NYC’s disappearing affordable housing

ROBERT E. CORNEGY JR.  | 10/25/2018, 12:30 p.m.
In the Brooklyn neighborhoods I represent, homeowners are increasingly subject to insidious fraud scams and deed theft, and they face ...
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In the Brooklyn neighborhoods I represent, homeowners are increasingly subject to insidious fraud scams and deed theft, and they face the ever-present risk of foreclosure because of the lingering effects of the financial crisis. At the same time, rapidly rising rents are pricing many longtime residents out of the community and making an affordable home of any kind harder than ever to find. Against this backdrop, it is perhaps not surprising that a series of recent articles drawing fire on a relatively unknown city program called Third Party Transfer has fanned the flames of a growing feeling that enough is enough.

As the City Council member representing the district where Marlene Saunders, a longtime homeowner and active member of the community, almost lost her home, I, too, was alarmed and dismayed.  

I am familiar with the Third Party Transfer Program, which was introduced back in 1996 as a way to improve the conditions for residents in financially and physically distressed properties that might not be subject to the tax lien sale.  Unlike the tax lien sale, the goal of TPT program is intended to get owners into a payment plan and make sure that violations are corrected, and if not, to transfer properties to local community-based organizations as affordable housing. As chair of the Housing and Building Committee, I worked closely with the city’s Department of Housing Preservation and Development to make sure that no stone was left unturned before a property was transferred through the program.   

I called a hearing on the issue in April and verified that over the past three years, the city reached out more than 70 times to each owner in the TPT round—including sending letters, making robocalls, organizing resource fairs and distributing flyers in the buildings—and offered various forms of assistance, including tax exemptions, payment plans, technical assistance, repair loans, etc. I am also organizing a series of community meetings for the city to explain the process to owners and residents and address their concerns. 

As a result, almost 80 percent of the buildings that started in TPT in 2015 exited the program. Saunders’ building was one of them, but there was a processing error that prevented it from being pulled. As soon as I heard of Saunders’ plight, I notified the agency of the mistake, and the transfer was almost immediately reversed. 

Although Saunders’ home is by no means representative of the typical building in the program, it met the statutory criteria for inclusion, and that is an area of concern. However, the wholesale criticism of TPT misses the real purpose of the program: to protect tenants. TPT is a tool of last resort for buildings that too often fly under the radar, leaving residents in precarious or even unsafe conditions. Although the goal of the program is to get the buildings back on track, if that is not possible, the action ensures the tenants get to remain as rent stabilized tenants in fully renovated apartments, with the added protections that affordable housing provides. In cases such as 25 MacDonough St., where residents of this rental building have petitioned to become a co-op, it can actually create a path to homeownership.