Bad tenants can happen to good landlords
Q. Recently, the Mayor vetoed a bill proposed by the City Council to create greater transparency within HPD for the projects that they are financing. It is expected that the Council will override that veto. Do you think this is positive legislation for the housing industry?
The legislation you refer to is the HPD Transparency Bill, the intent of which is to provide better recourse for folks who purchase or rent affordable housing units in city-funded projects in which there are adverse construction conditions. The bill would require HPD to post information on its website about affordable housing projects it has financed.
The information would include the property’s address, who the developer was, how HPD awarded the financing to the builder and what affordable program was used to support the project. It also would require certain developers and contractors to file wage reports outlining who got paid what with respect to the construction of the building.
In a New York Post article recently, Speaker Christine Quinn and Finance Committee chairman Dominic Recchia endorse the bill and indicate that the City Council would indeed try to overturn the Mayor’s veto of this bill.
They claim that transparency in affordable housing is in the best interest of all involved. They argue that the bill’s opponents raise two main arguments.
The first that gathering and posting project information online is too onerous and the wage reporting process would be too expensive. They argue that addressing both of these issues are relatively easy to deal with. Their argument, that the process of providing this information is easy, is eerily reminiscent of the argument made on behalf rent regulated property owners who support means testing of tenants who receive rent regulation benefits. The Council has always objected to means testing because it would be “onerous and expensive”.
The industry has argued for years that rent regulation is a form of public subsidy (doled out by the private sector) and that tenants should be means tested to prove that they deserve this subsidy.
The argument made by many members of the city council is that means testing is too onerous to implement and that it is not fair for the tenants.
This is clearly a political argument and not a practical one.
When meeting with elected officials, I used to always ask if they were in favor of randomly handing out food stamps to folks. Of course, they would look at me as if I lost my mind and say that approach made no sense. I would then draw an analogy to the way rent subsidies are randomly handed out and would ask them if they would therefore support means testing for rent stabilized or rent controlled tenants. The answer was always a sharp “No” followed by a diatribe about a completely different topic.
Today, I skip over the food stamp analogy and ask politicians for one specific reason why they wouldn’t support means testing of regulated tenants and have never gotten a straight answer.
The fact is that, similar to the argument Ms. Quinn and Mr. Recchia make for requiring HPD and developers to comply with the HPD Transparency Bill, these disclosure requirements should apply to tenants in rent regulated housing.
The argument that it is too onerous to implement this system just doesn’t hold any water. Any tenant who receives Section 8 benefits must prove that they deserve those benefits. Any tenant who wishes to reside in the 20 percent component of an 80/20 property must prove that they qualify for the program.
Why shouldn’t every regulated tenant prove that they deserve a housing subsidy? Everyone who files a New York State Tax Return has proof of their income which can easily be used to determine qualifications to receive affordable housing. Why is it that substantiating a position or transparency is always focused on property owners as opposed to tenants?
The bias towards tenants in this city is overwhelming. Every year the Public Advocate compiles a list of the worst landlords in the city. I have yet to see a list of the worst tenants in the city. On a relative basis, the negative impact of bad tenants on good property owners is far more impactful than the impact of bad owners on good tenants. But that is another topic for another day.
The bottom line is, if the City Council is going to require transparency on one side of the scale, require that same transparency on the other.
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