CM Riley questions HPD on bond cap, project manager delays, and HDFC expirations
Riley asks whether HPD has sufficient bond cap for ambitious production goals. Levy cites the 25% test change and significant capital commitments. Riley then raises delays in HPD project manager assignment for HDFCs aging out of regulatory agreements. Levy discusses the expiring DAMP tax cap affecting ~1,000 HDFC co-ops and ~250 under HPD regulatory agreement, offering to follow up on specific sticking points.
Thank you, Chair.
So good morning to Commissioner Tajani, Commissioner Levy, and Director Weaver and your team.
Thank you so much for testifying with us here today.
Just a few questions.
So we often hear from different stakeholders about the lack of funding in HPD's budget that leads to delays in receiving subsidies during HPD's June and December closing windows.
With an ambitious housing plan being set by this administration to develop hundreds of thousands of housing units, which the council believe is needed as well, included heavily subsidized affordable housing unit.
Does HPD have the bond cap necessary to achieve this goal?
Sorry.
As you know, I think it was last year, maybe two years ago, right, there was a major significant change to the tax credit program.
It's called the 25% test.
So the test was lowered from 50% to 25%.
That became a hugely important tool for us in terms of extending the capacity to finance both 4% and 9% deals.
So that has been hugely helpful.
And then the commitment that was made in terms of capital, which we use along.
side, the 4% and the 9% for the next two years, as you know, is a huge amount of resources that will make sure we don't leave any of that bond cap on the table.
Thank you, Commissioner.
Furthermore, before projects even get off the ground, we are hearing that some of the same stakeholders about delays and being assigned the HPD project manager, particularly amongst those for the HDFCs who are aging out of their regulatory agreement.
And are seeking a new Article 11.
Given these delays and the target of developing upwards to 700,000 units of housing within the next 10-year span, does HPD have the necessary headcount to handle these proposals?
Yeah, I'd actually love to follow up with you more about exactly what portion of which HDFCs you're talking about.
There are two things happening right now.
One is the expiration of the damp tax cap.
So there are about 1,000 HDFC co-ops in the city that benefit from the tax cap, and we know that it's expiring.
And so we are certainly having conversations with our...
You know, partners in the state about the need to renew that, that damn tax cap, which is critical to the affordability of these HDFCs.
There's then another about 250 HDFC co-ops that are actually under regulatory agreement with HPD.
So if there are issues there in terms of, you know, those that are going to the end of their article 11, or they need to renew that, or they just need a capital loan,
I would love to talk with you more about where there is sticking points.