Mayor Bill de Blasio’ signature affordable housing plan, already troubled by a string of setbacks at the start of year as rezonings encountered roadblocks, is set to take another big blow.
The mayor has proposed cutting $583 million from the plan’s budget for the fiscal year which ends June 30 and another $456 million next year, Politico reported. The de Blasio administration says it will compensate by adding just over $1 billion to the budgets for fiscal years 2022 through 2024.
“The agency is taking a hard look at the projects in our pipeline and working creatively with partners to find additional sources of financing to move our projects forward,” a spokesperson for the city’s housing department told Politico.
“We understand that affordable housing will be more important than ever on the other side of this crisis, which is why we are advocating for more federal resources to support our push forward.”
But the economic shutdown in response to the coronavirus pandemic is costing the city billions of dollars in tax revenue.
Record-low interest rates have also reduced the value of federal housing tax credits, making it more difficult to finance affordable housing development.
“All of our government partners have certainly been preparing us for a slowdown in the production pipeline just given the massive amount of resources the city and state have had to devote to crisis response,” said Riseboro Community Partnership CEO Scott Short.
As the City Council prepares to hold remote budget hearings in the coming weeks, de Blasio’s proposed cuts are likely to face some resistance. Council Member Brad Lander has warned that the crisis could lead to “austerity thinking,” and proposes that the city take on more long-term debt instead of cutting the capital program for housing.
“One danger in a crisis like this is in the name of budget balancing, which you have to do, you eat your seed corn and you make decisions that sacrifice the city’s long-term future,” Lander said. “I really think leaning into and investing more in affordable housing is part of how we promote the recovery.” [Politico] — Kevin Sun