Observer » Shaun Donovan

Shaun Donovan In New York This Morning to Announce New Harlem Children's Zone School

Jeremy B. White — Wed, 06 Apr 2011 17:09:11 -0400

Not every school's opening brings together the Secretary of Housing and Urban Development and titans of finance, but few schools command the lavish praise and private-public support of Geoffrey Canada's Harlem Children's Zone.

Shaun Donovan joined Canada, Education Chancellor Cathie Black, Mayor Michael Bloomberg and donors from Goldman Sachs this morning to break ground on a new charter school and community center, which they lauded as both an educational boon and a community revitalization effort.

The $100 million, 135,000 square foot development is funded by a $60 million federal Department of Education matching grant, and a combined $26 million from Google and Goldman Sachs.

Bloomberg recounted rejecting a job offer from Goldman Sachs when he was looking for his first employment out of graduate school, joking that "I'm not turning you down this time -- we will take your money." His praise of Goldman as a "model of good corporate citizenship" mirrored the steady stream of plaudits for Canada, whom speaker after speaker hailed as a visionary.

Stanley Druckenmiller, chairman of the Harlem Children Zone's Board, said the corporate largesse that has helped to sustain Harlem Children Zone's continued growth is a function of student success, saying that "these kids will perform -- you level the playing field, they proved it here and the money will roll in."

After the event, reporters surrounded Black near the dirt pile and tried to squeeze in a few questions.

Black reaffirmed her commitment to school choice--"We want to support options and choices for parents and that's what this is all about," she said--before an aide abruptly shut things down. A question about her lackluster approval ratings went unanswered.

Consistent backing for charters by Black, Bloomberg and Black's predecessor Joel Klein -- along with Canada's widely touted program -- has made the city a national model for the charter school movement, a cause the Obama administration has supported through measures such as the $60 million DOE grant.

Like other Harlem Children Zone schools, the development will offer a comprehensive menu of services to students, including free access to healthcare and a social work team. The New York City Housing Authority has partnered with Harlem Children's Zone on the project, hoping that the school and community center will raise the standard of living in the public housing projects where they are located by bolstering public health and safety.

"We can usher in a new era for the families of the St. Nicholas and the Lincoln Houses by reconnecting this community to the larger community around it," Donovan said, adding that "there are too many communities where you can predict the lifespan of a child by the zip code that they grow up in."

Bloomberg's New Housing Commissioner

Azi Paybarah — Thu, 24 Mar 2011 13:47:01 -0400

It's Mathew Wambua, a top aide at the New York City Housing Development Corporation, according to Adam Lisberg, who notes the challenges the new guy will face.

"Former commissioner Shaun Donovan set big affordable housing goals before President Obama tapped him as secretary of Housing and Urban Development. The timeline for the plan to preserve or build 165,000 new affordable housing units has been extended by a year, and will create fewer new apartments than first thought, but the city says it remains on track.
"Still, it will raise eyebrows in the housing world that Bloomberg is going deep into his own ranks, instead of out into the corporate or non-profit housing world, to lead one of his administration's most challenging agencies -- especially with affordable-housing battles like the 421-a extension and rent law renewal raging in Albany."

The Obama Administration Wants You to Keep Your Home

Mike Taylor — Mon, 30 Aug 2010 13:20:07 -0400

Following last week's dismal reports on the U.S. housing market's July performance, the Obama administration indicated over the weekend it's ready to pour additional money into the hole of debt and unemployment where many homeowners currently find themselves. In the offing: emergency loans for the jobless and government assistance in home refinancing.

But will the $8,000 tax credit for new homebuyers, a measure that may have helped prop up the housing market before a disconcerting July, come back? Too soon to say, said Housing and Urban Development secretary Shaun Donovan on CNN's "State of the Union With Candy Crowley" on Sunday. Okay, then, will the government use lasers, or at least laser analogies, to fix the housing problem?

"We're going to be focused like a laser on where the housing market is moving going forward, and we are going to go everywhere we can to make sure this market stabilizes and recovers," said Donovan.

Hard to get much more focused than a laser. Or much less focused than the Department of Housing and Urban Development. We're eager to see where on that spectrum HUD finds itself in the next couple months.

The New Yorkers Shaping Obama’s Urban Policy

Eliot Brown — Thu, 19 Feb 2009 19:45:08 -0400

In terms of urban policy, the Obama administration certainly will not be lacking input from New Yorkers. With the new appointments announced today in Washington, the three voices with arguably the most influence on urban affairs nationally are officials from New York.

The Obama administration has repeatedly made clear that urban areas will get fresh attention. On everything from transportation policy to housing laws and incentives, cities have long complained about receiving the short end of the stick from Washington, with suburbs grabbing the spotlight. At least among urban affairs wonks, there is a feeling that the Obama administration will change that, given his rhetoric in the campaign and early appointments (as well as the president's own big-city background).

Urban policy appointees from New York, so far:

Shaun Donovan, the city’s former housing commissioner, has a highly influential seat as Secretary of the Department of Housing and Urban Development.

Derek Douglas, the director of New York State’s Washington, D.C., advocacy office under governors Spitzer and Paterson, will be the Special Assistant for Urban Affairs to President Barack Obama.

Bronx Borough President Adolfo Carrion will be the White House Director of Urban Affairs.

More here.

For Urban Policy, Obama Loves New Yorkers

Eliot Brown — Thu, 19 Feb 2009 19:39:27 -0400

In terms of urban policy, the Obama administration certainly will not be lacking input from New Yorkers. With new appointments announced today in Washington, it doesn’t escape notice that now the three voices with probably the most influence on urban affairs nationally are officials from New York.

That’s no insignificant step, given that the Obama administration has repeatedly made clear that urban areas will get fresh attention. On everything from transportation policy to housing laws and incentives, cities have long complained about receiving the short end of the stick from Washington, with suburbs grabbing the spotlight. At least among urban affairs wonks, there is a feeling that the Obama administration will change that, given his rhetoric in the campaign and early appointments (as well as the president's own big-city background).

Urban policy appointees from New York, so far:

Shaun Donovan, the city’s former housing commissioner, has a highly influential seat as secretary of the Department of Housing and Urban Development.

Derek Douglas, the director of New York State’s Washington, D.C., advocacy office under governors Spitzer and Paterson, will be the special assistant for Urban Affairs to President Barack Obama.

Bronx Borough President Adolfo Carrion will be the White House director of Urban Affairs. Bruce Katz, who heads up urban policy at the Brookings Institution and has been advising the Obama administration on this position, last week described his vision of Mr. Carrion’s new office as a somewhat bureaucratic position, meant to help coordination across various relevant federal departments. Those agencies can often act in silos, he said at an NYU forum in New York, and can contradict each other on urban policies.

Bloomberg Taps Former Insider Cestero for Top Housing Job

Eliot Brown — Fri, 13 Feb 2009 16:36:57 -0400

Mayor Bloomberg has tapped a former deputy commissioner for the city’s top housing job, as he announced this morning that Rafael Cestero will be the new commissioner of the Department of Housing Preservation and Development.

Mr. Cestero, who left the city for the nonprofit Enterprise in 2007, takes the spot recently left vacant by Shaun Donovan, who became President Obama's HUD secretary.

Formerly the deputy commissioner for development, Mr. Cestero had a large hand in crafting and managing the city’s ambitious affordable housing plan.

Many tools within that plan, however, were aimed to leverage a strong market to create tens of thousands of units of below-market-rate housing. Now many of the plan's tools and programs have been paralyzed or weakened, leaving Mr. Cestero with a partially completed plan that faces major challenges.

The use of inclusionary housing, for instance, has slowed dramatically as it relies on developers building in newly rezoned areas; the Federal Low Income Housing Tax Credit, used for numerous programs citywide, has been paralyzed by the economic crisis, delivering far less subsidy to affordable housing developers; and the city’s budget office, which frequently sparred with Mr. Donovan over using capital money for his housing plan, has cut the size of the city’s capital plan by 30 percent after effectively cutting it last year by 20 percent, putting direct government subsidy in shorter supply.

Mr. Cestero, appearing alongside Mayor Bloomberg this morning, acknowledged that change would be needed, saying officials would have to “roll up our sleeves and think about new ways to get it done.”

Mayor Bloomberg repeated his commitment to his 10-year housing plan to create and preserve 165,000 units citywide, which has been stretched out by a year.

With counsel from Mr. Donovan, city officials honed in on Mr. Cestero weeks ago, though the announcement did not come until this morning. Also at today's announcement, Mr. Bloomberg indicated he was opposed to the repeal of the Urstadt Law, which would give the city, not Albany, control over much of its housing regulation policy. As Azi Paybarah notes at PolitickerNY, that stance puts him at odds with Assembly Speaker Sheldon Silver and Council Speaker Christine Quinn.

Bloomberg Announces New Housing Commissioner

Azi Paybarah — Fri, 13 Feb 2009 14:56:24 -0400

Bloomberg just named Rafael Cestero as his new housing commissioner in a press conference at City Hall.

Cestero has been working as the senior vice president and chief program officer of a housing nonprofit called Enterprise Community Partners, where he oversaw the organization's national housing program. Previously, he worked at the city's department of housing as a deputy commissioner from 2004 to 2007.

Cestero will replace Shaun Donovan, who was chosen as Barack Obama's HUD secretary.

Donovan Confirmed as HUD Secretary

Eliot Brown — Fri, 23 Jan 2009 15:21:09 -0400

Shaun Donovan, the city’s housing commissioner since 2004, has been confirmed as President Obama’s Housing and Urban Development secretary.

The confirmation in the U.S. Senate happened late last night, ending his stint at the city's Department of Housing Preservation and Development.

In a statement, Mayor Bloomberg said, “The country is fortunate to have someone of Shaun’s intelligence, passion and determination to lead the Department of Housing and Urban Development.”

The Bloomberg administration has not yet named a replacement for Mr. Donovan, though earlier this week, two people familiar with the hiring search said Rafael Cestero, a former deputy commissioner at HPD, was the leading candidate.

Bloomberg A.D.

Eliot Brown — Wed, 21 Jan 2009 00:01:52 -0400

Shaun Donovan looked very much at ease during his Jan. 13 confirmation hearing in the Dirksen Senate Office Building. The 42-year-old leaned forward onto a green-clothed table in front of the Senate Banking Committee, eloquent and gracious in his answers, sharp and timely in his policy points, an apparent shoo-in to be secretary of Housing and Urban Development who knows he’s just that.

Assuming he is indeed confirmed, Mr. Donovan’s departure as commissioner of the city’s Department of Housing Preservation and Development marks the end of an era for housing policy in the Bloomberg administration during a time of economic turmoil.

The architect of the mayor’s housing strategy has been known for his commitment to using the market to help solve affordability problems, pushing a cocktail of programs and incentives that, in large part, rode the building boom and a robust lending climate to leverage creation of tens of thousands of units of below-market-rate housing.

But the city now faces a drastically different economy and will soon get new leadership at HPD. While no announcement has been made by the Bloomberg administration, multiple people familiar with the decision-making said a former HPD deputy commissioner, Rafael Cestero, is the leading candidate.

Regardless of the individual, many housing advocacy groups and other observers say they expect a shift in housing policy in order to adapt to the economic conditions.

“You had a plan, and the plan was designed in a very different economic time, and it was really about capturing the excess value in the marketplace and directing it toward affordable housing,” said Jerilyn Perine, a former HPD commissioner who designed an earlier version of the mayor’s housing plan. “You don’t have that excess in the marketplace anymore.”

“I think you’ve got to look at the plan in the context of a very changing environment,” added Ms. Perine, who is now director of the affordability-focused policy group Citizens Housing and Planning Council. “Where would the city’s resources best be spent, and what are the primary objectives now?”

MR. DONOVAN ARRIVED at his position at HPD as the number of new apartments being built in the city began soaring. Land prices and rents were shooting upward, the city’s population was swelling, and construction prices were up as well, a storm of conditions that made for a desperate need for more affordable housing.

A creative and adept housing policy die-hard, Mr. Donovan crafted a 10-year affordability strategy that laid out tools to build about 92,000 new below-market-rate units and to preserve about 73,000 units. The $7.5 billion plan, hailed as visionary by housing advocates, offered an array of programs for both low- and middle-income families. The housing programs for the latter were particularly notable, as federal incentives almost exclusively cater to low-income families given that the majority of the country, unlike New York, does not have a housing shortage for middle-income earners.

While the plan was varied and contained initiatives that would spawn housing in bad times or good, much of the new production was slated to come from various incentives that relied on a hot market.

Mr. Donovan implemented the inclusionary zoning program, for instance, which offered developers the chance to build bigger in newly rezoned areas if they set aside 20 percent of the units as affordable rentals. Thousands of units from Harlem to the far West Side to Williamsburg were expected to be created with this tool.

Other programs supplemented the Federal Low Income Housing Tax Credit program to spur development of low-income housing, a tool that relied on financial firms buying the credits to offset taxes on their profits.

And part of the plan relied on affordability requirements in a few key mega-developments, such as the Atlantic Yards project in Brooklyn that planned over 6,400 units of housing, more than 2,200 of which would be for low- or middle-income families.

But with financing in short supply and the market for new development at a standstill, affordable housing production is taking a hit across the board. Development in the rezoned areas is expected to proceed far more gradually; demand for the federal tax credits has dropped as banks have no profits on which to be taxed; and large projects including Atlantic Yards are stalled with an uncertain future.

“We are facing some real challenges in a way that we’ve never faced them before,” said Bernie Carr, the executive director of an industry group, the New York State Association for Affordable Housing. “This is the first time that the financial markets have really been creating an issue for affordable housing.”

Already, the Bloomberg administration has stretched out its 10-year plan an extra year, now slated to be completed by 2014. The city has exceeded its targets for the preservation component, and the new production component, which was always expected to expand in the second half of the plan, is now expected to lag in the economy. As of this fall, HPD reported it had started 31,640 of the 91,637 new units outlined in the plan.

Housing advocates stress that a new emphasis is needed on adding affordability provisions as part of a response to the mortgage crisis, particularly with multifamily apartment buildings. Tens of thousands of apartments were bought in recent years by highly leveraged landlords who had optimistic assumptions about rents.

With rents no longer going up and credit markets sealed tight, mass defaults are anticipated. An October study by the Association for Neighborhood and Housing Development estimates that as many as 54,000 city units are in buildings purchased with financing at risk of default.

“Obviously, the response to the foreclosure crisis is going to remain critical and important,” said Brad Lander, executive director of the Pratt Center for Community Development. “We’ve got all those predatory equity things that are going to be financially failing, so in all of those cases, [the city will need to be] trying to figure out the right mix of policy and finance.”

To help alleviate default pressures, along with a slew of other constraints faced by the affordable-housing industry, developers and advocates are looking to Washington, which in some cases will mean looking once again to Mr. Donovan.

The Bloomberg administration, often led by Mr. Donovan, has advocated for a number of federal legislative changes that would put help below-market-rate housing production and preservation in New York, including changes to the Federal Section 8 program and an expansion of the use of tax-free bonds. Whether those advance under an Obama administration has yet to be seen, although Mr. Donovan would clearly have a role in reviewing some of the desired legislation.

Affordable developers and advocates also are pushing for changes to the Federal Low Income Housing Tax Credit to extend its reach.

The economy has also humbled other goals outside of the mayor’s affordable-housing plan. Council Speaker Christine Quinn last year announced an initiative to create middle-income housing on a large scale. But the task force scaled back its ambitions amid the economic collapse, multiple committee members said, and some discussion has been devoted to trading financial incentives for affordability provisions in financially distressed properties and partially built apartment buildings.

Deputy Mayor Robert Lieber declined to comment on housing policy going forward, other than to reaffirm, through a spokesman, the Bloomberg administration’s commitment to its housing plan.

“With the slowdown in the economy, we’ve stretched out the time frame, but we are as committed to achieving the full plan today as ever,” said Andrew Brent, the spokesman. “We’ll do it through prudent fiscal policy and the creative use of private-market financing. And when the market improves, we plan to be well positioned to take advantage of it.”

ebrown@observer.com

A Sit-Down With Shaun Donovan, Obama’s HUD Pick

Tom Acitelli — Mon, 15 Dec 2008 04:08:36 -0400

The Observer sat down with Shaun Donovan, President-elect Obama's nominee to be secretary of Housing and Urban Development, in August 2007 to discuss Mr. Donovan's affordable-housing goals as the city's commissioner of Housing Preservation and Development. The interview also touched on tax incentives for developers and on the Bloomberg administration's 25-year growth plan.

The 42-year-old Mr. Donovan, who looks in person a lot younger than that, would enter HUD's top spot with an unusual qualification: He's, well, qualified and not merely politically connected. As my colleague Eliot Brown pointed out on Saturday morning, shortly after the president-elect announced the nomination:

The HUD secretary position has long gone to household political names, and alums of the position include former Representative Jack Kemp, who was Bob Dole’s running mate for president in 1996: Henry Cisneros, the former mayor of San Antonio; Andrew Cuomo, the now-attorney general of New York who served at the end of the Clinton era; and Senator Mel Martinez, who was a fundraiser for George W. Bush and ran unsuccessfully for lieutenant governor of Florida.