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Comments from Bettina Damiani Good Jobs New York

to the New York State Housing Finance Agency

June 25 2002

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Regarding: 10 Liberty Street project and Battery Park City 19B project

Thank you for this opportunity to comment on the New York State Housing Financing Agency's proposal of projects at 10 Liberty Street and Battery Park City site 19B My name is Bettina Damiani director of Good Jobs New York a project of the Fiscal Policy Institute, which has offices in Albany and New York City and Good Jobs First, based in Washington, DC. Good Jobs New York promotes accountability to taxpayers in the use of economic development subsidies. After the attacks of September 11^th, we launched a project called "Reconstruction Watch" aimed to demystify the process by which literally billions of dollars would be allocated New York City .  Information can be found at www.reconstructionwatch.net

We are greatly concerned that the New York State Housing Finance Agency proposes using the state's Liberty Bond housing allocation in a way that fails to respond to the need for mixed-income housing, with a substantial number of units available to middle and low income tenants. In addition, there has been questionable public input regarding how NYS Housing Finance Agency should implement these Liberty Bonds. We urge NYS Housing Finance Agency to rise to the occasion by deferring approval on these projects until HFA staff can develop a Liberty Bond program that addresses the needs of New York.

A Missed Opportunity

Given the need for affordable housing in New York City we are extremely disappointed to team that projects financed with Liberty Bonds have set aside only 5% of their units for non-market rental rates. In addition, both these projects target the 5% non-market units to be affordable to households earning up to 150% of the NYC Area Median Income. That measure effectively bars the majority of New Yorkers from living in these units since a family of four would need to earn $94,200 a year. However, it is worth mentioning that many of the proposed apartments cannot accommodate a family of four, since the majority of them are one and two-bedrooms.

Considering HFA's current income requirement for affordable units is 50% of the NYC Area Median Income (AMI) it is especially discouraging that the income requirements under the Agency's Liberty Bond Program is three times that (150% of the AMI).

As others here tonight will testify there is a colossal need for low and middle-income housing. The current HFA Liberty Bond program allocation of 95% of the units in the proposed project to market rate and 5% to moderate income is a far cry from the usual standards of HFA public financing for residential projects, which provides 80% market and 20% low income units.

Public Entities, Public Purpose

While the current allocation of Liberty Bonds does not require that a percentage of units be set aside for low or moderate income tenants, or even what the income requirements will be, the New York State HFA has a moral obligation to New Yorkers -all of them.  It is worth pointing out that the "public purpose" listed in the project plan refers to "...the Agency's Liberty Bond Program." Yet, we are unsure whom this definition of public purpose is expected to benefit. A new definition should be created, one that includes comments from the public as to how these bonds can benefit New York City.

The proposed projects are an insult to the intent of the "public purpose" guidelines that have informed HFA practice in the past. We urge the board to insist that these deals be re-structured to deliver more in exchange for what they are being given.