A 3rd Term Bloomberg

Ron Lauder and the other billionaires that want Mike Bloomberg to run for a third term constantly harp that since he's rich, the Mayor's continued presence will help us through tough times. The logic is shaky at best and really the only way that benefits us is the trickle-down effect around his townhouse on the Upper East Side. As for things that matter to New Yorkers such as affordable housing, it looks like he is either worsening the problem (by kowtowing to developers with zoning laws that push lower income residents away from the city) or merely ineffectual, as this bit of news confirms.

From The NY Daily News:

Mayor Bloomberg's campaign to build 165,000 units of desperately needed affordable housing appears to be running into the same economic maelstrom that brought down Wall Street.

A $240 million fund that was a key element of the mayor's housing plan relies on some of the country's most troubled banks and securities firms, records show.

The New York City Acquisition Fund's partners include Washington Mutual, Wachovia and Fannie Mae, strongly suggesting it may become a casualty of the still-evolving credit meltdown.

That would be bad news because the city has a shortage of 100,000 to 300,000 units of affordable housing, the Pratt Center for Community Development says.

And with numbers like that, it is also hard to determine what "affordable" means. According to the Mayor, those who qualify are singles that makes under $32,300 and $46,000 for couples. As the Daily News article mentions, many of us in NYC spend more than half our income in housing. With caps like that, even if the housing gets built, many people are still going to struggle.

Of course, it has to be built first and frankly there is no way to do it now with the markets as nuts as they are now. Bloomberg's supporters say he can walk us through this because he's a billionaire. Yet, even a billionaire is no match for the economic crisis unless....he wants to use his wealth to build some of those homes. And as we all know, that'll be a cold day in hell.

The Predatory Landlords Of New York

There is a certain stigma about New York landlords and it isn't too good. Things often are not fixed in a decent amount of time or not at all. Pests can be a problem too. The worst is the way they demand to raise the rent every year on top of their sluggishness to keep the units up to par. None of this however, compares to the new breed of landlord in the five boroughs. That vulture is called a private equity firm and there are a few of them now that exist to destroy what remains of New York's affordable housing. As we've seen so far, they'll go to extraordinary lengths to kick their tenants with "affordable" rents.

From The NY Times:

Private investment firms have been amassing what may seem like unusual stakes in New York real estate: they have bought hundreds of apartment buildings with thousands of rent-regulated units across the city that produce decidedly meager returns.

As regulatory filings and promotional materials show, the companies expect to generate higher returns quickly by increasing rents after existing tenants vacate their units. Their success depends upon far higher vacancy rates than are typical in rent-regulated apartments in New York.

Some residents and tenant advocates say that they began seeing what they consider a pattern of harassment of low-income tenants this year and suspect that it is a result of the new owners’ business models. Tenants have been sued repeatedly for unpaid rent that has already been received by the landlords; they have been sent false notices of rent bills, lease terminations and nonrenewals; and they have been accused of illegal sublets.

The companies dispute the charges of harassment and say they are protecting their rights.

Nevertheless, tenants must answer the notices in court, but many have responded by moving out, court documents indicate. When they vacate the apartments, the owners can increase the rents substantially.

Basically the deal is move into the building, intimidate the residents that don't pay you with their souls (or half their salary) and drive them out by taking them to court over and over again. It is a sick, sad and disgusting process that no one has done much of anything to stop it. It sounds a lot like those corporate crooks in the banking industry that have screwed over so many homeowners. These heartless forms of Odysseus in search of the highest profit margin are what they are. The problem is that our government does not rein them in, that is what needs to be done here. Getting the private equity and real estate money out of the city's election process would be a good start.

Affordable Housing Bill Tainted By NY Legislature

A smart piece of legislation put together by a coalition of groups to enable construction of affordable housing was cut to pieces by the state legislature this week. Instead of a bill that would have provided for the lower and middle classes by revamping certain tax breaks, a few special developers (like Bruce Ratner) got gigantic tax breaks to pad their controversial projects. The culprit who amended the legislation is Brooklyn's own Vito Lopez, yet all but two legislators signed the bill.

From The New York Times:

Mr. Lopez, who did not consult many of the advocates and builders who had worked on the city’s proposal, defended his legislation, saying it aimed at housing for poor and working-class New Yorkers. Middle-class families were just “not as high a priority,” he said.

But many advocates, city officials and even some Senate Republicans are saying that Steven Spinola, president of the Real Estate Board of New York, betrayed the city’s effort. By all accounts, Mr. Spinola, the leading industry lobbyist, played a major role in negotiating the compromises and the tax deals for Atlantic Yards and other developments that led to Senate approval.

“This was a backroom deal,” said Liz Krueger, one of only two state senators who voted against the bill.

Sounds a lot like the same old crap from Albany. Unless the bill is miraculously changed back to its original intent, this one definitely needs to be vetoed by the Governor. It goes against the central theme of what he ran on, cleaning up the corruption that is so rampant in our state. Three hundred million dollars in tax breaks for companies like the Forest City Ratner group is completely unacceptable.