03.13.17

SCHUMER, GILLIBRAND, SERRANO, VELAZQUEZ HAMMER SUDDEN $56 MILLION TRUMP ADMINISTRATION’S HUD CUT TO NYCHA AS ILL-ADVISED AND UNJUSTIFIED” – AND PUSH FOR A REVERSAL

NYCHA Provides Housing, Vouchers & Other Assistance to 400K New Yorkers; Unexpected and Unjustified Cuts Hit Agency Operating on Tight Margins, Due to Years of Federal Retrenchment; Cuts Will Impact Quality, Repairs and Services for Countless Working Families and Seniors 

Lawmakers Demand Answers To Unacceptable Funding; Point to HUD Secretary Carson’s Hearings Pledge to “Advocate for HUD Budget” & Urge Him To Review and Reverse Cuts

U.S. Senator Charles E. Schumer, U.S. Senator Kirsten Gillibrand, Rep. Jose Serrano, and Rep. Nydia Velazquez today voiced their frustration with and opposition to the recently-announced federal HUD funding cuts that hit the New York City Housing Authority (NYCHA), the largest public housing authority in North America. Specifically, $48 million has been cut from NYCHA, and nearly $8 million from NYCHA’s Section 8 program under a change in the proration rate of reimbursement. The lawmakers blasted the cuts as “sudden, ill-advised and unjustified” and called on the new HUD Secretary Ben Carson to promptly review and reverse the proration rate adjustment and undo the cuts, which were made before he assumed control of the agency. And because, during hearings, he pledged to “advocate for the HUD budget.”

“HUD Secretary Ben Carson needs to promptly review and rescind these sudden and unjustified cuts to NYCHA’s budget. They are unjustified, not based on the reality of challenges NYCHA faces and will directly and negatively impact the organization’s ability to provide quality housing for countless working families and seniors,” said U.S. Senator Charles Schumer. “Access to affordable housing options, like NYCHA, is essential for the health of our families and the economic strength of our communities. With hundreds of thousands of housing-needy people in New York City alone, we need to do all we can to provide families and children with safe and affordable housing options and that’s why I will fight tooth and nail against any cuts to NYCHA.”

“These cuts proposed by HUD will hurt families in communities across the city,” said Senator Gillibrand. “Over 400,000 New Yorkers depend on NYCHA, and these cuts will disproportionately hurt families most in need and cause further delays in critical repairs and inspections. I will continue to vigorously oppose these cuts and will keep fighting to protect resources to help ensure New York families have safe places to call home.”

“As we all know, access to affordable housing is one of New York City’s most pressing problems, particularly in areas like the Bronx. That is why these unexplained cuts to NYCHA are particularly devastating, and should be rescinded.  NYCHA plays a key role in guaranteeing that hundreds of thousands of low-income individuals -- including homeless people, seniors, and other vulnerable populations – can have a roof over their heads and a place to call home. These attacks will harm many New York families - and damage an already financially stressed public housing agency. As a delegation, we are fighting for what’s fair and necessary in New York,” said Congressman Serrano.

Rep. Nydia M Velazquez (D-NY) said, "These cuts would inflict significant hardship on working families, seniors and other NYCHA residents. We must be united in opposing these steps backwards and pushing the Administration to budget sufficient resources for NYCHA and all public housing facilities."

Schumer, Gillbrand, Serrano and Velazquez noted that during his hearing, Secretary Carson made affirmations about advocating for HUD in the budget. Specifically, Secretary Carson said: “Not only do I want to advocate for the HUD budget, but, you know, in the process of doing a listening tour and in talking to the people who were there already I want to put together a world-class plan on housing in this country and then I want to come to you with that world-class plan and I want to convince you all that this is what we need to do.” HUD Secretary Carson also said: “I think the rental assistance program is essential and what I have said, if -- if you been reading my writings, is that when it comes to entitlement programs, it is cruel and unusual punishment to withdraw those programs before you provide an alternative…” The lawmakers today said that they have not received sufficient information and details to explain why the announced cuts were necessary and inconsistent with HUD Secretary Carson’s statements.

According to NYCHA, there are 177,657 apartments in 328 NYCHA developments throughout New York City in 2,547 residential buildings. The developments serve 175,817 families and 403,275 authorized residents. A total of 599,493 New Yorkers are served by NYCHA’s Public Housing and Section 8 Programs. Of the population NYCHA serves, 27 percent of residents are under the age of 18; over 19 percent are 62 or older. The average household income is $23,672 and their average rent is $483/month.

The HUD cuts to NYCHA’s budget includes a sharp decrease, from 90% to 85%, in the prorated amount of operating funding that NYCHA receives. The unexpected and dramatic 5% cut amounts to an approximate $48.7 million loss in revenue. The change in the Section 8 Administrative fee from 84% to 77% proration has resulted in $7.6 million in lost revenue. These total cuts of $56.3 million are a significant decrease in the prorated amount of funding that the agency received throughout 2016. 

In their letter to HUD, the lawmakers said that this reduction could hinder NYCHA's ability to be prompt in responding to maintenance requests, as well as employing staffers to care for the hundreds of NYCHA properties. Additionally, NYCHA faces a significant hurdle with regard to its current $17 billion capital backlog that the lawmakers say will only be exacerbated by additional budget decreases.

A copy of the lawmakers’ letter is below:

Dear Secretary Carson,

We write with deep concern in response to recent news announcing a decrease in the operating expense reimbursement rate the Department of Housing & Urban Development (HUD) has imposed on New York City's Housing Authority (NYCHA). Recently, an unexpected and significant cut was made to reimbursements for the months of February and March 2017. Given the tight budget on which NYCHA operates, and the significant challenges in meeting the monthly need to provide quality housing to its residents, it is evident that these cuts will have severe effects for New York City NYCHA residents. It is our belief that these cuts are ill-founded, unnecessary and harmful to hundreds of thousands of NYCHA residents. We are troubled both by their occurrence and the lack of warning or data-based justification for their implementation, and we strongly urge that they be reconsidered and rescinded.

NYCHA is dedicated to providing direct housing, vouchers and other forms of housing assistance to families in need. Additionally, NYCHA works to provide supportive services that equip residents with tools to become financially empowered. So far, our offices have yet to receive sufficient clarity on the basis on which these revisions were made and therefore, we request an immediate review of these cuts and a detailed explanation of how these rates were calculated.

The decision which was announced to NYCHA in February showed a sharp decrease, from 90% to 85%, in the prorated amount of operating funding that NYCHA receives. The unexpected and dramatic 5% cut amounts to an approximate $48.7 million loss in revenue. The change in the Section 8 Administrative fee from 84% to 77% proration has resulted in $7.6 million in lost revenue. These total cuts of $56.3 million are a significant decrease in the prorated amount of funding that the agency received throughout 2016. Unfortunately, this substantial loss will have severe and unfavorable impacts for the largest public housing authority in the nation.

NYCHA currently supports approximately 400,000 New Yorkers, all of whom will be impacted by these ill-advised cuts. This reduction will hinder NYCHA's ability to be prompt in responding to maintenance requests, as well as employing staffers to care for the 328 properties spread throughout the New York City metro area. Additionally, NYCHA faces a significant hurdle with regard to its current $17 billion capital backlog that will only be exacerbated by additional budget decreases. In light of these challenges, where we believe HUD should be doing more, not less, it is critical that HUD be transparent and provide the data that, from HUD's perspective, informs these changes; it is of utmost importance to know what has led to such a sharp decrease in the proration amount, one that we believe should be reversed.

During your confirmation hearing before the Senate Banking Committee you pledged to “advocate for the HUD budget” and suggested that it would be “cruel and unusual punishment” to cut the housing budget dramatically. These most recent announcements regarding cuts to NYCHA’s budget are certainly inconsistent with your statements before the Banking committee, and therefore, we ask that HUD review the changes to rates and provide a detailed, data-based explanation for how this decision was made. This information should help clarify the process used by HUD and help set expectations moving forward. As in the past, we look forward to working with HUD in continued efforts to support our public housing programs and maintain the critical services and resources they provide.

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