Unable to formulate an equally successful solution to the affordable-housing problem, legislator after legislator, beginning in 1985, have proposed bill after bill attempting to eliminate an owner’s ability to buy out of the Mitchell-Lama program. It is incomprehensible that the very catalyst that created the incentive for the private sector to get involved, and made the program the success it was, is so flippantly used as vote-getting fodder by those either in office or running for a political position. Do they not believe in sticking to a contract? Clearly, New York has a tremendous need for more affordable housing, but changing this critical element of the program would be a breach of faith resulting in a loss of trust in government and would discourage private-sector participation in future affordable-housing projects, which are so desperately needed.
As owners buy out of the program, New York receives significant real estate tax revenue and, given that many of these properties are sold, transfer taxes and transactional fees. This money could be set aside to bolster new programs aimed at creating affordable housing.
However, the only real solution to the current critical shortage of affordable housing is for government to reestablish its credibility with the private sector and use every tool and incentive at its disposal to, once again, encourage private developers to build or rehabilitate affordable rental, cooperative or condominium units. (Governor Paterson last week signed legislation updating Mitchell-Lama, but it dealt with administrative issues primarily.)
Repeal or extension of the 35-year voluntary dissolution provisions of the Mitchell-Lama program would seem to be a giant step in exactly the wrong direction. After all, we don’t want Bud Selig telling us the Yankees are not the 2009 World Champions!
rknakal@masseyknakal.com
Robert Knakal is the chairman and founding partner of Massey Knakal Realty Services, and has brokered the sale of more than 1,000 properties in his career.
