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The Housing Our Neighbors with Dignity Act

NYC, Real Estate Developments

The New York State Legislature is advancing legislation to enact the Housing Our Neighbors with Dignity Act (“HONDA”). The purpose of this legislation is to allow New York State to finance the purchase of and convert distressed hotels and vacant commercial office space into permanent affordable housing. The act will combat housing issues which have been heightened by the COVID-19 pandemic. The act is sponsored by Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie. [1] 

One of the supporters of HONDA, Assembly Housing Committee Chair Steven Cymbrowitz, has been working with residents in the Brighton Beach and Sheepshead Bay neighborhoods to challenge the New York City Department of Homeless Services (“DHS”) and CORE, a nonprofit partner of DHS, in charge of several transient housing shelters throughout New York City. Residents challenged City Hall for trying to quickly pick a location without considering all the factors of the proposed location, including concerns from those who are homeless, homeowners, parents, and businesses. Residents and City Council candidates are pushing for the city to, instead of erecting transient shelters all over, create more affordable housing and supportive housing so that New Yorkers will not have to enter the shelter system or sleep on the street. [2] Findings have shown that increasing public housing preferences and long-term rent subsidies leads to a much higher rate of placements of families into long-term stable placements. Having a stable home decreases the number of families who end up returning to shelters. [3] 

HONDA might be the legislative solution these residents have been looking for. Elected officials hope that, by converting distressed hotels and vacant commercial spaces into permanent affordable housing in conjunction with addressing mental health issues, unemployment, and other factors, they will be able to eventually end homelessness in New York. The new housing will be available to both homeless families and individuals, which includes low-income households and people who were previously homeless. Units located in localities which have adopted or opted in to the rent stabilization law must be rent stabilized. Additionally, at least 50% of the units will be set aside for those who have experienced homelessness immediately prior to applying for the converted units. The other 50% will have an 80% area median income (“AMI”) cap for tenants. [4] HONDA will also ensure prevailing wages (parallel to current New York City requirements) for building service employees in projects throughout the city. However, supportive housing projects and small converted properties will be exempt from the prevailing wage requirement. [5] 

“Cluster sites” which used to be the go-to solution are now being closed in favor of borough-based shelters, [6] and soon, if the legislation that will enact HONDA gets passed, permanent affordable housing. Perhaps permanent housing will abate homeowners’ fears of their property value dropping as studies had suggested was the case for properties located next to cluster sites and shelters. One study released by New York City’s Independent Budget Office indicated that Manhattan houses located near shelters lost up to 17 percent of their value. “Homes within 1,000 feet of multiple shelters took an average hit of 17.4[%].” [7] City Hall claims the study’s methodology was flawed because of its small study pool and failure to account for other factors that influence property values. Moreover, the study was commissioned by Manhattan Borough President Gale Brewer, who claimed that the negative impact on property values was only due to transitional shelters. 

[1] “Senate and Assembly to Pass The Housing Our Neighbors with Dignity Act”, New York State Legislature, 9 June 2021, https://assembly.state.ny.us/Press/?sec=story&story=97487, acc. 12 July 2021.

[2] “Exclusive: Homeless Shelter Will NOT Be Located at 100 Neptune”, Shorefront News, 17 June 2021, https://shorefrontnews.com/2021/06/17/exclusive-homeless-shelter-will-not-be-located-at-100-neptune/, acc. 12 July 2021.

[3] Giselle Routhier, “Family Homelessness in NYC: City and State Must Meet Unprecedented Scale of Crisis with Proven Solutions”, coalition for the homeless, https://www.coalitionforthehomeless.org/family-homelessness-in-nyc/, acc. 12 July 2021.

[4] The 80% AMI cap will be in place as long as the average income for all tenants in these projects does not exceed 50% AMI. “Senate and Assembly to Pass The Housing Our Neighbors with Dignity Act”, New York State Legislature, 9 June 2021, https://assembly.state.ny.us/Press/?sec=story&story=97487, acc. 12 July 2021.

[5] Ibid.

[6] Valeria Ricciulli, “Housing, rental vouchers, outreach: Can NYC fix its homeless crisis?”, Curbed, 25 February 2020, https://ny.curbed.com/2020/2/25/21146143/homelessness-new-york-city-how-to-fix, acc. 12 July 2021.

[7] This report is based on New York City Department of Finance data from all sales of Manhattan residential condos and one- to three-family stand alone homes between 2010 and 2018. Matthew McDermott, “Homeless shelters drop Manhattan property values by up to 17%: study”, NY Post, 25 Sep. 2019, https://nypost.com/2019/09/25/homeless-shelters-drop-manhattan-property-values-by-up-to-17-study/#:~:text=Manhattan%20houses%20located%20near%20shelters,roughly%2058%2C000%20homeless%20New%20Yorkers, acc. 12 July 2021; “Does Proximity to a Homeless Shelter Affect Residential Property Values in Manhattan?”, Independent Budget Office, Sep. 2019,  https://ibo.nyc.ny.us/iboreports/close-to-home-does-proximity-to-a-homeless-shelter-affect-residential-property-values-in-manhattan-2019.html, acc. 12 July 2021.

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