The FY 2018-2019 budget, due October 1, 2018 was signed into law on February 15, 2019. Congress provided an additional $1 billion to the HUD budget over FY 2018, a total appropriation of $53.8 billion. The McKinney–Vento Homeless Assistance grant program grew by 5% to $2.6 billion, higher than any earlier proposal from the House or Senate. The bill provides enough resources to renew all Housing Choice and Project Based Rental Assistance Vouchers, while rejecting harmful work requirements and changes to rent rules that would raise costs for tenants.
Other HUD programs that the Network advocates for received slight decreases, including Section 202, Section 811 and HOME. No existing units will be lost due to these cuts. On a brighter note, HOPWA (Housing Opportunities for People With AIDS) received an $18 million increase and an additional $40 million was appropriated for new VASH (Veterans Affairs Supportive Housing) vouchers. Funding for the United States Interagency Council on Homelessness (USICH) was included along with authorizing legislation until 2028.
Congress should begin working on the FY 2019-2020 budget immediately, and must again lift the budget caps to avoid another round of across the board cuts resulting from the Budget Control Act. Lifting of those caps was essential to gaining funding increases over the past two years.
Please plan on joining the Network at the National Alliance to End Homelessness lobby day in Washington D.C. on July 24th!
On January 24th, Laura Mascuch provided testimony to the New York State Senate and Assembly at the SFY 2019-20 Joint Legislative Public Hearing on the Executive Budget’s proposal on human services. She emphasized the importance of both the Homeless Housing Assistance Program (HHAP) and the New York State Supportive Housing Program (NYSSHP) and the need to increase funding for both programs in this year’s final budget.
The hearing was led by Committee Chair’s Senator Liz Krueger and Assembly Member Helene Weinstein, and were joined by several of their fellow Senate and Assembly members including Human Services Chairs, Assemblyman Andrew Hevesi and Senator Roxanne Persaud. OTDA’s Executive Deputy Commissioner, Barbara Guinn also testified about the OTDA budget and many times discussed the critical role supportive housing plays in addressing homelessness in New York State.
You can read the Network’s testimony here.|
On January 15th, Governor Cuomo released the SFY 2020 Executive Budget.
Here is our first analysis of the various budget areas important to the supportive housing community. We will update you as more information becomes available.
FIVE YEAR HOUSING & HOMELESSNESS PLAN
Included in the executive budget is a re-appropriation of the state’s $2.5 billion five year housing and homelessness plan that includes funding for 6,000 units of supportive housing over five years. This specifically includes $950 million in capital funding and $124.5 million for service and operating expenses for the first 6,000 units over the next five years.
OFFICE OF TEMPORARY AND DISABILITY ASSISTANCE
- Homeless Housing Assistance Program (HHAP) - $64 million - no increase from last year's budget. HHAP, OTDA's homeless housing capital program, continues to be significantly underfunded. This will an advocacy priority for the Network this year.
- Homeless Housing Prevention Services Program - $39.8 million - $3 million INCREASE - HHPS funds the New York State Supportive Housing Program (NYSSHP), the Solutions to End Homelessness Program (STEHP) and the Operational Support for AIDS Housing (OSAH) Program.
HOMES & COMMUNITY RENEWAL
- Housing Trust Fund - $44.2 million - no increase from last year’s budget.
OFFICE OF MENTAL HEALTH
- OMH Supportive Housing – $10 million INCREASE for existing supported housing and single residence occupancy programs. This is significantly less than what is needed to maintain the existing units and will be an advocacy priority for the Network this year.
- OMH Preservation Capital - $60 million. The Budget includes $60 million to maintain and preserve community-based residential facilities that allow people with mental illness to live in the most integrated setting possible.
- Workforce Increase The Budget includes no cost of living adjustment.
DEPARTMENT OF HEALTH/MEDICAID REDESIGN TEAM (MRT)
- MRT Supportive Housing Fund - $98 million over 2 years - This includes full funding for the MRT Supportive Housing Program.
- Federal Medicaid Waiver - As a part of this year's budget initiatives, the State will apply for a waiver to leverage Federal funding for certain supportive housing services currently funded with State-only dollars including: 1) housing transition services; 2) tenancy support services; and 3) housing-related collaborative activities. The Network will be analyzing this initiative.
In addition to these budget items, the Governor highlighted in his State of the State address that reforming the state’s rent regulation laws should take a top priority this year. He specifically mentioned eliminating vacancy decontrol, ending preferential rent limits, limiting building apartment improvement charges and strengthening the tenant protection unit “so we actually enforce those laws.”
He also mentioned that all construction projects with public subsidies should be subject to prevailing wage.
We are awaiting more details on these two issues and how they might impact existing supportive housing units as well as future projects and will let you know when we have more information.
The budget now must be passed by the Legislature and signed by the Governor no later than April 1st. In the next few weeks, the Senate and the Assembly will hold budget hearings and negotiate with the Governor. The Network’s advocacy in the upcoming weeks will focus on the proposed initiatives outlined above.
We are currently planning a March 5th Advocacy Day. We encourage all Network members to participate. More information to follow.
Every year, Borough Presidents and City Council Members provide capital funding to nonprofits, schools, and other organizations for projects throughout each borough. This discretionary capital funding (formerly known as Reso A) is valuable subsidy for supportive and affordable housing development projects in NYC. This funding can be helpful to fill a gap in a development budget.
Starting now, nonprofits can apply for grants through the CapGrants portal or applications listed on Elected Officials’ websites. Awards are typically announced in the summer. To receive funding, applicants should schedule a meeting with the representative before submitting the application to discuss the project details. Below are the typical deadlines, though some elected officials have additional requirements and deadlines:
Borough President Requests: February 20th
City Council Requests: March 26th
Specific information for representatives can be found here:
Brooklyn Borough President: To apply to the Brooklyn Borough President’s Office for capital funding for Fiscal Year 2020, organizations must fill out an application by 11:59 pm on Wednesday, February 13, 2019. In addition, organizations should complete the CapGrants portal application by 5 pm on February 20, 2019.
Bronx Borough President: The office is currently accepting Letters of Intent for Fiscal Year 2020 and orgnaizations should send a letter as soon as possible. Organizations must apply by 5 pm on Wednesday, February 20, 2019.
Queens Borough President: Organizations are encouraged to apply as soon as possible. Organizations must apply by 5 pm on Wednesday, February 20, 2019.
Staten Island Borough President: All requests for capital funding from the Staten Island Borough President must be submitted via mail or email. Applications also should be submitted with a cover letter. The deadline to submit the SI BP’s online capital funding application is Friday, February 10th, 2019. Organizations must also apply through CapGrants by 5 pm on Wednesday, February 20, 2019.
City Council Members: Apply through the CapGrants portal by March 26, 2019.| What's New, Funding, New York City
On November 19th, the Network submitted comments on the Community Reinvestment Act (CRA) regulations, in response to an Advanced Notice of Proposed Rulemaking (ANPR) issued by the Office of the Comptroller of the Currency (OCC), one of three federal entities that oversees the program. The CRA was passed in 1977 as a response to redlining, the discriminatory practice of denying investment and mortgage financing opportunities to communities of color. According to the statute, banks are required to meet the credit and deposit needs of the “communities in which they are chartered,” including low- and moderate-income (LMI) neighborhoods. Banks receive a rating based on qualitative and quantitative data in three areas: lending, services, and investment.
The Network’s comments focused on ensuring that the CRA will continue to be an incentive to banks to dedicate resources to supportive housing residences and nonprofit organizations as part of a larger community development strategy. The CRA has historically channeled investment to mission-driven nonprofits and their affordable and supportive housing projects through the Low Income Housing Tax Credit (LIHTC) program, as well as through loans and relationships with local nonprofits.
The Network’s comments focused on the following areas:
Maintaining the three part exam structure – lending, services, and investments – as opposed to the proposed “one-ratio” approach that overly simplifies performance and may detract from critical LIHTC investment
Maintaining a focus on affordable housing and community development
Emphasizing loans, services, and investments that support organizations with a mission of community or economic development, and with proven track records
Encouraging a local focus without drawing arbitrary boundaries of banks’ service, investment, and lending areas, ensuring proper attention is paid to New York’s dual housing and homelessness crises
Some 60 friends, funders, tenants and partners gathered on a crisp December morning to celebrate the opening of The Maple Residence- a 66 unit supportive/affordable building in the Crown Heights neighborhood of Brooklyn. Developed by The Bridge, Maple will bring 50 units of supportive housing to vulnerable New Yorkers suffering from mental illnesses, and 16 units of affordable housing to low-income families in the community.
The President of The Bridge’s Board of Directors, Cynthia C. Wainwright, began the program by welcoming and thanking everyone in the room for their support. Susan Wiviott, The Bridge CEO, spoke next, thanking all the partners and staff members that made this project possible.
“It takes a million and half people to get this done and we really have great partners to get this done with,” said Susan.
The rest of the speaking program included remarks from Brett Hebner, Director of Housing Development and Support at the NYS Office of Mental Health (OMH); Blanca Ramirez, Vice President of Acquisition/Underwriting at Hudson Housing Capital; Jennifer Trepinski, Director of Loan Originations at CSH; and last but not the least, a tenant of the building, Nancy C.
“On behalf of Dr. Anne Sullivan I’m delighted to be here and congratulations to The Bridge on its most recent beautiful building,” he remarked to the audience.
Blanca Ramirez also recognized The Bridge for its commitment to provide housing to those that need it most.
“Every building has a story and we were very excited to work with The Bridge to get this beautiful building put together,” said Blanca.
“The walk here was really amazing and it was great spotting the building in this corner. CSH is so proud to support The Bridge and get this project started,” said Jennifer Trepinski from CSH.
The star of the show was Nancy C., a tenant of the Maple East NY Residence. She spoke of her journey from being hospitalized for mental illness to becoming a graduate student at CUNY.
“A few years ago I was hospitalized for mental illness for nine months and after that I was in a shelter briefly, and then was taken in by The Bridge. They gave me all the tools to get my life back together. I’m extremely grateful to have been selected to live at Maple, a beautiful building,” she told the audience.
The Maple/East NY Residence is powered by solar panels on its roof and features a community kitchen, computer lab, and an outdoor community patio for its tenants. Comprehensive social services are funded by OMH. The building was designed by Edelman Sultan Knox Wood Architects and was constructed by DP Group General Contractors.
Capital financing for the Maple Residence was provided by OMH and bonds from the Dormitory Authority of New York and Low Income Housing Tax Credits syndicated by Hudson Housing Capital with HSBC as investor. CSH provided the pre-development loan that included acquisition funding.| What's New, New York City
Building on years of joint venture research and events, the Network hosted its first ever hands-on workshop on negotiating joint venture partnerships in supportive housing development. The event was hosted by Capitol One and facilitated by Network and Enterprise Community Partners staff members. CEOs and development professionals from 18 nonprofit organizations in New York City, as well as development partners from Bronx Pro and CSD Housing attended the morning workshop.
The workshop focused on nonprofit developers working through a mock negotiation in small groups to create a joint venture (JV) agreement. Each group was given a case study detailing a hypothetical supportive housing development project of a nonprofit and for-profit developer and was asked to create a term sheet for the deal that leveraged the strength of both the nonprofit and for-profit developers.
“For me this was JV 101 and therefore very useful in helping me understand basic concepts and roles,” said one of the nonprofit participants.
Another attendee said, “This helped me get a better understanding of Joint Ventures from all points of view- corporate and nonprofit.”
Joint ventures are becoming an increasingly common strategy to leverage the strengths of nonprofit and for-profit partners for supportive housing development. These partnerships can be extremely beneficial for all involved, but also can be intimidating and difficult to navigate for nonprofits with all levels of JV experience. To equip our members with the right tools and knowledge, the Network developed a Joint Venture Guidebook in partnership with Enterprise Community Partners that includes case studies and analysis of JV deals that have been negotiated in the past.
Are you interested in joint ventures? Check out our guidebook and contact Rebecca Sauer, Director of Policy and Planning for questions and more information.| Network Events
On November 29th, Governor Cuomo announced the winners for the first phase of the Vital Brooklyn RFP. The Network congratulates the winners, including Network members Services for the UnderServed (SUS), RiseBoro, CAMBA, Federation of Organizations, Apex Building Company, and MDG Design + Construction.
Vital Brooklyn, launched in spring of 2017, is New York State’s comprehensive community development initiative that addresses chronic social, economic, and health disparities in Central Brooklyn, one of the most underserved areas in the State.
Winners of the First Four Sites
The former Brooklyn Developmental Center will be redeveloped by a team comprised of Apex Building Company, L+M Development Partners, RiseBoro Community Partnership and SUS, representing a $1.2 billion investment in East New York. The development will provide more than 2,400 units of affordable housing, including:
45 percent of units available to households earning up to 50 percent of Area Median Income (AMI)
Approximately 207 units for formerly homeless individuals and families
Approximately 185 units for intellectually and developmentally disabled individuals
Approximately 156 units for seniors
None of the units will be available to households earning more than 80 percent of AMI
"Interfaith Broadway: Site C" will be redeveloped by CAMBA. CAMBA will transform Site C, on grounds owned by One Brooklyn Health, creating 57 apartments affordable to a variety of income levels, and on-site services for seniors and chronically homeless families.
"Brookdale Hospital: Site B" will be redeveloped by a joint venture between MDG Design + Construction, Smith & Henzy Advisory Group, and the Foundling Group. The new development will create 152 apartments affordable to a variety of income levels, and on-site services for the developmentally disabled and individuals aging out of foster care.
"Interfaith Herkimer: Site A" will be redeveloped by Federation of Organizations. The new development will create 119 affordable homes on a 21,000 square foot lot across the street from Interfaith Medical Center.
On November 29th, HCR also released the second phase of its Vital Brooklyn RFP, due February 28th (Sites E, F, G, H & I) and April 30th, 2019 (Site J, K & L). Through this RFP, HCR seeks to develop eight high-quality, sustainable, and mixed-use permanently affordable housing developments in Brooklyn. Affordable housing may include multi-family, senior, and/or supportive housing.
If you are interested in responding to the RFP to create supportive housing and are looking for development partners, please contact the Network and we will do our best to make introductions.
View the RFP on the HCR website here.| Funding, New York State
On November 15, The Network testified at the New York City Council Committee on Contracts hearing regarding a new bill that targets late contract payments to nonprofits that are delivering services to the city’s most vulnerable, including many that are operating supportive housing throughout the City.
The proposed bill, which would require the Procurement Policy Board to create a process for city agencies to inform vendors of the reason for any late payments, was introduced by Committee Chair Justin L. Brannan and Council Member Rory Lancman. It would also require City agencies to provide the Mayor’s Office of Contract Services with reports on any such late payment. The Mayor’s Office of Contract Services would then provide a report to the Mayor and Council every six months with information about the late payments from all City agencies. Council members present at the hearing included Inez D. Barron, Bill Perkins, Helen K. Rosenthal and Kalman Yeger.
For a payment to be made on a City contract with a nonprofit, the contract must be registered, a process that includes review from many City agencies and offices, including that which will hold the contract, the Mayor’s Offices of Contract Services (MOCS) and the Comptroller. In addition to the issue of late contract payments, many who testified at the hearing brought up the issue of slow contract registration as a root cause.
The Network’s Director of Policy and Planning, Rebecca Sauer, testified on behalf of the Network’s members that are impacted by late contract registration and payments.
“We hear serious concerns from nonprofit members who have millions of dollars of outstanding receivables on their books and fiscally unhealthy reliance on lines of credit due to late contract registration and delayed payments. Outstanding receivables can lead to audit findings. Nonprofits can spend tens or hundreds of thousands of dollars on interest on lines of credit, which is not reimbursable. The negative financial impact left by late payments can make nonprofits appear to be a risky investment partner or borrower, hindering their ability to access the financing required to develop permanent supportive housing. In their fiduciary capacity, nonprofit boards of directors are also increasingly and understandably reluctant to approve new real estate development while their organizations are supporting structural deficits and bridging late payments from existing human service contracts,” she stated to the committee.
The Network thanks the Human Services Council (HSC), who has been leading the charge on efforts to reform procurement and contracting processes that affect nonprofits. Testimonies were also provided by BronxWorks, United Neighborhood Houses, LiveOn NY and many others who emphasized to the committee the human and financial toll of late registration and payments. We look forward to continuing to advocate with our partners for improvements to these administrative processes.
The Supportive Housing Network of New York is proud to be partnered with a coalition of housing advocates, for-profit and non-profit developers, tenant advocates and labor union stakeholders to urge lawmakers for revisions of New York’s rent laws during the 2019 state legislative session.
The current regulations are set to expire on June 15, 2019 and will impact 2.5 million New Yorkers living in rent-stabilized housing. The coalition includes Enterprise Community Partners, Legal Aid Society, New York State Association for Affordable Housing (NYSAFAH), New York Housing Conference, Community Service Society, AARP New York, Association for Neighborhood & Housing Development, DC37, Coalition for the Homeless, VOCAL-NY, Center for NYC Neighborhoods, LISC NYC, Corporation for Supportive Housing (CSH), LeadingAge New York, LiveOn NY, Housing Rights Initiative and Neighborhood Preservation Coalition of New York State and the Network.
The coalition is calling on state leaders to enact the following reforms to New York’s rent laws during the 2019 legislative session:
End High-Rent Vacancy Decontrol
This pathway toward deregulation, which has only been a feature of rent regulation since 1994, has encouraged the use of both lawful and unlawful means to increase rents past the deregulation threshold of $2,733 per month. These means frequently entail harassment and fraud and have resulted in displacement of long-term tenants from their homes. This year, the rent laws must be restored to their original promise by ending deregulation.
Restore Preferential Rent Protection
The State should return the rent laws to their pre-2003 form and no longer permit landlords to revoke a preferential rent upon lease renewal. Tenants with preferential rents must no longer fear the loss of their homes due to rent increases beyond those allowed under Rent Guidelines Board (RGB) rules.
Reform the Vacancy Allowance, Major Capital Improvements (MCI), and Individual Apartment Improvements (IAI)
The State should reform the provisions governing the Vacancy Allowance and Major Capital Improvement and Individual Apartment Improvement increases in a way that reduces excessive rent hikes but ensures that owners can provide safe and decent housing. Taken together, these provisions produce an exponential impact on regulated rents, creating significant financial incentives for tenant turnover, resulting in displacement.
“The Supportive Housing Network wholeheartedly endorses this coalition’s recommendations regarding reforming the City’s rent regulations,” said Laura Mascuch of the Supportive Housing Network of New York. “The unprecedented loss of truly affordable housing over the last twenty years has led to unprecedented levels of homelessness in New York City – more than 60,000 New Yorkers are homeless right now. We look to the newly constituted legislature to address this pressing issue as its first order of business.”