need only pay up to one-third of their income toward their rent, while HUD pays the balance. Under the new plan, any new tenants who move into one of the 21 developments built by either the city or the state would receive one of the 8,400 vouchers, while their apartment would become a “Section 8 apartment,” as NYCHA spokesman Howard Marder called it last week.

If a NYCHA tenant came under Section 8, Marder explained, the agency could then charge the federal government market rate, and the resulting extra cash from HUD would go directly to NYCHA, subsidizing the entire development.

The plan came under fire from the beginning.

In May 2006, a letter to Housing Authority President Tino Hernandez, calling the idea offensive in the light of New York’s over 100,000-person Section 8 waiting list, was signed by 21 City Councilmembers, eight members of Congress including Rep. Jerrold Nadler, and representatives of religious groups and public-housing tenant organizations.

The proposal went forward anyway, with NYCHA submitting its request to HUD last fall, hoping for approval by the first of this year. That approval has yet been granted, but the authority has held more than 200 meetings with tenant associations, community boards and local politicians, calling the program its best hope for financial stability. They have also tried to prepare tenants with flyers in mailboxes and cheerful lists of Frequently Asked Questions. Even without federal approval, NYCHA is compiling a list of “potentially interested” tenants to be contacted if the plan is approved.

To judge from the group at the forum, the result of all this for tenants has been confusion—and fear. Phyllis Gonzales, president of the Chelsea Houses Tenants Association, told the panel that “some folks are telling the people: Anything you do from now on, if you want to move or transfer inside the development, you need to do it as part of the process of moving to Section 8.”

“That’s strange,” said Legal Aid’s Judith Goldiner. “It can’t be true, because the federal government hasn’t even approved their plan yet!”

After describing the outlines of the plan and the origins of NYCHA’s budget crisis, Goldiner returned to the evening’s other theme: that residents need to call on their elected officials to provide for the developments under their control.

“The six city developments need $20 million in operating subsidies,” she said. “You need to tell [City Council] Speaker Quinn and Mayor Bloomberg: Those are the city’s children, and the city has to take care of them.” Likewise for the 15 state developments, she said, which need $62 million. “Why is Spitzer being a deadbeat dad?” If tenants attending the forum couldn’t go to Albany, she said, “then get on the phone. Call Governor Spitzer. Tell him how disappointed you are.”

Miguel Acevedo, director of Fulton Youth for the Future, raised his hand in exasperation. “We came out last year, we fought, and we rallied. They said the deficit was $165 million last year, this year $250 million. But nothing changes!”

“I will tell you, they do have a deficit,” said Goldiner. “That’s why they want to use 8,400 Section 8 vouchers. What that means is, 8,400 fewer low-income people—who are not now in public housing—will be able to get assistance.”

Then Jacqueline Burger, of the Community Service Society, a citywide anti-poverty agency, took the podium, citing a list of reasons that tenants should be skeptical of the Section 8 option. For example, she pointed out, many longtime tenants (the average length a NYCHA tenancy is 20 years) pay a “ceiling rent that is often less than 30 percent of their income, and thus their rent would go up under Section 8. They could lose their subsidy if their income rises, and would be more likely to be forced to move if their apartment were “under-occupied.”

If a tenant already wanted to move to a federal development, Burger said, accepting Section 8 might make sense, but they should consider very carefully before accepting a voucher. If they wanted to take their voucher and move out of NYCHA housing, she added, “you’d have to find a landlord that accepts Section 8, which means you’d almost certainly have to leave Manhattan.” With housing prices in Chelsea reaching into the stratosphere, she said, the odds of staying in the neighborhood were quite minimal.

Those rising Chelsea rents hung like a ghost over much of the forum. “We’re all concerned,” said Acevedo, “that what they really want to do is sell our buildings to developers—to force us out.” Mendez, who had opened the forum with her passionate call to lobby in Albany, said similarly: “If we don’t get the funding we need, they may be forced to sell.”

Duane, who spent most of the forum listening to the presentations, rushed to calm those fears. “There are no plans,” he said slowly and carefully, “to sell any NYCHA buildings. Not in Chelsea, not anywhere else.”

Duane, who has already signed numerous letters to Governor Spitzer, Mayor Bloomberg and NYCHA officials opposing the Section 8 plan, then promised to push for the additional state funding in Albany. He also mentioned that Senator Chuck Schumer and Congresswoman Nydia Velasquez were pressing a bill to bring all the developments under the federal umbrella—and to increase subsidies.

Absent the needed funding however, NYCHA’s budget gap persists, and with it the fear that the complexes won’t last. Authority officials see their voucher proposal as the only way out.

“Without those 8,400 vouchers,” Marder said, “you have 20,000 families [in Chelsea Houses] who might not have housing.”