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The Real Deal New York

Government news: Cuomo proposes $100M for affordable housing, federal lending rules tighten and more

February 01, 2014
By Sasha Von Oldershausen

Gov. Andrew Cuomo

Gov. Andrew Cuomo

Cuomo eyes $100M for housing

“Affordable housing is a crisis. Homelessness is growing,” Gov. Andrew Cuomo said in his State of the State address. Cuomo announced that he would put an additional $100 million into affordable housing. The investment — culled from federal Hurricane Sandy recovery funds — would go toward building and preserving 3,000 affordable housing units in multi-family developments. This is in addition to the $1 billion House NY initiative he introduced last year to create and preserve 14,300 affordable housing units. The new investment will follow the model used by House NY, which provides funding to organizations involved in low-cost housing development. The governor said in a statement the new construction should also help create more than 3,500 construction jobs.

NYU mulls next move on expansion

New York University appeared ready to go ahead with at least part of its planned expansion in Greenwich Village, despite a ruling that opponents interpreted as halting the construction. Manhattan State Supreme Court Judge Donna Mills ruled that NYU would either have to scale back the $6 million, 1.9 million-square-foot project, or seek state approval to proceed, because it calls for using three parcels of city parkland. The decision came in a lawsuit that pegged neighborhood residents against the university, which has earned the reputation as the biggest developer in downtown Manhattan. The university called the ruling “very positive,” because the judge did not vacate the City Council’s land-use approval. The school thinks it will still be able to move forward with its plans to build a 1 million square-foot building on the site of its current gym because it owns the property. It said it will review the decision to decide the impact of the ruling and determine its next legal steps. Neighborhood groups threatened to go back to court, should the school continue any part of its plan. NYU has previously been forced to reduce the size of the “Zipper Building” by 20 percent.

Fed lending rules tighten standards

New federal lending rules designed to lower the risk of default kicked in on Jan. 11. These “qualified mortgage” requirements are part of the Dodd-Frank Act, the federal banking regulation reform enacted two years ago in response to the financial crisis. The rules require lenders to document a borrower’s ability to repay a loan by scrutinizing income and debt. Lenders must also confirm a debt-to-income ratio of no more than 43 percent, The New York Times reported. Some in the industry are concerned that the rules will make it more difficult for low-income borrowers to qualify for mortgages, in addition to increasing the cost of jumbo loans (see full story here).

Bitcoin sparks legal controversy

The state Department of Financial Services plans to examine the legality of Bitcoin, the virtual currency designed to keep monetary transactions apart from government control by way of a peer-to-peer payment system. Since its launch in 2009, Bitcoin gained popularity with a number of small businesses, and more recently found a home at Bond New York. But ambiguity over how to categorize the cryptocurrency — whether it should be considered a capital asset or a commodity — has generated questions over whether it merits the formation of new rules. The IRS also is also looking into the matter, Forbes reported.