New York State Bill Calls for Publicly Owned Housing

Feb. 18, 2024

Forget Private Developers—Cities And States Could Just Build Their Own Housing To Solve The Crisis.

In New York, now there’s a bill to do it.

The housing crisis in New York is the worst it’s been in over five decades, and low-income residents are being hit the hardest. As a result, homelessness is on the uptick and working-class families are being forced out of the city at an alarming rate. In the midst of this emergency, an array of progressive politicians and organizers are joining in an effort to move away from private sector development as the sole tool to address the severe housing shortage.

In early February, New York State Assemblymember Emily Gallagher and State Sen. Cordell Cleare introduced a bill to create the Social Housing Development Authority. This proposed agency would be tasked with developing permanently affordable, union-built social housing, which would be owned by the public — not private developers. While social housing hasn’t yet caught on in the modern United States, examples of this approach can be found all over the world, and housing activists believe it may be the only way to actually meet tenants’ needs.

Gallagher and Cleare’s bill would establish a state-run Social Housing Development Authority (SHDA) as a public benefit corporation, which would increase the supply of permanently affordable housing in the entire state, both through the construction of new housing and through the acquisition and rehabilitation of existing properties.

Cea Weaver, the Campaign Coordinator of Housing Justice for All, tells In These Times, ​“a public authority has all sorts of powers that you can’t really reach through the private sector: like the ability to issue bonds, to override zoning, and to basically take profit out of the equation and re-invest money back into the authority so that it can expand itself.”

Bill supporters say that the proposed authority would be more efficient than existing housing agencies because it would be responsible for nearly all aspects of the housing process, such as acquiring land and properties, along with dealing with zoning, financing and construction. And because the SHDA won’t be driven by the same profit motive as private developers, the authority would be able to reinvest excess funds back into creating even more housing. As a result, the SHDA’s initial price tag stands at $5 billion — which would be funded by a combination of bonds and state subsidies — an amount that supporters say pales in comparison to losses the state has faced from 421-a, a now-expired and controversial tax exemption for developers.

According to Andrew Schustek, a housing researcher and writer, ​“Brad Lander, our city comptroller, just put out a report that said in 2022 the city missed out on nearly $2 billion — just in a year — on 421-a.” While developers see 421-a as an incentive for residential development, opponents argue that it was the city’s most expensive tax break, from 2007 until its expiration in 2022.

It is no secret that New York is facing an extreme housing crisis. According to the Coalition for the Homeless, homelessness in the city has reached its highest levels since the Great Depression. More than 90,000 people sleep in shelters, including more than 33,000 children. (This number does not include the thousands of people who sleep on the street, in subway stations, or elsewhere.) The Coalition points to a lack of affordable housing as the primary cause of homelessness, which is not news to housing activists who believe that private developers build too much luxury housing, and not enough for those who need it most.

Across the country, the story is much the same: record levels of homelessness and soaring eviction rates, alongside an all-time high of renters who are cost-burdened (those who spend more than 30% of their income on rent and utilities).

At its core, the idea behind social housing is to provide publicly-owned and operated housing for everyone by building more stock, keeping rents low and stabilizing the construction industry to provide a steady rate of new housing. In addition, social housing can benefit both the labor and environmental movements by embracing unionized construction and energy efficiency. And, advocates say, such an approach can help cut against long-standing discriminatory practices in the private housing market.

Sen. Cleare, who represents Harlem, is concerned about gentrification and displacement, and how it has affected the Black community. At the SHDA’s launch earlier this month, she said, ​“As a lifelong resident of Harlem, the Harlem that my parents fought to build through organizing and sweat equity, it has broken my heart to see how the policies of the past not only failed us, but fast-tracked extreme gentrification and the displacement of Black people. Fourth and fifth generation Black households are wondering how much longer they can hold on, and our young people, after they graduate college, do not even bother to try and come home because the rent is too damn high!” Black and Latino New Yorkers are disproportionately affected by homelessness: nearly 60% of homeless shelter residents are Black and 31% are Latino.

When Assemblymember Gallagher went to Vienna in fall 2022 to explore that city’s extensive social housing projects, she was amazed by what she saw. She tells In These Times that being in Vienna ​“made me aware of the extent that housing insecurity controls our society. When I spoke to tenants, [issues like] worrying about where they would live, asking for repairs, thinking about ​‘their next move’ were so much less fraught. They were focused on a life they wanted to live, rather than the life that was allowed at the end of working and paying rent.” In Vienna, 3 in 5 people live in public housing and the municipality itself serves as the largest landlord, maintaining around 800,000 housing units. Sweden and Finland also each host their own large-scale social housing networks.

New York is not a stranger to social housing — the city actually has the most social housing in the country, thanks to major investments made in the 20th century into projects like Co-Op City in the East Bronx.

“My union built and funded Electchester [a complex of 38 buildings in Queens constructed in 1949 by Local 3 of the International Brotherhood of Electrical Workers], social housing for the working class,” says IBEW Local 3 member Gustavo Gordillo.

“It’s where we still have our own union meetings. The green social housing bill [SHDA] is a way for workers to take control of our city and our industry, and build what workers need, not just what the 1% will allow.”

In 2023, the rental vacancy rate in New York stood at just 1.4%. With more renters competing for fewer apartments, landlords have even more power over tenants, with the ability to raise rents and garner other concessions. All of the important players in the housing world — politicians, unions, the real estate industry and tenant activists — are united around a need for more housing. But the sticking point is what kind of housing.

According to Weaver from Housing Justice for All, ​“All of the tools we have now are all about incentivizing the private developers to build. But they don’t have to build. You can incentivize them all they want, but it’s still up to them, and it’s created a crisis in the development of affordable housing. One little change in the market and they’re like, ​‘we’re not interested in this anymore.’”

The NYC Building & Construction Trades Council (BCTC) is frequently politically aligned with the Real Estate Board of New York (REBNY), the city’s real estate trade association. Gary LaBarbera, who leads both the city and state chapters of the BCTC, has called the relationship between the union council and real estate board ​“symbiotic” in the past, as both organizations are focused primarily on building, which creates new work for union members. But while the REBNY has said that Gallagher and Cleare’s social housing bill is based in ​“idealism and ideology,” the Building Trades Council has endorsed it. Kevin Elkins, the Political Director of the NYC District Council of Carpenters (which is a member of the Building Trades Council and has also individually endorsed the legislation), says that New York needs to ​“realign housing policy and housing construction towards the people living in it and the people building it.”

The BCTC’s support of this bill may represent a fissure in a politically important coalition for the private real estate industry. Avi Garelick, a housing researcher and writer, tells In These Times that ​“creating this divide between labor and tenants has been a big part of New York politics for a long time, so this is really troubling from real estate’s perspective.” Current union endorsers besides BCTC and the Carpenters include UAW-Region 9 and the Mason Tenders’ District Council of Greater New York & Long Island. Assemblymember Gallagher says she hears ​“time and time again from unions how rarely 421-a buildings are built with 100% union labor. Because the money to be spent on union wages cuts into the profit for developers, if they can get away with using something cheaper, they often do.”

The proposed bill also represents a chance to build new, energy efficient housing. Gallagher, one of eight democratic socialists serving in Albany, tells In These Times, ​“much of what is holding back our climate goals is a cost versus profit analysis… With green social housing, we can invest state capital in long term solutions like energy efficiency and public renewable energy that lead to all of our benefit.”

New York is not the only state dealing with a housing crisis, which legislators and activists around the country are working creatively to solve. In Montgomery County, Maryland, an affluent suburban area outside of Washington D.C., legislators resolved to increase the affordable housing stock by using public money to create a revolving fund that would finance the building of nearly 9,000 new units. It’s a relatively new plan, passed by the Montgomery County Council in 2021, but so far it appears to be working: the first publicly-funded project opened in April 2023, and is 97% rented. And last February, voters in Seattle approved an initiative to create the Seattle Social Housing Developer, a public development authority to create social housing in the city.

Of course, plans for the New York State Social Housing Development Authority are much grander, as it would encompass the entire state, not just one county or one city. Organizers, activists, and legislators know this is an uphill battle, and may take years to realize, but Elkins from the Carpenters union says it’s ​“a fight worth having.” The bill currently has 11 sponsors in the Assembly and 5 in the Senate, and supporters are unsure whether Gov. Hochul would sign it even if it made it to her desk. But, Weaver believes, ​“where there’s a will, there’s a way.”

[Top photo: The Brooklyn Basin development. Jane Tyska/Digital First Media via Getty Images.]