De Blasio restores $466M to housing capital budget
Decision comes after revelation that cuts saved almost no money
The de Blasio administration has backtracked on its plans to cut $1 billion from the city’s affordable housing budget.
Mayor Bill de Blasio announced Thursday that $466 million would be restored to the Department of Housing Preservation and Development’s fiscal 2021 capital budget to “address urgent affordable housing needs.”
In April, the mayor proposed cutting $583 million from fiscal 2020 and $457 million in 2021, as part of a broader attempt to address the city’s ballooning deficit. The move left housing groups as well as current and former city officials aghast, as they noted that capital funding leverages enormous private investment and that the cuts would do little to address the city’s $9 billion deficit — yet would slash affordable housing creation.
This week, a report released by the New York Housing Conference found that the cuts would only save the city $30 million this fiscal year and $16.8 million the next — a pittance in an $88 billion budget.
Calling the proposed cuts “unnecessary and unwise,” the report noted that the city’s capital budget is funded through bonds, which are paid back through debt service payments over the course of 30 years. That is why the cuts barely made a dent in the city’s deficit.
The Housing Conference has projected that the lost funding would result in 21,000 fewer affordable units over the next two years.
In a statement Thursday, the organization said the de Blasio administration’s reversal on fiscal year 2021 cuts would lead to the production of 11,000 affordable units.
“Investment in housing is critical to achieve fair housing goals,” Rachel Fee, executive director of the group, said in a statement. “While we applaud the move, we will continue to advocate for the full restoration of last year’s cuts to affordable housing.”
Affordable housing developer Daniel Moritz, principal of the Arker Companies, said this funding was critical to its 11-building housing complex planned in Far Rockaway.
“This is the lifeblood of our business,” he said. “It is critical in this day and age that we don’t pause the production.”
Earlier this week, his firm filed plans for the first of the complex’s buildings, a 194-unit project at 5123 Beach Channel Drive. Moritz said the mayor’s announcement gives his company hope that it can break ground on the project in 2021.
In Thursday’s announcement, the administration noted that de Blasio’s goal to create or preserve 300,000 affordable homes by 2026 remains on track. At the time of the announced HPD cuts, the administration also said those goals remained intact — because the funding was merely being moved to a future budget. But de Blasio must leave office at the end of next year.