[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]
RESTORING PROSPERITY IN AMERICAN
COMMUNITIES: EXAMINING THE FAILURES
OF STATUS QUO HOUSING POLICY
=======================================================================
FIELD HEARING
before the
SUBCOMMITTEE ON HOUSING AND INSURANCE
of the
COMMITTEE ON FINANCIAL SERVICES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED EIGHTEENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 22, 2024
__________
Serial No. 118-77
Printed for the use of the Committee on Financial Services
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
www.govinfo.gov
_______
U.S. GOVERNMENT PUBLISHING OFFICE
56-347 PDF WASHINGTON : 2026
HOUSE COMMITTEE ON FINANCIAL SERVICES
PATRICK McHENRY, North Carolina, Chairman
FRENCH HILL, Arkansas, Vice MAXINE WATERS, California, Ranking
Chairman Member
FRANK D. LUCAS, Oklahoma SYLVIA R. GARCIA, Texas, Vice
PETE SESSIONS, Texas Ranking Member
BILL POSEY, Florida NYDIA M. VELAZQUEZ, New York
BLAINE LUETKEMEYER, Missouri BRAD SHERMAN, California
BILL HUIZENGA, Michigan GREGORY W. MEEKS, New York
ANN WAGNER, Missouri DAVID SCOTT, Georgia
ANDY BARR, Kentucky STEPHEN F. LYNCH, Massachusetts
ROGER WILLIAMS, Texas AL GREEN, Texas
TOM EMMER, Minnesota EMANUEL CLEAVER, Missouri
BARRY LOUDERMILK, Georgia JAMES A. HIMES, Connecticut
ALEXANDER X. MOONEY, West Virginia BILL FOSTER, Illinois
WARREN DAVIDSON, Ohio JOYCE BEATTY, Ohio
JOHN W. ROSE, Tennessee JUAN VARGAS, California
BRYAN STEIL, Wisconsin JOSH GOTTHEIMER, New Jersey
WILLIAM R. TIMMONS, IV, South VICENTE GONZALEZ, Texas
Carolina SEAN CASTEN, Illinois
RALPH NORMAN, South Carolina AYANNA PRESSLEY, Massachusetts
DANIEL MEUSER, Pennsylvania STEVEN HORSFORD, Nevada
SCOTT FITZGERALD, Wisconsin RASHIDA TLAIB, Michigan
ANDREW R. GARBARINO, New York RITCHIE TORRES, New York
YOUNG KIM, California NIKEMA WILLIAMS, Georgia
BYRON DONALDS, Florida WILEY NICKEL, North Carolina
MIKE FLOOD, Nebraska BRITTANY PETTERSEN, Colorado
MICHAEL LAWLER, New York
ZACHARY NUNN, Iowa
MONICA DE LA CRUZ, Texas
ERIN HOUCHIN, Indiana
ANDREW OGLES, Tennessee
Matthew Hoffmann, Staff Director
------
SUBCOMMITTEE ON HOUSING AND INSURANCE
WARREN DAVIDSON, Ohio, Chairman
MONICA DE LA CRUZ, Texas, Vice EMANUEL CLEAVER, Missouri, Ranking
Chairwoman Member
BILL POSEY, Florida NYDIA M. VELAZQUEZ, New York
BLAINE LUETKEMEYER, Missouri RASHIDA TLAIB, Michigan
RALPH NORMAN, South Carolina RITCHIE TORRES, New York
SCOTT FITZGERALD, Wisconsin AYANNA PRESSLEY, Massachusetts
ANDREW R. GARBARINO, New York SYLVIA R. GARCIA, Texas
MIKE FLOOD, Nebraska NIKEMA WILLIAMS, Georgia
MICHAEL LAWLER, New York STEVEN HORSFORD, Nevada
ERIN HOUCHIN, Indiana BRITTANY PETTERSEN, Colorado
C O N T E N T S
----------
Thursday, February 22, 2024
OPENING STATEMENTS
Page
Hon. Warren Davidson, Chairman of the Subcommittee on Housing and
Insurance, a U.S. Representative from Ohio..................... 1
Hon. Michael Lawler, Member of the Subcommittee on Housing and
Insurance, a U.S. Representative from New York................. 28
Hon. Mike Flood, Member of the Subcommittee on Housing and
Insurance, a U.S. Representative from Nebraska................. 29
WITNESSES
Mr. Ralph D. Amicucci, Amicucci Associates, PC, Attorneys at Law,
on Behalf of the Institute of Real Estate Management, New York
Chapter........................................................ 3
Prepared Statement........................................... 5
Hon. Teresa M. Kenny, Supervisor, Town of Orangetown, NY......... 8
Prepared Statement........................................... 11
Mr. John Ketcham, Fellow and Director of Cities, Manhattan
Institute...................................................... 13
Prepared Statement........................................... 15
Ms. Leah Goodridge, Managing Attorney for Housing Policy,
Mobilization for Justice....................................... 22
Prepared Statement........................................... 24
APPENDIX
RESPONSES TO QUESTIONS FOR THE RECORD
Written responses to questions for the record from Mr. Ralph D.
Amicucci
Representative Maxine Waters................................. 50
Written responses to questions for the record from Hon. Teresa M.
Kenny
Representative Maxine Waters................................. 51
Written responses to questions for the record from Mr. John
Ketcham
Representative Maxine Waters................................. 52
RESTORING PROSPERITY IN AMERICAN
COMMUNITIES: EXAMINING THE FAILURES
OF STATUS QUO HOUSING POLICY
----------
Thursday, February 22, 2024
U.S. House of Representatives,
Subcommittee on Housing and Insurance,
Committee on Financial Services,
Washington, DC.
The Committee met, pursuant to notice, at 10 a.m., at
Rockland County Legislature, 11 New Hempstead Road, New City,
New York, Hon. Warren Davidson presiding.
Present: Representative Davidson.
Also present: Representatives Flood and Lawler.
Chairman Davidson. The Committee on Housing and Insurance
will come to order. Without objection, the chair is authorized
to declare a recess of the committee at any time. This hearing
is entitled ``Restoring Prosperity in American Communities:
Examining the Failures of the Status Quo Housing Policy.''
Without objection, all members will have 5 legislative days
within which to submit extraneous material to the chair for
inclusion in the record.
I now recognize myself for 5 minutes to give an opening
statement.
OPENING STATEMENT OF HON. WARREN DAVIDSON, CHAIRMAN OF THE
SUBCOMMITTEE ON HOUSING AND INSURANCE, A U.S. REPRESENTATIVE
FROM OHIO
Today's hearing is about restoring prosperity in American
communities by examining the failures of status quo housing
policies. This is an important topic that we have correctly
devoted a lot of attention to in this Congress and, frankly, in
previous Congresses.
Thus far, over the last 12 months, the subcommittee has
held six hearings exploring various aspects of how everyday
Americans are having their lives impacted by bad government
decisions and failed Federal policies on housing. The result is
reduced prosperity, reduced customer choice, and reduced
optimism that things are going to get better anytime soon--
people are not believing that it is really transitory.
Making matters worse, as we will hear from testimony today,
is the alarming notion that the local input in the process does
not even matter or is not necessary. In fact, sometimes it is
treated as a barrier.
Instead of working collaboratively with local mayors,
supervisors, and other county officials to balance the needs of
residents in their own communities, all too often bureaucrats,
whether in State governments like Albany or in Washington, DC,
want to impose mandates on places like Orangetown, Nyack, New
York City, Cincinnati, Middletown, Lincoln, Nebraska.
Ironically, it is the local citizens who are forced to
implement their overreaching and excessively expensive
policies, and to add insult to injury, they are the ones who
end up footing the bill. By the way, these same bureaucrats say
that anyone who opposes these ideas is not just wrong, they are
mean-spirited and selfish people. Simply put, the bureaucrats
pushing these ideas do not really care about what local
residents think because they have an agenda and they are
seeking to push it, and it is almost like no matter what, they
are inclined to not listen.
Today, hopefully, we will give voice to local communities
and a more wide-ranging set of views.
In Congress, every member is dealing with some aspect of
affordable housing. Members of our committee are particularly
focused on legislation that provides solutions.
I especially want to thank my colleagues Mike Flood from
Nebraska and Mike Lawler, who many of you know locally. They
have been some of the most committed members on housing policy,
hosting roundtables in their districts and advancing
legislation to try to address the issues.
For our seventh hearing, we decided to travel to New York
to our colleague Mike Lawler's district, so that we can see
firsthand the impact that poorly designed and heavy-handed
Federal, State, and local housing mandates are having.
Folks in Rockland County find themselves in a situation
that has become all too common in areas around the country.
Housing has already been too expensive, and now inventory is
limited. Lawmakers' response is to force mandates, which sounds
good on paper, but ends up hurting affordability and
availability for residents most in need.
These impacts are real, and I look forward to addressing
them with our witnesses today.
Today I would like to welcome the testimony of Mr. Ralph
Amicucci. Mr. Amicucci, of Amicucci Associates, is here on
behalf of the Institute of Real Estate Management, the New York
Chapter.
The Honorable Teresa Kenny. She is the Supervisor of the
Town of Orangetown, New York.
Mr. John Ketcham. Mr. Ketcham is a Fellow and Director of
Cities at the Manhattan Institute.
Ms. Leah Goodridge. She is the Managing Attorney for
Housing Policy at Mobilization for Justice.
We thank you for taking the time to be here today, and
without objection your written statements will be made part of
the record.
Mr. Amicucci, you are now recognized for 5 minutes to give
your oral remarks.
STATEMENT OF RALPH D. AMICUCCI, AMICUCCI ASSOCIATES, PC,
ATTORNEYS AT LAW, ON BEHALF OF THE INSTITUTE OF REAL ESTATE
MANAGEMENT, NEW YORK CHAPTER
Mr. Amicucci. Chairman Davidson and members of the
committee, thank you for inviting me here to testify at this
important hearing.
My name is Ralph Amicucci, and I am the Managing Partner of
Amicucci Associates, PC, Attorneys at Law, concentrating in
real estate. Our firm concentrates its real estate practices in
areas of landlord/tenant matters, buy and sell transactions,
bank representation, commercial leasing, and representation
front of the New York State Division of Housing and Community
Renewal.
I am an active member of the Institute of Real Estate
Management, IREM, where I am a certified instructor, I hold the
certified property manager, CPM, designation, and I serve as
the Vice President of Education for the New York Chapter. I am
also an adjunct assistant professor of real estate accounting
at New York University's Schack Real Estate Institute and in
the Civil Engineering Department at NYU's Tandon School of
Engineering, as well as an adjunct professor in the Accounting
Department of Manhattan College in the Bronx, New York.
Today, in more and more communities, hard-working Americans
are unable to rent or buy homes due to increased housing costs.
These rising costs are driven by a lack of supply created by
barriers to development and burdensome laws currently in
existence that increasingly make it extremely challenging to
build housing at almost any price point, particularly a price
affordable to low-and middle-class families. The total share of
cost-burdened households--those paying more than 30 percent of
their income to housing--increased steadily from 28 percent in
1985 to 36.9 percent in 2021, while other households have been
priced out of communities altogether in their search for
affordable housing.
This is not sustainable, particularly in a period of high
inflation. It is critical that we start now to enact policies
that will incentivize new housing production.
As Congress examines approaches to address housing
affordability, I would implore the committee not to use failed
state-level housing policies as a prototype. Many states,
including New York, have enacted policies that have an adverse
effect on the creation of affordable housing units and current
conditions of existing housing.
I would like to specifically address the Housing Stability
and Tenant Protection Act, the HSTPA, which was passed in New
York in 2019, that negatively affects renters and discourages
affordable housing development. The HSTPA removed virtually all
incentives for owners to renovate rent-stabilized apartments
vacated by long-term tenants. This resulted in more than 30,000
units remaining vacant. The HSTPA capped the amount of
individual apartment improvements at $15,000 over 30 years,
which translates to about $83 a month of additional rent, when
the true cost to rehab the unit is between $100,000 to
$150,000. The HSTPA also removed vacancy de-control which
allowed owners to raise rents to market when a tenant vacated
an apartment. No other municipality has vacancy control. The
2019 law essentially states that if a renter leaves an
apartment, no matter what happens, the rent stays the same.
Even California, with the perception of being very punitive
against property rights, an owner can reset the rent when an
apartment becomes vacant.
Stabilized rents in New York City buildings are set each
year by the Rent Guidelines Board, which voted last June for a
3 percent rent increase for 1-year leases, and a 2.75 percent
increase for the first year of a 2-year lease and 3.20 percent
for the second year of a 2-year lease. However, fuel,
utilities, labor, maintenance, administrative costs, insurance,
and taxes in rent-stabilized multifamily buildings rose by 8.1
percent from April 2022 to March 2023.
Instead of looking at New York, I would recommend members
of the committee immediately act on the following measures that
my colleagues and I believe would have a positive impact on
housing affordability and help increase the Nation's housing
supply.
I am running out of time, so the four areas that I would
recommend would be the Choice in Affordable Housing Act, S. 32
and H.R. 4606; the Low-Income Housing Tax Credit, or LIHTC; and
the Affordable Housing Credit Improvement Act, H.R. 3238 and S.
1557; and then eliminate exclusionary zoning and harmful land
use policies; and then incentivize adaptive reuse of
underutilized commercial properties.
Chairman Davidson, Ranking Member Cleaver, and members of
the committee, thank you again for providing myself and IREM
with the opportunity to testify here today. I look forward to
answering your questions.
[Prepared statement of Mr. Amicucci follows:]
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Chairman Davidson. Thank you. I now recognize Ms. Kenny for
her opening statement.
STATEMENT OF THE HON. TERESA M. KENNY, SUPERVISOR, TOWN OF
ORANGETOWN, NY
Ms. Kenny. Good morning and thank you for inviting me here
today to offer some remarks on the housing crisis in New York,
something that is happening in communities throughout the
United States in one degree or another. Although I have no
particular expertise on the subject matter, my background and
experience give me a unique perspective and insight on the
topic.
I am a practicing lawyer for over 33 years, specializing in
real estate and municipal law. In 2019, I was elected town
supervisor for the Town of Orangetown, and I just started my
third term. Orangetown is the southernmost town in Rockland
County, located approximately 30 miles north of New York City,
and per the 2020 census has a population of just under 49,000
residents, with 18,724 housing units.
Over the last 2 years, under my leadership and with the
help of professional planners, the Town Board undertook the
task of updating the Orangetown Comprehensive Plan. One of the
stated goals of the plan was to come up with ways to try to
alleviate the housing shortage, hopefully helping with the
affordability issue. Going through this process helped me gain
a better understanding of the issues from a more localized
level.
More important than all of that is that I am the mother of
two young adults, ages 27 and 29, both of whom are currently
renting because they cannot afford to purchase a home of their
own. Moreover, I have watched as their friends and colleagues
have moved out of New York to places like North Carolina,
Colorado, Pennsylvania and Tennessee for jobs in locations that
are much more affordable to live, and it is very likely that
these young New Yorkers will not return.
As to what is causing the housing crisis, it is complicated
and there are several factors at play. Sadly, there is no quick
or easy answer for how to fix it. I will start with how I
believe it got started. While there was already a bit of an
affordability issue before COVID, it was made significantly
worse when coronavirus disease (COVID) hit. Thousands of NYC
residents, now able to work from anywhere, fled the city and
relocated to the suburbs, creating a huge shortage of homes and
driving up the sales prices even higher. It was a simple case
of supply and demand, and it happened throughout the entire
region.
Further fueling the shortage and rising home prices is that
many seniors, like myself, are opting to age in place. With
their mortgages paid off and the cost of renting so high, it is
simply more cost effective to remain in their homes, removing
these properties from the inventory that might otherwise be
available. Similarly, young couples in their starter homes with
a 3 percent interest rate are not moving to larger homes due to
the increased interest rates and house prices.
Another factor affecting affordability that cannot be
ignored in New York State, is the high real estate taxes. Using
a homeowner in Orangetown with a home appraised at a market
value of $612,000, the tax burden is approximately $14,000 a
year, adding another $1,167 to their monthly costs. Factor that
in with high interest rates and home prices, and many people
just cannot afford it.
Another obstacle facing municipalities is their outdated
zoning laws, most of which were adopted many, many years ago.
These laws traditionally call for single-family homes, separate
and far away from any downtown or commercial areas. To this
day, town boards across New York State, including my town
board, are hesitant to change zones or approve projects that
are not consistent with this outdated zoning approach. Any
mention of multifamily, cluster, or mixed-use housing is
frowned upon and seen as too urban by many. Any talk of a
Transit-Oriented Development, which allows more density by
train stations, is rejected outright.
However, what those pushing single-family homes as the only
means to address the housing shortage need to understand is
that even if a builder can find land, the approval process in
New York is expensive and lengthy, adding to the already high
cost of new construction. With fees for everything from the
building permit to the land use board applications and
consultants, these added costs in terms of both dollars and
time are what deters many builders from building single-family
homes. Add in supply side challenges that are just now
recovering since COVID and a tight job market, and it is clear
that the single-family housing market will not be solving the
housing shortage any day soon.
While the causes of the problem are to some extent obvious,
the more difficult question is what can be done to solve them
and to foster more housing growth. I will start by saying,
clearly and unequivocally, that any proposals coming from the
State or Federal Government should be in the form of an
incentive. Two years ago, local officials across New York State
were 100 percent against Governor Hochul's proposal to mandate
the legalization of accessory dwelling units, or ADUs, with
absolutely no consideration for local issues, such as parking,
traffic, water, and sewer.
While I applaud Governor Hochul for wanting to help with
the problem, New York State officials should be looking to work
with local elected officials, not against them. She should rely
upon those elected by the community, as they are best suited to
know what will or will not work in their respective
communities.
I will say, without hesitation, that local governments need
to step up to the plate. They need to look for ways to
streamline the approval process and to amend outdated zoning
and planning laws to allow for more flexible and dense housing
styles in non-traditional settings. They must engage with the
public and educate them on the need to adapt to a changing
landscape, to reinvent our notion of what a home looks like. So
whether it is the repurposing of a mall or office building, or
the creation of mixed-use zones that combines residential with
commercial use, we must find innovative ways to increase the
housing inventory and affordability.
While the housing shortage and affordability problem is
complicated, I believe that with all levels of government
working together, with an understanding and respect for the
very important role the local government plays, there is a path
to solving the problem. As a town supervisor and as a mother,
this issue is a priority for me, and I look forward to working
with my counterparts in government to find solutions.
I thank you for your time today and am happy to answer any
of your questions.
[Prepared statement of Ms. Kenny follows:]
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Chairman Davidson. Thank you, Supervisor Kenny.
Mr. Ketcham, you are now recognized for 5 minutes for your
oral statement.
STATEMENT OF JOHN KETCHAM, FELLOW AND DIRECTOR OF CITIES,
MANHATTAN INSTITUTE
Mr. Ketcham. Chairman Davidson and honorable members of the
subcommittee, thank you for the opportunity to testify.
My name is John Ketcham, and I am a Fellow and Director of
Cities at the Manhattan Institute, where my colleagues and I
produce research and advocacy aimed at keeping America and its
great cities prosperous, safe, and free.
Throughout its 400-year history, New York City and its
surrounding area have provided countless opportunities to
immigrants and natives alike, helping to shape the concept of
what it means to be an American and achieve the American dream.
New York's promise is under grave threat from its ever-
worsening housing affordability and supply crisis. Just this
month, the New York City Housing and Vacancy Survey revealed
that the city's overall rental vacancy rate plunged to 1.4
percent, the lowest level since 1968. Today about 52 percent of
city renters pay 30 percent or more of their pretax income on
rent. Unaffordable housing prices tell those who dream of
making it in New York that the city has no room for their
dreams.
By driving away invaluable human capital to areas with
lower housing costs, New York's policies are hampering not only
its prosperity but the nation's, too. One study found that the
failure to build enough housing in high-productivity cities
like New York reduced aggregate U.S. growth by 36 percent
between 1964 and 2009. In short, all Americans are poorer
because of New York's housing policies.
The fundamental problem is one that Americans of all
political persuasions can agree on--too few new housing units
are being built in and around New York City relative to demand.
Between 2009 and 2019, the city added approximately 3.9 jobs
for every housing unit permitted.
Numerous decades-old government policies hamper new housing
supply, with a combined effect greater than the sum of the
parts. Restrictive zoning requirements, such as use
limitations, parking mandates, building size, and lot coverage
restrictions and large minimum lot sizes limit construction and
drive housing prices higher.
New York City's rent stabilization law and its 2019
amendments have not addressed the supply shortage and have
likely worsened vacancy rates. The State legislature's repeated
failure to reauthorize a property tax abatement program for
large, new rental developments in New York City risks severely
curtailing private investment in rental housing.
At the same time, political realities dictate that New
Yorkers, like Americans elsewhere, cherish their existing
communities. Homeowners and long-term tenants do not wish to
see wide-scale sudden and disruptive changes to the places they
call home. Constituents and political leaders from both major
parties value local control over most land use decisions.
So to alleviate today's crushing housing burdens New York
State and its local governments must loosen restrictions and
facilitate new housing construction. Options are available that
would allow for more supply without substantially infringing on
local control over land use, including the following:
The State legislature could grant homeowners the right to
build an accessory dwelling unit, or ADU, on their properties,
which would allow them the freedom and flexibility to use their
property as they see fit, such as to house a relative or to
earn additional income.
State law could also reauthorize a property tax incentive
for large rental developments in New York City, lift the 12 cap
on residential floor area ratio, streamlining office-to-
residential conversions in newer buildings, and exempt most
residential upzonings from costly and time-consuming
environmental reviews.
The Adams Administration has proposed constructive measures
to eliminate parking mandates, allow ADUs, and more office-to-
residential conversions and upzone residence districts citywide
to allow gradually for more housing supply where there is
demand for it.
For its part, the Federal Government can foster new housing
production, without infringing on traditional boundaries of
federalism, by reforming tax cost recovery. Shortening
depreciation schedules or adjusting depreciation deductions for
inflation are ways of reducing the net cost of development,
encouraging greater private housing investment.
Though daunting, New York's housing challenges are not a
matter of technical infeasibility but of political will to
adopt the policies necessary to build more housing.
Time is of the essence. New York's long-run competitiveness
and, most importantly, the well-being of its residents are at
stake. Thank you, and I welcome any questions.
[Prepared statement of Mr. Ketcham follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Davidson. Thank you, Mr. Ketcham.
Ms. Goodridge, you are now recognized for 5 minutes to give
your oral statement.
STATEMENT OF LEAH GOODRIDGE, MANAGING ATTORNEY FOR HOUSING
POLICY, MOBILIZATION FOR JUSTICE
Ms. Goodridge. Chairman Davidson and honorable members of
the committee, thank you for the opportunity to testify this
morning.
My name is Leah Goodridge, and I am the Managing Attorney
for Housing Policy at Mobilization for Justice, one of the
largest legal service providers in New York. In my role, I
supervise a team of lawyers who represent low-income tenants
facing eviction. In the last 12 years, I have litigated on
behalf of hundreds of tenants, an experience which has afforded
me a front-line view of the housing crisis.
I also determine housing policy in New York. In 2018,
former New York City Mayor Bill de Blasio appointed me to the
New York City Rent Guidelines Board, which determines rent
levels for rent-regulated apartments. There I read reports and
data, heard from experts, and both tenants and landlords alike.
For the nearly 4 years that I was on the board I saw how rent
stabilization operated in policy and practice.
We are here today to examine the failures of status quo
housing policy, and New York is the ideal place to center this
discussion. This is an opportunity to examine what works and
what does not work. Rent stabilization works. It works to
directly address the housing crisis by ensuring that some
apartments remain affordable. Currently, many of the eviction
cases that I am seeing are in private, unregulated apartments.
Recently I spoke with Ms. P. She is 62 years old with
physical disabilities. She has been living in a private,
unregulated apartment for the last 7 years, but her landlord
recently decided not to renew the lease. From the landlord's
accord, she is up to date with rent and there have been no
disagreements. Yet this is how it works when housing is not
regulated. Tenants like Ms. P become ensnared in a vicious
housing market that likely will not yield an equally affordable
apartment. Now, predictably, she is facing eviction with
nowhere else to go.
Ms. P's experience is a direct response to critics who
argue that rent stabilization should not exist at all. Relying
entirely on the private market for all housing would create
instability in the housing market.
Now let us talk about if Ms. P's apartment was, in fact,
rent stabilized. For one, her landlord would have to evict her
based on whether she breached the lease or not, and second, she
would likely be eligible for two programs which freeze her
rent--this is the Disability Rent Increase program, or the
Senior Citizen Rent Increase Exemption program, which freezes
her rent at the current rate while providing property owners
with a tax exemption. This is what New York City gets right,
and this model should be replicated elsewhere.
I also just want to quickly note that when we are talking
about new apartments and new housing that is being built, most
of it is not rent stabilized, so our rent stabilized stock is
sort of fixed as it is. So when we are talking about new
housing it mostly includes mandatory inclusionary housing--that
is 30 percent--that is not rent stabilized.
Building housing without adequately investment in
affordable housing does not work. So I want to briefly talk
about some issues with affordable housing. For one, a lot of my
clients cannot access newly built affordable housing. This is
for a few reasons. First, most income-restricted units are
devoted to moderate-income residents, not extremely low income.
Affordable housing used to be called low-income housing because
that is the income target it achieved. However, there is a
chart from the mayor's recent report that shows that extremely
low-income units comprise the least of all of the income-
restricted units for started and completed housing projects in
the Fiscal Year of 2023. Working class people who are vital to
the prosperity of American communities--these are delivery
workers, taxi drivers, home health aides--are on the margins of
it with little safety net to help them from falling into the
abyss.
Let me provide a prospective. Sometimes a lot of affordable
housing that is available, the income might start at $60,000,
it might start at $80,000 to be eligible to even get into
affordable housing, and these are the income restricted units.
Sometimes the actually rent is $2,000 for a studio in the
Bronx. So this is where we talk about investing in affordable
housing, it needs to be adequate because when we have this
being relied on completely by private developers sometimes they
say, ``I do not have enough money'' so that we can actually
have more of these deeply affordable units, and this is where
government can invest more in affordable housing. It will not
work if it is entirely on private developers to do.
That is my time. Thank you so much for the opportunity. I
had so much more to say, but I guess I will say later.
[Prepared statement of Ms. Goodridge follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Chairman Davidson. Thank you, Ms. Goodridge. I appreciate
your testimony and thank you to all of our witnesses. I would
also like to recognize Mr. Lawler for an opening statement.
OPENING STATEMENT OF HON. MICHAEL LAWLER, MEMBER OF THE
SUBCOMMITTEE ON HOUSING AND INSURANCE, A U.S. REPRESENTATIVE
FROM NEW YORK
Mr. Lawler. Thank you, Chairman, and good morning,
everyone, and thank you for joining us here today at our field
hearing here in Rockland County. I want to thank County
Executive Ed Day and our Chairman of the County Legislature,
Jay Hood, for allowing us to use the county office building
today for this hearing.
I would also like to recognize some of our elected
officials who are here--County Legislator Paul Cleary; County
Legislator Will Kennelly; County Legislator Jesse Malowitz;
County Legislator Aron Wieder; Deputy Mayor of the Village of
Haverstraw, Gil Carlevaro; Pomona Mayor Ilan Fuchs; County
Executive Ed Day's Chief of Staff John Lyon; Deputy County
Executive Mike Hoblin; our Commissioner of the Department of
Social Services Joan Silvestri; and we also have
representatives from Senator Bill Weber's office and
Assemblyman John McGowan's office as well. Thank you all for
joining us.
One of the most common refrains that I hear when discussing
housing with residents of the 17th District are their concerns
about the affordability of housing. It remains a persistent
challenge, with mortgage rates near their highest since the
turn of the millennium, a limited housing supply in many
communities, ongoing supply chain and construction issues, and
high taxes. As we all know, in Rockland and Westchester
Counties, we pay among the highest property taxes in America.
It is perhaps the most difficult time to purchase a home in our
region's history.
This is true in many places across the country right now,
thanks, in part, to the out-of-control spending that was pushed
in Washington and in Albany, which helped drive record
inflation. Over $5 trillion in new spending was signed off on
by my colleagues on the other side of the aisle during just a
2-year span, leading to sky-high interest and mortgage rates,
which has put many seeking housing on the back foot.
The housing crunch is further complicated by the fact that
many homeowners remain unable or unwilling to sell their home
for fear of losing their fixed, low-rate mortgages obtained
prior to 2022. This is causing the limited supply to increase
price, while also seeing home sales fall over 16 percent in
2023 compared to 2022. The median cost to purchase a home is
more than 5.6 times greater than the median household income
nationwide. In Rockland and Westchester Counties, according to
the National Association of Realtors, the monthly cost of a
mortgage was $1,000 more in 2023 than it was in 2022, and in
Putnam and Dutchess Counties it was at least $800 more per
month. In both instances, these are additional housing costs of
almost $10,000 or more a year. For many families that is
unsustainable.
When you look at some of the other challenges we are
dealing with an area like the Hudson Valley--infrastructure,
water, sewer, roads, bridges, schools, personnel, we are
reliant on an all-volunteer fire service here, EMS, police--all
of this plays a role in the ability and the availability of
building new housing stock. When you look at what the Governor
proposed just in the last 2 years, there is a reason there was
broad bipartisan opposition to it, and it is not because people
do not realize the need for housing. They do. It is because
there was no plan to actually address the real infrastructure
needs of our municipalities. There was no cooperation and
coordination with local governments in the best way to address
these challenges.
As we move forward I am hopeful what today's hearing will
lend is some insights into what we can accomplish with sound
fiscal and housing policies, both here in the Hudson Valley and
around the country.
Thank you, Mr. Chairman.
Chairman Davidson. Thanks, Mr. Lawler. I would also like to
recognize Mr. Flood for an opening statement.
OPENING STATMENT OF HON. MIKE FLOOD, MEMBER OF THE SUBCOMMITTEE
ON HOUSING AND INSURANCE, A U.S. REPRESENTATIVE FROM NEBRASKA
Mr. Flood. Thank you, Mr. Chairman. We are a long way from
Nebraska this morning, but it goes without saying that you have
an exceptionally talented Member of Congress representing you
in Washington. I sit next to him, and you should be very proud
of the representation that you are getting from someone that
has hit the ground running and is proving himself every single
day. That is one of the main reasons I wanted to be here today,
to have this conversation.
Mr. Lawler. Thanks, Mike.
Mr. Flood. Supervisor Kenny mentioned that 3.9 jobs were
being created for every 1 housing unit, I believe, in her
testimony. We have the same issue in my district, where we
have, in the State of Nebraska, 80,000 open jobs, and our
ability to fill those jobs rests solely on our ability to have
the housing for them. In the last 3 years, really since 2019,
we have seen inflation of 16 percent in housing costs just to
build, and on top of that the interest rate now is hovering 7
to 9 percent, depending on the day.
So I am interested in talking about solutions for
especially workforce housing. I am the author of a bill that is
called Yes in My Backyard Act. Mr. Ketcham and I briefly
touched on that before this hearing. I would like to have the
opportunity to unpack that. I will tell you, as a Member of
Congress, I recently read about the significantly large number
of indictments concerning housing in the city of New York.
Accountability, and accountability for people that manage
Section 8 housing, is absolutely necessary. It undermines our
ability to care for the most vulnerable, make sure they have
the right kind of housing, but also if we are failing in public
housing, we are failing in America everywhere else. As a Member
of Congress, I applaud the work of the U.S. Attorney in the
Southern District of New York, and we are following this across
the Nation.
With that I yield back, Mr. Chairman.
Chairman Davidson. Thanks, Mr. Flood.
We will now turn to member questions. I recognize myself
for opening questions. Our hope is that we will do at least two
rounds through this, and we will be a little more free-flowing
with questions. Thank you for your opening statements and your
expertise.
Ms. Goodridge, I just want to follow up on one of the
things you referenced in your opening statement about
unregulated housing. I thought everything is regulated in New
York. I just want to clarify, there are planning and zoning
laws, there is some level of regulation. What do you mean when
you say ``unregulated housing?'' Not subject to rent
stabilization, not subject to price controls?
Ms. Goodridge. Not subject to rent stabilization.
Chairman Davidson. So not price-controlled housing.
Ms. Goodridge. For example, it might be a two-family house
that has an apartment, so yes.
Chairman Davidson. Okay. Thanks. I just want to be clear.
I will turn initially to Mr. Amicucci and Supervisor Kenny.
While expanding the supply of housing is obviously critical, it
is equally important to recognize the sovereignty of local
jurisdictions in making these decisions without heavy-handed
effects of either State or Federal authorities. You know, I
note that Martha's Vineyard does not want high-density housing,
for example, and the people of that place should probably
decide whether they have high-density housing, not someone from
Washington, DC. Lots of people agree with that, but they might
feel differently about a suburb next to a city.
Mr. Amicucci, could you speak to efforts at the State level
in New York to implement high-density zoning and what
communities have done in response?
Mr. Amicucci. Well, there are many communities in New York
that are going to resist with high-density zoning, and I think
if it is done intelligently it is something that could be taken
into consideration.
The people that are looking to increase the number of units
that we have in New York State, I think we should focus on the
low-hanging fruit, where if you can relax some of the
burdensome laws that have been passed in the last couple of
years I think that would free up a lot of units and be able to
accommodate not everybody but some of the people that are
looking for housing.
As far as the zoning, I am not a proponent of eliminating
all zoning. I am a proponent of being smarter with the zoning.
I think that high-density zoning, in certain areas, might make
sense.
Chairman Davidson. Ultimately the local government should
make the decision on that----
Mr. Amicucci. Absolutely. That is not a--I am sorry.
Chairman Davidson. Yes. I want to turn to Ms. Kenny so I
can get some input from everyone on this. You know, you are
trying to grow jobs. There are lots of opportunities, but how,
as a local government official, do you balance those decisions?
Ms. Kenny. I think one of the perfect examples is the talk
of these ADUs, which were mentioned. Two years ago, the
Governor was looking to basically mandate it. The local
municipalities could not not allow them. Basically, we have all
these environments or [unclear] required. That was going to be
out the door. Anything to have to do with these ADUs.
So, of interesting, the town of Orangetown actually has an
accessory dwelling unit on our books. If an owner in Orangetown
lives in the house for 15 years, they are going to remain in
part of the house, they can have an accessory dwelling unit. It
is a way to keep our seniors in their home and afford it.
The way it was being proposed from the State was I could
come in and buy a house and it was basically a two family,
without consideration for our parking, which we already have
issues in parts of town, traffic, water, sewer, all the things
that are local. So that is when I say that the State and
Federal Governments, to the extent they need to, work with the
local governments.
There are things we can do. We have to be creative. Again,
we are unique in Rockland County for having this on our books.
It is something that would encourage the other municipalities--
--
Chairman Davidson. That is a growing option for a lot of
folks, to be able to add to density on single-family lots. I
will just try to get a little time from you, Mr. Ketcham.
You have experienced research on the issue of bureaucracy
in the administration programs. To shed light on the program I
introduced a bill that will establish an independent commission
to reform HUD, to update some of the authorizations to try to
deal with benefit cliffs and standardized income and asset
tests, things like that, problems that the people that
administer these programs say impact their ability. Could you
provide some examples, at any level of government, on the cost
of bureaucracy and the disruption of the intended effect?
Mr. Ketcham. Thank you for the question. We can look to New
York City for a good example in the Uniform Land Use Review
Procedure (ULURP) process, which is triggered upon rezoning
applications. That is formally a 7-month process but it often
takes much longer. It involves costly environmental reviews and
just going through that process can add up to $50,000 in the
eventual cost of a housing unit that is built, not to mention
the time that it takes. That is according to the Citizens
Budget Commission.
Right there you are seeing the addition of costs to an
already expensive housing market, where land value is already
very high, where New York is a place where lots of people want
to live because that is where the action is. That is where all
the jobs are in the area. That is where opportunity is. So your
land value is already going to be high. Your construction
values are also going to be high and if you layer on top of
that additional bureaucratic costs then you are going to make
any type of housing you build out of reach of practically
anyone. So the all-in cost of development can reach $3,000 to
$4,000, and that is not adding in----
Chairman Davidson. Which puts the price out for a lot of
people.
Mr. Ketcham. Precisely.
Chairman Davidson. Then the answer for some is to spend
more money and subsidize it with policies.
So I will turn back to you when I come back, but I want to
kind of keep the things moving here with some of my colleagues.
I recognize Mr. Flood, from Nebraska, for his questions.
Mr. Flood. Thank you, Mr. Chairman. Mr. Ketcham, in your
written testimony provided to the committee prior to today you
talked about homeowners as site value capitalists. Can you
explain to me what you mean by that term?
Mr. Ketcham. Yes. Thank you for the question. I can relate
it to the issue of ADUs. ADUs are an economically valuable
entitlement to homeowners. They encourage homeowners to add
more housing supply by granting them the ability to add supply
where there is demand for it and so, this provides a property
right. It provides the homeowners the freedom and the
flexibility to use their properties in the way that they see
fit, not the way that heavy-handed bureaucracies would have
them see fit.
So there is a balance here. The State and local governments
need to work together to plan for growth, and sometimes when
ADU restrictions are so onerous in that they prevent homeowners
from adding this supply, well, then you are just not going to
get that type of supply growth that you really need to move the
needle to provide the growth and the economic opportunity that
people are looking to obtain in moving to New York.
Mr. Flood. Following up on that, these environmental
reviews, talk about what kind of a barrier they are. This is
something I do not think we have in my part of the country, but
talk about what is an environmental review and what is its
impact on housing supply.
Mr. Ketcham. An environmental review is mandated under
State law for, for instance, discretionary zoning actions,
upzonings, and that means that within the process of upzoning
there is months-or even years-long requirement to study all of
the environmental impacts, even for what could be a relatively
mundane type of development. My colleague wrote a paper in
2020, looking at very straightforward residential
redevelopment--I believe it was a florist, and then they wanted
to go up with housing. That took over 900 pages of
environmental impact statements and reviews, and that only adds
to the costs of new development. Those costs are going to be
passed on to the eventual unit buyers or to the renters of that
unit.
So we need to find ways of making development costs
feasible and to lower them so that more deals will pencil out
and that those savings can then be passed along in the form of
greater affordability to the eventual renters or home buyers.
Mr. Flood. Given the emphasis on environmental reviews, how
do these reviews treat multifamily housing in creating denser
neighborhood, which, by every argument, would be more energy
efficient? Do they reward multifamily housing, these
environmental reviews?
Mr. Ketcham. Quite the contrary. In fact, they represent a
bias in favor of the status quo because they essentially put
the burden on new development without recognizing the risks of
the status quo. If you do not build enough environmentally
friendly multifamily housing in New York you will divert
population growth to other areas of the country that are more
dependent on automobiles, less dependent on mass transit. So
you are essentially not looking at the holistic environmental
impact but you are looking at only a very small, regionalized
impact, and just a site-based impact, in fact.
So I do not think it really makes a lot of sense to require
these environmental impact statements for residential
development in the greenest city in the country, New York City.
Mr. Flood. Supervisor Kenny, I can see by your nonverbal
that you have some comments here.
Ms. Kenny. No. I happen to agree. I think New York's
requirement, or a lot of the environmental reviews, may be
extreme in certain circumstances, but it does come down to
balance, because as somebody who is representing the community
that is already there, traffic, air quality, noise, all of
those factors get looked at in the environmental review and
that is important for the neighbors that are there, so we just
do not go in and say we need multi--and again, I support the
need for more housing and more dense housing in appropriate
locations, but you just do not say we are going to disregard
the environmental reviews because we need this, because
ultimately the residents that are still there are the ones that
are going to be coming out. They are sometimes the most vocal
against these projects, but it is all about balance. It is
enough of an environmental review, so we are protecting the
current residents, but not too much where we are prohibiting
the buildings from building into a new job.
Mr. Flood. With the chairman's consent I would like to
allow Ms. Goodridge to respond.
Ms. Goodridge. Sure, and I also wanted to piggyback and say
two things. One, I think sometimes when people hear of
environmental review they think of only pollution and so forth,
and very strict environmental issues, but I just wanted to
point out that it also includes things like school size.
Sometimes a housing project may have 300 new units, and that
might bring 1,000 families to a neighborhood, including many
children, and the local schools might actually not have enough
room for all of the new children that housing project may
bring. That is part of the environmental review, to assess
whether the local schools have enough room, have enough
capacity; so, that is really important.
I also wanted to point out that in New York one of the
proposals that the mayor has proposed--which has not passed as
yet--is to limit environmental reviews for projects that are
under 200 to 250, so that they do not have to go through
environmental reviews. So that is something that is pending,
but I did want to piggyback and say that it is vital, and I do
not think that we should completely nix it.
Mr. Flood. I yield back.
Chairman Davidson. Thank you, Mr. Flood. I now recognize
Mr. Lawler, from New York, for his questions.
Mr. Lawler. Thank you, Mr. Chairman. Nationwide we are
short about 6 million units, and counting, and it is only
growing by the year. In New York City right now, in large part
due to rent control, they have about 50,000 vacant units
because the cost of upgrading the unit to code is significantly
more than you can recoup. So what a lot of building owners are
deciding to do is take the tax write-off, understandably. So
you have 50,000 vacant units in a city that desperately needs
housing.
We lead the Nation, New York State does, in outmigration,
and yet we still have a major housing crisis. Obviously, in an
area like Rockland and Westchester, where we know we have the
highest property taxes in America, and not through the fault of
our municipalities or our local government, it is a function of
the high cost of living in the suburbs. We have some of the
best schools in the country here in our communities, but it
costs money, and it continues to rise.
The average home price, over the last 4 years, has
increased by $400,000 in Westchester and $300,000 in Rockland.
Now part of that, as Supervisor Kenny pointed out, is a result
of the outmigration from New York City during COVID, which
severely limited the supply and jacked up the price. People
were over-bidding on the sale price by significant amounts of
money, tens of thousands, to purchase the home.
Supervisor Kenny, obviously Rockland County is not New York
City. We do not have any cities within Rockland County. It is
primarily suburban. We do have, obviously, a number of
villages, downtown business districts, but it is primarily
single-family residential with some high-density housing.
Policies that may work in an urban center do not necessarily
work in a community like ours.
What are some of the things Orangetown has done in recent
years to address some of the housing shortages, whether it is
planned activity center (PAC) zoning to build senior living,
whether it be rentals or purchase. What are some of the things
that Orangetown has been doing to try and actually build the
housing stock while still respecting the suburban nature of the
community?
Ms. Kenny. First of all, we did just go through the
comprehensive plan, which, for people who do not know, it is
something a municipality is supposed to do every roughly 10
years. Ours had not been done in roughly 25 years, so our
comprehensive plan was so outdated. We just updated it, and we
put in all these ideas, that we need to look at alternate--
again, back to my comments--reinvent what we think is a home.
We have these strip malls that are empty and these offices, so
we are looking at allowing them to be developed into
residential units, which would be great because it is
repurposing a property that is already there.
We do have our PAC zone, which is basically for 55 and
older. It does have an affordability component. The builder
will get more units if they build a senior--a certain number
they have to give us affordable units.
We are taking steps. Unfortunately, it is just not really
fast enough to keep up with the demand. Again, it goes back to,
I have made this a priority. I am only in office a couple of
years, and it is definitely front and center for me to find
ways to create more housing units. Again, we are not New York
City, and as many of the residents like to tell me when we are
talking about these things, we do not want to be New York City.
We have to find ways that work within the confines of
Orangetown.
Mr. Lawler. Mr. Ketcham, from the Manhattan Institute's
standpoint, what are some of the things that suburban
communities can and should be looking at compared to a more
urban center, where it might be obviously easier to develop
multifamily housing and/or obviously high-density housing when
you are talking about high-rises and other types of housing?
Mr. Ketcham. Thank you for the question. Suburban
communities, like other communities, value the character of
their neighborhoods, and so they could look to build in gentle
density that does not materially impact the existing character
of a neighborhood. This is why ADUs are such an important and
valuable tool in the arsenal of new housing supply. They can be
put in the rear yard of an existing home or in a basement or
attached to the dwelling. They do not materially change the
look of the neighborhood, and they add density in the most
gradual and gentlest way possible, where there is demand for
it, and give the homeowner the incentive to add the supply as
well. So you are turning a constituency that is ordinarily
opposed to new housing supply in favor of it. That is one way.
Another way is by lowering minimum lot sizes. You can still
combine lots, of course, but when lot sizes are too big it has
the effect of forcing home buyers to consume more land than
they otherwise would, and thereby increase the cost of housing.
So those are two ways of building density gently.
There is also an argument to be made for transit-oriented
development but in a much narrower sense than what Governor
Hochul proposed. It was too expansive and it was too dense into
communities. So for Zone 1 it was 15 miles outside of the
perimeter of the train stations. If you look to a State like
Massachusetts, I believe that would have been about a tenth of
what the Governor proposed. Even if you take the center point
of a train station and extend a half-mile radius around it, per
Governor Hochul's proposal, that would be about 500 acres, and
Massachusetts has a transit-oriented development (TOD) plan
that only goes to, I believe, 50 acres, or thereabouts.
So there is a role for suburban communities to build in
more housing near transit, but in a gentle and contextually
appropriate way.
Mr. Lawler. Mr. Chairman, if I may just respond to that. I
think part of--and I would agree both on TODs and accessory
dwelling units, but part of it is for the State to incentivize
as opposed to mandate. So a TOD, we actually, under the prior
supervisor, looked at the potential of a TOD in Pearl River,
where I live, and in part to help beautify the downtown
district and incentivize property owners to reface the
buildings, potentially they could add on apartments on top of
their existing commercial property, which could be positive for
them, obviously, from the standpoint of rental income, et
cetera, and benefit the town in terms of having additional
units, which also helps a downtown business district thrive
because you need people there. You need people to come into the
stores.
The accessory dwelling unit legislation that was proposed
would mandate every municipality, as the supervisor pointed
out, without any understanding or foresight into how that would
impact traffic, sewer, water, police, fire, schools and so,
that is part of the problem here. I think the other aspect of
what that law would have done, it would not have required the
homeowner to live on the property after 1 year.
To me, it is how do we incentivize it, incentivize
municipalities? What are we doing as a State to help invest in
the infrastructure? New York State got 10 percent--10 percent--
of the Bipartisan Infrastructure Act, the moneys are coming to
New York State, $100 billion to help with infrastructure. We
should be utilizing that money to help incentivize
municipalities to help with the housing stock.
Chairman Davidson. Thank you, Mr. Lawler. I recognize
myself for another round of questions. We will hopefully have
at least one more round after this.
I kind of want to pick up on Housing and Urban Development
(HUD), and kind of tying together HUD, which is focusing in on
the whole country, and what we were talking about with planning
and zoning. I mean, frankly, is there anyone who believes that
local planning and zoning laws should not prevail over State or
Federal zoning laws? I do not think, on the panel, anyone does,
but there are advocates for that. The reality is policies get
brought up, just like the one Mr. Lawler said, that do reach
past that. Certainly some of the policies are not just planning
and zoning policies.
So picking up where I left off with you, Mr. Ketcham, and
maybe for the panel, are there specific issues at the local
level where we should be aware that relate to HUD or Federal
agency policies that are impacting the ability for local
communities to make their own decisions?
Mr. Ketcham. Thank you for the question. The most cost-
effective use of HUD dollars is in rental vouchers, that kind
of subsidy, rather than subsidizing project-based affordable
housing development, which tends not to go quite as far. There
was a Tax Foundation report that found that low-income housing
tax credit developments were more costly than private market
developments. So if you allow the private market to build and
then expand voucher subsidies you would get the best of both
worlds.
So it is a matter of looking for the most cost-effective
use of HUD dollars, and vouchers tend to be the best use of
that.
Chairman Davidson. Thank you. Mr. Amicucci?
Mr. Amicucci. Yes. I totally agree with Mr. Ketcham. You
have a bill, the Choice in Affordable Housing Act, that is
floating around in Congress and in the Senate right now. IREM
and myself and a lot of people that I am associated with would
absolutely support that and think that would be a great way to
go. We think that increasing the number of Section 8 vouchers
around the country would absolutely help the lower income,
which is the area of expertise that I have. I deal with a lot
of low-income families. I have 48 units, and 90 percent are
Section 8.
A lot of my counterparts do not like to deal with Section 8
because of some of the onerous requirements that are put on
them. I think if we can address that I think that would
incentivize more use of vouchers.
I would just like to address a statement that Congressman
Lawler made, was that there are 50,000 units that are not
available in New York State as a result of rent control. Rent
control has something to do with it, but more importantly it
was the Housing Stability and Tenant Protection Act of 2019
that resulted in those 50,000 units being unoccupied. Those
created enormous disincentives to owners to invest in apartment
units, and what is happening, and what will happen, is you are
going to have a housing stock similar to New York City Housing
Authority (NYCHA), which I would like to address a comment that
Congressman Flood made.
You used public housing in Section 8 in the same breath.
Public housing is different than Section 8. Section 8 is
Section 8, and public housing in New York is what we consider
NYCHA, and that is not an example of what we should be doing.
NYCHA is the largest landlord in the city of New York, and they
do not follow their own rules and that is not what we want to
purport. Section 8, if done in a proper way, will incentivize
better housing stock and, in my opinion, more housing stock,
both in New York and throughout the country.
Chairman Davidson. Thank you for that. You know, you look
at Section 8, it does put the voucher in the hands of the
person that is selecting where they would live. It does a lot
of flexible things that a central planner cannot do.
While we are on the subject of NYCHA, really the New York
Public Housing Authority is not uniquely bad but it is
certainly bad. There are lots of problems there. In fact,
someone came into my office and suggested that we could turn
them into communes and have actual communists run them, and it
would improve the conditions because the people that live there
would at least take care of the place. You have lots of units
that are not actually available to be used, and this is the
same in DC Public Housing Authority. I questioned Secretary
Fudge about that, and we are paying for things that we are not
getting, and it has not been very effective.
Would anyone want to comment on the challenges of
administering some of these programs? HUD, frankly, is not
paying enough attention to these, and you are seeing criminal
prosecutions because there is actual criminal activity in some
of these public housing authorities. Unfortunately some of it
is going unprosecuted. The people that we are intending to help
are the people that are not being helped.
Mr. Amicucci. Exactly. Yes. Chairman Davidson, I totally
agree with what you are saying there, and again, I do not want
to harbor on NYCHA but Section 8, in my opinion, if properly
done, would solve not all of the problems but a lot of the
problems that exist in the more denser populated areas.
Again, a lot of these development issues that have been
spoken about on the panel, they are difficult to do.
Development is difficult. It is very difficult to do but if we
can go after the low-hanging fruit and maybe relax some of the
onerous legislation that is currently on the books I think we
can pick up some housing units with the----
Chairman Davidson. I think of a couple of flow charts that
show how if you rent under these conditions with the voucher
program it is different than other Section 8 programs, and we
are looking at legislation to streamline that. I believe one of
the acts, the Choice Act that you referenced, would be helpful
in streamlining some of that.
Mr. Amicucci. Also, the point that you made about putting
the money in the hands of the tenants, sometimes they do not do
the right things with the money, and the rent does not get
paid, and then they are facing eviction. I am going to tell
you, I am a landlord, and I have had to evict people,
unfortunately. I have had to evict people who have a criminal
record and the fear in their eyes of being evicted from their
home versus facing a police officer putting handcuffs on them
is mind-boggling, okay. The fear of losing your home is
incredible, okay. It is a fear that a lot of people, thank God,
do not have to experience, but I have had the disappointing
opportunity to be able to witness this.
So instead of passing an earned income act where you give
the Federal dollars directly to the tenants, maybe you increase
the vouchers that are out there. There are municipalities
that----
Chairman Davidson. It strikes a different balance.
Mr. Amicucci [continuing]. the city of Yonkers has a 7,000
waiting list of Section 8 vouchers. They are no longer
accepting applications because they cannot do it but these
vouchers are gold. If they are used in the right way, they are
gold, and they guarantee that the rent is being paid. So
whatever else the tenant is doing, that person is going to be
pretty much guaranteed that they are going to have a roof over
their head, and that is a basic need that everybody has.
Chairman Davidson. Thank you for that. I now recognize Mr.
Flood for questions.
Mr. Flood. Thank you, Mr. Chairman. Mr. Amicucci, let us
just talk for a second about Section 8 housing. Prior to this
hearing beginning I spoke with somebody that was here in the
audience, and he was telling me about a situation where a
landlord accepted Section 8 housing for what was supposed to be
a short respite stay in a hotel, and that these folks were
living in filth, that there were drug dealers among folks that
were not drug dealers that were vulnerable, and that he was
getting paid $350 a week.
Who do you go to report that, to get that cleaned up, and
does it get cleaned up in this State?
Mr. Amicucci. It does. In this State it does.
Mr. Flood. He did not seem to think so. Who do you call?
Mr. Amicucci. Who do you call? You call the public housing
agency that is responsible for that Section 8 voucher. Every
Section 8 voucher is issued by a local public housing entity.
Mr. Flood. They will follow up and they will solve that?
Mr. Amicucci. Well, here is what will happen. You are
required to have a yearly inspection, okay. When I turn over a
Section 8 housing unit to Section 8 and accept their Federal
dollars I give it to them in pristine condition. It has to be,
otherwise it will not pass inspection. Every year that unit
gets inspected, okay, checks for smoke detectors, for----
Mr. Flood. What if there have been like 1,500 calls to this
unit over the course of 12 months? Do they look at that?
Mr. Amicucci. Well, I cannot speak for everybody but they
should be. They should be.
Mr. Flood. But are they?
Mr. Amicucci. I guess it depends on----
Mr. Flood. I am not interested in your opinion. I am
interested in what you known is fact.
Mr. Amicucci. Sometimes they do not follow up.
Mr. Flood. Okay.
Mr. Amicucci. Sometimes they do not follow up.
Mr. Flood. Can you explain the difference for me in New
York between rent control and rent stabilization?
Mr. Amicucci. Yes. Rent control was established right after
World War II, and it actually was a Federal mandate across the
country because soldiers were coming back from World War II and
there had been a lack of development around the country for
housing units. Unfortunately, scrupulous landlords took
advantage of that and raised the rent, and our veterans coming
back from saving us from the Nazis had no place to live. So the
government felt that we had to put some controls on the rising
cost of rent.
Now, in 99 percent of the municipalities out there rent
control went away. It sunsetted but in New York it stayed.
Subsequently to that, in 1974, New York and Westchester and
some other communities in New York State passed what they
called the Rent Stabilization Act, which is rent regulation. So
it is different than rent control, but it does the same thing.
At some point, the Rent Stabilization Act of 1974, which is a
New York State act, is actually worse than rent control,
because with rent control you actually, if you have a rent
control unit, after every 2 years you get a higher percentage
of increase than you would under the rent stabilized act that
was passed in New York.
So that was passed in the 1970s to try to further curtail
the rising cost of rents in New York City and some other
municipalities.
Mr. Flood. Thank you. I want to ask Supervisor Kenny and
maybe Ms. Goodridge, manufactured housing is something that our
Government-Sponsored Enterprises (GSEs), Fannie Mae and Freddie
Mac, say is a priority for them to address the housing crisis
because it is more affordable for working families to get into
manufactured housing. I think it is a real option in States
like mine. My concern for you is your land is so much more
expensive here than it is in a rural State.
So could you, Ms. Kenny, speak to that? When I am talking
about manufactured housing I am talking about homes with a
pitched roof. I am not talking about trailers, and I think
there is a development in Hagerstown, Maryland, where they are
really going deep on this, and it is a real option for working
families. Is this something that would be attractive to you as
a local leader?
Ms. Kenny. Well, I am certainly willing to consider any
options that would help with the problem. I will say, just as a
coincidence, a lot came up, a vacant lot, not far from my
house. It is an acre. They are asking $695,000. I do not know
if they are going to get it but that is going back to the cost
of land and how valuable it has become.
It is certainly something we can look at. I know it has
been used in the past by individual property owners. Like
someone would buy that to put a prefab up, may be more cost
effective but, yes, I do not think it is prohibited in the
code. I know some of my neighbors have done the prefab houses.
It is certainly something to look at, but again, it goes back
to the issue of the cost of the land.
Mr. Flood. One comment before I go to Ms. Goodridge for her
opinion. In my home State we have this thing called tax
increment financing, where if you purchased this $695,000 lot
you could basically not pay property taxes for the next 15
years and you could use what your property tax bill would be on
the improved, actually, and you pay that but it pays down a
bond that the city uses to put streets and make good things
happen in that area.
Do you have any tools like that in the State of New York
available to you?
Ms. Kenny. Not that I am aware of. They will pay property
taxes on that. I mean, they will be paying it on it, but it is
also based upon the value, and usually that is based upon the
construction, in this case, so the taxes would be much lower.
Unless you start getting into the business arena, where they
are bringing jobs, there are all sorts of incentives there but
for a single-family home or even a two-family home, you are not
going to get it now.
Mr. Flood. Ms. Goodridge, do you want to respond?
Ms. Goodridge. My mind went immediately to, back in old
times, when Sears used to ship the home.
Yes, obviously I am open to all kinds of housing measures,
and in New York, in particular, I am a tenants' rights attorney
but a lot of my clients, including myself, we advocate for more
home ownership, and unfortunately it is very difficult to be a
homeowner. In New York, in order to be a homeowner it is a lot
of co-ops and condos, so more housing would be helpful.
I wonder if it is okay if I address some issues about rent
stabilization.
Mr. Flood. Sure.
Ms. Goodridge. One issue, we were discussing a bit about
rent stabilization before, and one of the main criticisms is
that there is no means testing. I also wanted to point out that
for NYCHA, New York City Housing Authority, that is often all
criticized, even though that is means testing. NYCHA has a lot
of problems, obviously, but one of its main problems,
historically, is that it has not been fully funded as it should
be. A lot of the disrepair is because it needs more money to be
fully funded. When it was originally put into place a lot of
thinking around it was that this was a temporary measure, and
obviously poverty, unfortunately, does not last 5 years like
what was thought for public housing.
I also wanted to quickly address and just say that we do
need a mix of housing. Rent stabilization is important. Every
single housing does not need to be rent stabilized, but it is
important that we have a mix. For example, Section 8 was
mentioned. There has been a measure--and I mention that because
there has been a measure to move all types of housing to
private. So Section 8, for example, a lot of my clients have
Section 8 and a lot of landlords do not take Section 8. They
will flat out say, ``I do not take Section 8,'' even though
that is unlawful. You know, there are lots of reports about
this, lots of lawsuits.
So while we do want to increase Section 8 and we want to
fund it, we also have to be honest and cognizant about the fact
that even that form often has its challenges. I see a question
coming. Oh, okay.
Mr. Flood. Can I ask you a quick question, and then I will
yield back here. I talked to Mr. Amicucci about abuse of
Section 8 housing by landlords. Have you seen this? Is it
remedied? Do they take it seriously?
Ms. Goodridge. I was going to say, let us say that there is
a Section 8 tenant, like I think you mentioned earlier, and
then there are issues in the building. If that tenant goes to
that public housing agencies (PHAs) or the housing provider
that is Section 8, and they say, ``Well, my neighbor is doing
this,'' or ``This is happening,'' they are going to tell them,
``Go and talk to your landlord.'' If they go and talk to their
landlord it is really just hit or miss if they are going to do
anything and some do and some do not.
So in my experience the housing authority that runs Section
8--and that in New York, could be NYCHA, it could be HUD, it
could be HPD, there are various types of Section 8--in terms of
the wider problem set it is going to go back to the landlord.
If a tenant raises them, they are almost going to be laughed at
and said, ``Well, go and talk to your landlord. What are you
talking to us about this for?''
Mr. Flood. Okay. I yield back.
Chairman Davidson. Thanks, Mr. Flood. I now recognize Mr.
Lawler for questions.
Mr. Lawler. So there is no question we want to help those
who need the assistance, and I think, obviously, there are
programs, both through HUD and in New York State, to do that.
To just highlight the absurdity of some of this, my former
colleagues in the New York State Assembly, Linda Rosenthal, who
serves as the Chair of the Assembly Housing Committee, is
getting a rent stabilized apartment on the Upper West Side of
Manhattan for $1,573.37 a month. She inherited this apartment
from her grandmother, and the rent-stabilized cost with it.
Now she is making $142,000 a year, at minimum, and the
reason I know that is because that is the salary of a New York
State assembly member. It is absurd that somebody who is making
$142,000 a year is, frankly, in a rent-stabilized apartment
that they inherited from their grandmother. That is some of the
absurdity of the law, when you are actually looking at people
who need the benefit versus those who do not, and actually how
that is limiting the supply for people who need it.
So, yes, the 2019 laws are what dramatically impacted the
number of vacant units in New York City. There is no question
about that but to me, we should be helping those who need it.
When I look at NYCHA--I served on the Housing Committee in the
State Assembly. I was one of only four members to vote against
that NYCHA overhaul, which to me was nothing more than a scam.
It was shifting the assets from one entity to another so that
they could get more money from the Federal Government. They
have done nothing to actually fix the problems at NYCHA.
I think we had the inspector general of HUD in earlier this
year. I asked her, in testimony, ``Have you met with the
monitor at NYCHA?'' No. Meanwhile, you have over 70 people
arrested just a few weeks ago because of the corruption that
goes on at NYCHA, and I do not think it is fair to the
residents of NYCHA. I do not think it is fair to the people who
rely on public housing. We want them to be living in a safe
environment, in an apartment that is up to code, that is
quality, that has all the amenities that they should receive as
part of that.
So to me, part of this is looking at what we are currently
doing and how to fix it, not just complain about it or point
the problem out with it but how to fix it. I think that we have
to look a lot more at public-private partnership on this. I
think if we are talking about NYCHA, I think NYCHA needs a
complete overhaul, including potentially looking at bringing in
private investment to help, because there is just not enough
tax money to deal with this in the New York City Housing
Authority.
In addition to that, you look at--I just met with a
gentleman from Florida who owns over 100 acres of land in a
major city just outside of Miami, right in the downtown. It is
currently a mobile home park, and there are nearly 1,000 mobile
homes in this park. He is now building exclusively affordable
housing, in partnership with the municipality, inclusive of
building a new police station, a new city hall, a new community
center, a new charter school.
Now that is the type of innovative thinking we need to be
looking at, and that will work in an urban environment. It may
not work exactly like that up in the suburbs or in a rural area
but that is the type of innovative public-private partnership
that we need to be focused on if we are going to address the
housing shortfall. So he is going to go from 900 units,
basically, to tens of thousands of units in the same area, and
it will be exclusively affordable housing. I think that is a
pretty impressive model.
So the question to me is how do we fix the problem in New
York City, in particular, with NYCHA, and the public housing
challenge that we see there?
Ms. Goodridge. Okay. I am----
Mr. Lawler. A lot to unpack there.
Ms. Goodridge [continuing]. very, very happy that this has
been brought up because I have a lot to say. Thank you so much
for the question.
The first is you mentioned Assemblymember Rosenthal's
salary I guess is $143,000. I want to point out--and this is
what you said for a rent-stabilized apartment it is $143,000,
and the rent is around $1,500, but I want to point out that
under the Federal standards right now for affordable housing,
did you know that it goes up to, for one person, $165,000 for
just one person for an affordable, income-restricted apartment?
This is what I raised before about how you have these income-
restricted so-called low-income housing, even under the Federal
standards, and there are people who will set the standards,
they will set the low income at $80,000 to be able to access
this housing, and sometimes it goes up to $160,000.
So if it is not okay for an assemblymember to do it then
why is that the actual Federal standard right now? That is my
question. This is something that I raised. You know, people
come up to me all the time and say, ``Affordable housing right
now is a scam. I make $30,000 as an Uber driver and I am not
eligible to even get into so-called low-income housing.''
Mr. Lawler. Well, I have this argument with my colleagues
all the time, especially pertaining to the cap on state and
local taxes (SALT), for instance. If you are making $200,000,
as a family, in New York, that is about a cop and a teacher on
their salary combined. To be able to afford to live in an area
like this is extremely expensive, but I am not getting a
subsidy from the Federal Government on it or the State
government on it to purchase my home.
I think part of the challenge here is the numbers are
certainly all over the place in terms of what somebody would
qualify for or why, but $142,000 is significantly higher than
the median average in this country, as far as a salary goes,
and certainly in the State of New York, and certainly in the
city.
So if she is in a rent-stabilized apartment and you are
looking at where everybody else is, that, to me, is part of the
challenge here. If you own the building, what are you supposed
to do when your taxes continue to go up, when utilities
continue to go up, and you can only charge X amount? We have a
real crisis here across the board, both in terms of the people
who own the buildings being able to afford them as well as
then, obviously people being able to afford rent.
Ms. Goodridge. Yes, and what I am saying is there are
everyday New Yorkers, aside from one assemblymember, who make
even more than that salary, and they are eligible for
affordable housing, and people who make extremely low income
are not. I think it is very problematic and it needs to be
fixed.
In terms of NYCHA, let me just point out I have actually
sued NYCHA a bunch of times so I----
Mr. Lawler. You are intimately familiar.
Ms. Goodridge [continuing]. am not like the spokesperson
for NYCHA. Again, it needs to be funded. That is the main
issue. It needs to be funded. The residents validly complain
about it being in disrepair, and a lot of that is--there are
other models that have been explored right now about
privatizing it and----
Mr. Lawler. But you think, maybe not privatizing it
completely----
Ms. Goodridge. Right. Right.
Mr. Lawler [continuing]. but do you think that there is a
way to get a public-private partnership that would actually
address the problem? Because I will just tell you, having
served on the Housing Committee in Albany, now on the Housing
Committee down in Washington, I do not think the problems are
just money at NYCHA. I think it is far bigger than that, and
that there needs to be a real overhaul in the way that it is
looked at.
Ms. Goodridge. Certainly there needs to be an overhaul in
the entire housing agency, but money is at the source of a lot
of the issues. Even with amazing management, with the best
person that could be possibly lead NYCHA, at the end of the day
it is still going to have black mold, as a lot of my clients
have. It is still going to have mushrooms growing out. They are
still going to have no heat, no hot water in the dead of
winter, even with an A-plus person running it.
Mr. Lawler. They need to be completely overhauled.
Ms. Goodridge. Right. The source of that is going to be
investing in it, which I just wanted to point out that the
Housing Crisis Response Act is a move in the right direction,
with $150 billion to invest in fair and affordable housing.
Chairman Davidson. Thanks, Mr. Lawler. I recognize myself
for a round of questions. This will be the last round that we
have, so we will each take one more round of questions.
You know, a lot of what we are talking about is math, and I
always enjoyed math as a student. I remember this idea of you
solve an equation and you try to fix as many of the variables
as possible and focus on one of them. A lot of this is dynamic,
so we are trying to solve all of the variables at the same
time.
Into this mix of demand exceeding supply we are adding
extra demand because we have a large influx of new residents,
new people in our country--not citizens, not people that are
legally here, people who are coming into our country illegally.
So Supervisor Kenny, you testified last year about how the
crisis at our southern border is creating burdens for local
communities across the country. Can you talk specifically about
what has transpired between your Orangetown, New York, and New
York City Mayor Eric Adams when the city tried to house
hundreds of undocumented migrants in an Orangetown hotel?
Ms. Kenny. It was 340 single male adults. That was the
number that they were looking to house in a hotel in
Orangetown, which the town took legal action and prevented it.
We are actually still in court in two legal matters, basically
with lawyers being paid by New York City, on that matter.
What we are seeing, still--and it is part of the cause and
effect, I guess--is what we have started to see is homes being
purchased by investors, and we are finding multiple, multiple
families living in there; it is sad because it is not safe. The
town of Clarkstown, which we are in right now, they had 15
homes that had multiple families, most of them migrants, living
in the basement, living in rooms with crockpots, or whatever
they had, or whatever. So they had to get administrative
warrants and go in.
We, in Orangetown, are just starting to see it. We have
identified two or three homes that we are seeing, that we are
getting calls that there are too many people living in a house
and so, it is another issue we have with landlords. A lot of
landlords, whether they are a Blackrock or an individual buying
multiple homes and then sticking as many people in there as
they can. So it is definitely something that the
municipalities----
Chairman Davidson. Kind of at odds with the intent of the
local zoning, right?
Ms. Kenny. Exactly.
Chairman Davidson. Do you think it is a good use of
taxpayer resources to have to spend money to challenge mandates
of these kind of powerful government programs or, frankly, in
the case of some of the Federal policy, actually violations of
Federal law that say that some of these folks shall be
detained, shall be deported, and yet they are being transported
all over the country, showing up in communities and confronting
local governments with challenges like you are facing.
So not only are we spending the resources at the Federal
level, it is causing local governments to spend resources as
well, right?
Ms. Kenny. Yes. Even worse, New York State has given New
York City, I gave up with the number, but two-billion-plus or
whatever, and they are using those dollars to hire lawyers to
sue local municipalities. I think those dollars would be way
better spent to deal with the problem in New York City than
trying to force municipalities, who are not equipped for it. We
do not have housing to defend ourselves.
So it definitely, to me, is almost a slap in the face to
all the taxpayers of Orangetown, that our taxpayers are going
to sue us.
Chairman Davidson. Yes, I think people in Ohio have been
encouraged by seeing the reaction in places like New York, and
even New York City, where people are recognizing, oh wow, this
is not really sustainable. I mean, you are talking about what
would be around the tenth-largest State if all of these new
illegal immigrants into the United States, under the Biden
Administration, were in one place, it would be like the tenth-
largest State. I mean, this is at a scale that is unprecedented
and at a scale that is not sustainable. It is the same kinds of
challenges that we talked about with planning and zoning, and
when you have massive influx of demand--these people need to
live somewhere--it far outpaces what was already a problem,
even without it.
So communities are being confronted with unsustainable
challenges in a lot or ways, as the need for supply of housing
is hard to keep up with the demand. You see great economies.
The job growth is outpacing the ability for housing to be
constructed and into this you drop 10 million extra people.
America already has a planning and zoning system for new
residents. We recognize about a million new citizens legally
every year. It is a fair debate whether we should do it
illegally or not, but I just wanted to highlight the impact on
housing of this extra surge.
So thanks for your prior work on it. Good luck with
resolving your lawsuits with your State, and hopefully we will
have success in turning off the fire hydrant.
We went down to the border. I think all three of us were
down there in January with the Speaker, and we were
highlighting the problem. We did not necessarily need another
trip to the border to highlight the problem. People know that
the border system is broken but one of the folks that we were
talking to was saying, ``We do not need more buckets to catch
more water. We need somebody to turn off the fire hydrant,''
and there is just a massive flow in. So some of the proposals
deal with just spend more money, spend more money, and the
reality is you have got to get to the root cause. In the case
of securing our border, come through the lawful ports of entry,
enter our country legally. That can be done. I hope we do it,
and I think it will have some impact on local communities with
the cost and availability of housing.
With that I would recognize Mr. Flood.
Mr. Flood. Thank you, Mr. Davidson. Mr. Lawler made a good
point about the difference in Rockland County compared to a lot
of other counties in the United States. Your median household
income is $106,000, with an average home price of $609,000,
where the county I live in has an average home price of about
$175,000, and our median income is about $60,000. So everything
is relative.
Supervisor Kenny, that does not mean you do not have
working poor or poverty in Rockland County. Do you have an
issue with dilapidated homes of your existing housing stock in
your town of Orangetown, or can you speak even to the greater
Rockland County area?
Ms. Kenny. I can speak to Orangetown. I mean, Rockland
County, even though we are a small county, we are very distinct
towns. You will find Clarkstown and Orangetown are probably the
most similarly situated.
We do have our fair share of homes that, whether it is a
senior in it that just cannot take care of it or it has been
foreclosed on and it is a zombie home, and then the
municipality, we do have a process in place for property
maintenance and to improve the properties, and things like
that, when it happens.
Fortunately in our town it is not an overwhelming problem.
I think if you move to other communities within Rockland County
you will find that problem.
I just wanted to say I was in Lincoln, Nebraska, and I am
like, how much was that price of a house? I am ready to go.
Mr. Flood. Lincoln's median income is a little higher. Not
that high, though.
Well, one thing I would offer to you--and we run into this
issue too, especially with the silver tsunami coming, with an
older population that are fixed income, on Social Security, or
whatever retirement they have as energy prices rise one of the
things that I have found that is underutilized, and the Federal
Government commits a lot of resources to, is weatherization.
Weatherization programs and the United States Department of
Agriculture (USDA) programs and the other Federal programs that
are available will do anything from putting new siding on a
house, to a new door, to a new heating and air conditioning
system, to doing windows. New windows make a home look like it
is brand new.
I think it is twofold. It helps that maybe senior citizen
on a fixed income lower their monthly energy costs by maybe
$100 or $200, which is real money, but it also improves the
neighborhood, and suddenly, when that house in the neighborhood
looks better, the person owning the worst-looking house starts
to up their game.
I just wondered, there has been a conversation about using
these very underutilized weatherization programs that are
available through all sorts of different Federal agencies.
Ms. Kenny. I would say from the local standpoint we have
not. It is actually the first time I am hearing of it, so there
you go. It is obviously underutilized. We do have a lot of
county and State programs to help with either the heating costs
and more like that, the water, so they keep their essential
services going. I am not aware of any where they help with the
roofs or the windows.
Mr. Flood. Well, one of the best things about multifamily
or even duplex housing is that once we move an elderly--be it a
widow or a widower--out of that home it frees it up for a
family to come in and take advantage of that home so that we
can welcome more families in and still take care of our more
mature population.
You have a unique set of challenges here, and land costs,
wrapping my head around it, I do not know how you provide that
affordable housing without some creativeness.
With that, thank you to everybody. This has been very
informative. Again, thank you for the invitation, Mr. Davidson
and Mr. Lawler, for being here. I yield back.
Chairman Davidson. Thank you. I now recognize Mr. Lawler.
Mr. Lawler. Thank you, Mr. Chairman. I just want to go back
to Mr. Amicucci. You mentioned a few items that you think would
be helpful, the Choice in Affordable Housing Act, expanding the
low-income housing tax credit, incentivize adaptive reuse of
underutilized commercial properties, among other things.
One of the things that I have talked to a number of people
about has to do with opportunity zones, and expanding it to
allow for ordinary income as opposed to only capital gains.
What are your thoughts on that?
Mr. Amicucci. Actually, I am not too familiar with the
opportunity zones around the State, but I think that anything
that you can do----
Mr. Lawler. This was under the Tax Cuts and Jobs Act from
2017. The opportunity zones allow for you to deduct on the
capital gains only.
Mr. Amicucci. Right.
Mr. Lawler. Most people who own multifamily housing, for
instance, are mom and pop. It is the local cop and teacher who
invested in a rental property, whatever the case but they are
mostly on ordinary income. So the question is--and Mr. Ketcham,
maybe you have some thoughts on this as well--would this be
beneficial to allow, as opposed to just capital gains, to allow
for ordinary income to be deducted?
Mr. Amicucci. Well, of course it would be beneficial.
Again, it is like when you have a paper loss on a property that
you own the Federal tax laws do not allow you, only up to
$25,000, to deduct any of those losses against your ordinary
income. Also if you are making over $150,000 a year, which most
people in this area, even just to have some sort of sustenance
have to do, then you do not get any benefit from it and you
just get it as a carryover. There is only $3,000 that you can
deduct, and then you carry it forward for as long as the
lawsuit occurs.
If you can have a deduction against your taxable income for
any ordinary income that you have, I think that would be very
beneficial to the individual homeowners.
Mr. Ketcham. If I may add----
Mr. Lawler. Yes.
Mr. Ketcham [continuing]. I believe that would be a helpful
policy because you would essentially be expanding the capital
available to increase housing supply. It is not that dissimilar
to the tax incentive program formerly known as 421a in New York
State, where the city is foregoing tax revenues on rental
properties, large rental developments, in order that they be
built, because they would not pencil out unless there is some
tax incentive there. Given the property tax structure in New
York City, that disproportionately burdens large rental
developments compared to co-ops, condos, and small homes.
So the question is how are you going to make the most use
of Federal dollars to increase housing supply, and you can do
so through direct subsidy, but you can also take cash streams,
like foregone tax revenues, and roll that into the capital
stock available to build more supply. So in that way I think
that it would prove helpful.
Mr. Lawler. Okay. Mr. Chairman, thank you very much for
hosting today's hearing here in Rockland County, and thank you
to all of our witnesses for participating in it. With that, I
yield back.
Chairman Davidson. Thank you, Mr. Lawler, for drawing us
here to New York. We had plans to do a field hearing, and for
the benefit of the audience Mr. Lawler said, ``Please pick New
York. We have a lot of issues to highlight.'' I want to thank
our witnesses for your testimony today, and frankly, he has
proven accurate. There have been a lot of benefits to coming
out here.
Without objection, all members will have 5 legislative days
within which to submit additional written questions for
witnesses to the chair, which will be forwarded to the
witnesses for their responses. I ask our witnesses to respond
as promptly as able if these are, in fact, sent.
This hearing is now adjourned.
[Whereupon, at 11:35 a.m., the hearing was adjourned.]
A P P E N D I X
February 22, 2023
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