War Over de Blasio Affordable Housing Plan Launches in Council

Mayor Bill de Blasio unveiling his affordable housing plan. (Photo: Ed Reed for Office of Mayor Bill de Blasio)

Mayor Bill de Blasio unveiling his affordable housing plan. (Photo: Ed Reed for Office of Mayor Bill de Blasio)

The City Council had one response to Mayor Bill de Blasio’s sweeping proposals to rezone the city for more affordable housing: this is not enough.

And the mayor’s top housing officials answered back: this is only the beginning.

The Council held its first hearing today on Mr. de Blasio’s mandatory inclusionary housing proposal, which would require developers citywide to set aside a percentage of apartments for below-market tenants in each new building.  But the administration had to fend off attacks from council members who argued even those apartments won’t be cheap enough for the lowest earners.

Mr. de Blasio’s team argued that the program would ensure the creation of middle class housing, and thus free up city subsidies that they could then devote solely to financing apartments for the poor.

“MIH is setting the floor, it is not the ceiling,” Alicia Glen, deputy mayor for housing, testified—giving a line she and other administration officials repeated several times. “Without MIH, we have less tools, less dollars, less opportunity.”

Protesters disrupted Ms. Glen’s testimony with chants of “de Blasio’s plan ain’t affordable for me,” and were escorted out of the Council chambers. Meanwhile, the Hotel Trades Council and the American Association of Retired Persons demonstrated in favor of the proposal outside City Hall.

“Those protesters that were here earlier, I want them to know we heard them loud and clear,” said Queens Councilman Donovan Richards, who, as chairman of the Subcommittee on Zoning and Franchises, oversaw the hearing.

The MIH plan would create a menu of three options for the Council to choose from when reviewing a new project. The first would obligate the builder to allocate a quarter of their new units to people making 60 percent of the federally-set area median income—meaning the apartments would be priced for a family of three making $47,000 annually.

The second would require the developer to set aside 30 percent of their new building for people making 80 percent of the area median income, or $62,000 for a family of three. The third—which troubled several council members—would allocate 30 percent of the apartments in a project to people making 120% of the AMI, or $93,000 for a family of three.

“I think my colleague said ‘the devil’s in the details.’ The way this plan is currently written, the devil’s actually in plain sight,” Brooklyn Councilman Jumaane Williams said.  “We do expect more, and we have a right to expect more. We supported this administration because we expected that it would push the envelope.”

But the administration insisted that saddling developers with too heavy an an affordability burden would scare off investors looking for a good return, bring new construction to halt and could result in lawsuits that could snarl the city in court battles for years.

“MIH is one tool. It’s one tool of many. You cannot ask MIH to solve all of the world’s problems. We are pushing as far as we can, legally and practically,” said Vicki Been, commissioner of the city Department of Housing Preservation and Development. “If we push too far, we get zero housing, right? Thirty percent of zero is zero. We don’t want that.”

Public Advocate Letitia James, who serves as the presiding officer of the Council, scoffed at such arguments. She compared Mr. de Blasio and the MIH plan to former Mayor Michael Bloomberg and his proposal to rezone Downtown Brooklyn, which sits in the district Ms. James represented in the Council for eight years, in 2004.

She recalled that Mr. Bloomberg’s housing team had also asserted that demanding more low-cost housing was financially unfeasible—and called the realization of the rezoning “disgraceful,” claiming it had led to displacement of longtime residents.

“I am still hearing the same arguments that the previous administration made to the City Council then,” she said. “It is unacceptable, and I reject this argument that all of the sudden we’re going to face all these negative consequences.”

The comment set off a public relations skirmish between the offices of the mayor and public advocate, who had been allies going back to their days in the Council. A spokesman to Mr. de Blasio surreptitiously reminded reporters that Ms. James had voted in favor of the Downtown Brooklyn rezoning while in the Council.

A source in Ms. James’ office responded by noting that the developer involved in that rezoning wound up charging far higher rents than it had promised the Council, which the insider labeled “bait and switch”—a term Ms. James also used on Twitter.

Brooklyn Councilman David Greenfield, who chairs the powerful Committee on Land Use, inquired about the plan’s viability given the recent expiration of the 421a tax exemption for developers. Many in the industry consider the abatement indispensable to the creation of affordable housing.

Ms. Glen answered that the administration still anticipates the State Legislature will resurrect the credit in some form.

“We do believe there will be a 421a-like—who knows what it will be called—exemption that will resurface as we got through the legislative session,” she said, arguing the failure to revive 421a would result in a massive shift toward condominium construction. “It’s simply too important for the City of New York not to have the ability to subsidize rental housing.”

Community and borough boards across the city have rejected all or most of the administration’s plan, as have most of the borough presidents. Hearings in the Council continue tomorrow.