NYCHA Chief Sees Sec­tion 8 P3s as a Life­line

The Bond Buyer - - Regions - BY PAUL BUR­TON

Pub­lic-pri­vate part­ner­ships un­der the fed­eral gov­ern­ment’s Sec­tion 8 Ren­tal As­sis­tance Demon­stra­tion pro­gram may pro­vide the em­bat­tled New York City Hous­ing Author­ity with some fi­nan­cial breath­ing room, its in­terim chair­man said.

“We’re go­ing to RAD be­cause that’s where the money is,” Stan­ley Brezenoff told mem­bers of the City Coun­cil’s hous­ing com­mit­tee Tues­day.

“The more RAD we can do, the bet­ter,” said Brezenoff, who was named in­terim chair of the author­ity by Mayor Bill de Bla­sio in April.

“It is clear that pub­lic hous­ing author­i­ties must change the way we do busi­ness to sur­vive and thrive,” he said. “We must be re­al­is­tic and as­sume the decades-long trend of fed­eral dis­in­vest­ment will con­tinue.”

NYCHA serves 400,000 res­i­dents, or 5% of the city’s pop­u­la­tion, in 175,000 apart­ments.

Crises have en­gulfed it of late, in­clud­ing lack of heat in many units through­out the win­ter, mold and ro­dent in­fes­ta­tion, me­dia re­ports of staff sex or­gies on agency over­time and the forced res­ig­na­tion of Brezenoff’s pre­de­ces­sor, Shola Ola­toye, af­ter a city Depart­ment of In­ves­ti­ga­tions probe ac­cused Ola­toye of ly­ing to fed­eral reg­u­la­tors about lead­paint sta­tis­tics.

RAD, which Brezenoff called a “ground­break­ing” pro­gram, en­ables pub­lic hous­ing author­i­ties na­tion­wide to con­vert a pub­lic hous­ing prop­erty’s fed­eral Depart­ment of Hous­ing and Ur­ban De­vel­op­ment fund­ing to a project-based voucher or project-based ren­tal as­sis­tance.

“That is done by cre­at­ing pub­lic-pri­vate part­ner­ships, which can ac­cess ad­di­tional fund­ing for repairs by lev­er­ag­ing the Sec­tion 8 pro­gram,” he said.

NYCHA’s first such ven­ture was the 1,400-unit Ocean Bay Apart­ments in Far Rock­away, Queens, a $560 mil­lion un­der­tak­ing that in­volved fed­eral, state, city and pri­vate fund­ing.

Brezenoff called it the largest sin­gle-site RAD trans­ac­tion in the coun­try.

“One of RAD’s most no­table ben­e­fits is that it en­ables us to ad­dress all of the de­vel­op­ment’s ma­jor re­pair needs with­out spend­ing any of NYCHA’s cap­i­tal fund­ing.”

On Tues­day, the author­ity raised its es­ti­mate of apart­ments with pos­si­ble lead pain to 140,000.

NYCHA has a cap­i­tal-needs back­log of $32 bil­lion and a short­fall of $24 bil­lion. Fitch Rat­ings ranks NYCHA main­te­nance, along with mass tran­sit fund­ing, as “no­table spend­ing pres­sures” on the city.

The watch­dog Cit­i­zens Bud­get Com­mis­sion called on NYCHA to tap un­der­used as­sets, in­clud­ing air rights and po­ten­tial in­fill de­vel­op­ment, and im­prove its pro­cure­ment and build­ing-main­te­nance prac­tices.

NYCHA is also un­der fed­eral mon­i­tor­ing, hav­ing agreed to a con­sent de­gree in June. Fed­eral Judge Wil­liam Pauley III must still sign off on the mon­i­tor.

Brezenoff, who signed off on the con­sent de­cree shortly af­ter ar­riv­ing at NYCHA on June 1, fears that fed­eral mon­i­tor­ing will evolve into dra­co­nian re­ceiver­ship.

“What I do not want to see is a re­dun­dant level of man­age­ment at great cost that is not value ad­di­tive,” Brezenoff told coun­cil mem­bers.

At a Po­lice Ath­letic League lun­cheon speech Mon­day, Ge­of­frey Ber­man, the U.S. At­tor­ney for the South­ern District of New York in Man­hat­tan, ripped into NYCHA’s lead­er­ship.

“The real dis­as­ter is the man­age­ment at NYCHA and its cul­ture of de­cep­tion,” Ber­man said. “Mr. Brezenoff should be get­ting on board with the mon­i­tor­ship he signed off on.”

Coun­cil mem­bers grilled Brezenoff for sev­eral hours about ac­cel­er­at­ing cap­i­tal needs, fears that pri­va­ti­za­tion of NYCHA units could lead to gen­tri­fi­ca­tion and whether bick­er­ing over the mon­i­tor­ing level could hin­der the agency.

“Your con­cern with this mon­i­tor as hav­ing con­trol of day-to-day op­er­a­tions ... I just can’t un­der­stand the dam­age when the dam­age is cur­rently be­ing done by this author­ity, day to day” said coun­cil mem­ber Mark Gjonaj. “This author­ity is where all the dam­age is be­ing done, and that in­cludes the de­cep­tion and the lies and ev­ery­thing else.”

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