Creating Middle Class Housing

Guest Commentary

Volume CIV, No. 5May, 2004

City Councilmember David Yassky

Will a middle class survive in New York City? The answer depends on many factors, but the availability of quality housing is perhaps the most important. At this moment, the city government has a unique opportunity to dramatically expand the supply of affordable housing — but it will have to act soon.

The hard economic reality is that New York developers simply do not build middle-income housing without government intervention. In earlier decades, this intervention took the form of government subsidies, most notably the “Mitchell-Lama” program. Mitchell-Lama funded construction of 150,000 new apartments in the 1960’s and 1970’s. In return for the subsidies, landlords agreed to keep rents at levels affordable to carpenters, teachers and other middle-income tenants.

The Mitchell-Lama program did its job very well. Unfortunately, affordability requirements have already lapsed for some 7,100 apartments in the program, and most of the remaining apartments are scheduled to revert to market prices over the next several years. These units must be protected — but at the same time we must seek new affordable development.

Some housing advocates have called for a new Mitchell-Lama program. But in the current budget climate, it is simply not realistic to expect billions of dollars for subsidized construction. Instead, we need to find a more innovative way to encourage private investors to build affordable housing.

Fortunately, the city has something to offer private developers that could be even more attractive than monetary subsidies: the right to build in neighborhoods where residential apartments are currently prohibited.

Under the city’s zoning code, certain areas are reserved for manufacturing use. In many of these neighborhoods, however, jobs have left for low-wage countries, and factories and warehouses sit vacant. According the City Planning Department, rezoning unused or underused manufacturing-zoned land would produce more than 60,000 new apartments throughout the city.

In my district, the city is undertaking a massive rezoning of the Greenpoint/Williamsburg waterfront to convert mostly abandoned manufacturing lots to residential property. The demand for housing in the area is intense. These new condos and apartments with a spectacular view of the Manhattan skyline could almost certainly fetch luxury prices. But rich people aren’t the only ones who are desperate for a nice place to live. Indeed, the working-class families that already live in northern Brooklyn — some of whom have for generations — are struggling to stay in the enviable community that they helped create. These are the New Yorkers who need affordable housing.

We can give it to them.

The city should offer property owners in neighborhoods like Greenpoint and Williamsburg a simple deal: You can build apartments, as long as a specified portion of these new apartments are reserved for low-income or middle-income families.

Developers would take this deal in a heartbeat. Changing a neighborhood’s zoning from industrial to residential use increases the value of property in the neighborhood by as much as 500 percent. Property owners would gladly shoulder the responsibility of creating affordable housing in return for this windfall.

City officials had to close a $5 billion budget gap last year, and face a $2 billion gap for the coming year. An affordable housing bonus program would not cost taxpayers a dime. Rather, it would accomplish a valuable goal — more affordable housing — by creatively using the assets and tools available to the government. That type of creativity is exactly what the city government needs.

David Yassky represents the 33rd district in the New York City Council which includes many areas of Brooklyn. He is chair of the Waterfront Committee.