Volume 74, Number 30 | December 01 - 07, 2004

HUD gives Guild Houses tenants some reassurance

By Albert Amateau

More than 200 anxious tenants of the Grand St. Guild Houses, worried about losing the federal subsidy that keeps their rent affordable, turned up at a Nov. 18 meeting arranged by Congressmember Nydia Velazquez with a federal housing official.

The tenants left the two-hour meeting reassured that their Section 8 subsidy was safe for a while but they were determined to organize a stronger tenants association to keep rents affordable far into the future and to get repairs for their 30-year-old buildings.
“I know there’s a lot of concern about the Grand St. Guild properties,” said John Laffen, a U.S. Department of Housing and Urban Development official. “I want to give you some sense of calm about what’s in store for your Section 8 contract — and give you some hope,” he added.

Most New York City developments built under the Mitchell-Lama and Section 8 programs 30 years ago and earlier have the option of leaving those programs and raising rents to market rate.

But because the developer of the three Grand St. Guild Houses at 131 Broome St. and at 410 and 460 Grand St., with 200 apartments each, is a nonprofit housing company, the rents must be maintained as affordable for 40 years, Laffen said. “So there’s still 10 years left,” he added. The current Grand St. Guild Section 8 contract is in effect through next year, he added.

Guild Houses trustees have indicated that they don’t intend to quit the Section 8 program, Laffen said, but they are concerned about getting federal financing for capital improvements for buildings that are deteriorating after 30 years. St. Augustine’s Episcopal Church on Madison St. organized the nonprofit housing group 30 years ago and the church still has representatives on the boards of trustees of each of the three buildings.

The federal Section 8 program has been threatened in the past two years by the Bush administration’s move to reduce or eliminate housing subsidies. Andrew Cuomo, former HUD secretary in the Clinton administration, said at a Nov. 15 news conference in Battery Park City that there is no longer any talk of building new affordable housing projects like Section 8. “The entire fight in Washington is to keep what we have,” Cuomo said.

The Nov. 18 meeting, conducted by Melissa Maldonado, an aide to Velazquez, and Alexander Gonzalez, a tenant leader in Grand St. Guild Houses, also included Solomon Turkel, a staff member of City Councilmember Alan J. Gerson, who outlined Gerson’s Intro 186, Tenant Empowerment Act, a bill that would give residents in projects with Section 8, Mitchell Lama and similar contracts the right of first refusal to buy their buildings if owners elected to leave the programs.

Grand St. Guild residents gave rousing ovations to tenant organizers with GOLES (Good Old Lower East Side) who urged them to create a strong association. In a prepared statement, Congressmember Velazquez also urged Grand St. Guild tenants to organize with GOLES’ help.

“As the only member of the New York City delegation to serve on the Housing Subcommittee, working to protect the Section 8 program has been one of my top priorities,” Velazquez said in the statement. “With your help, I fought hard in Washington to restore $1.6 billion in proposed cuts to the Section 8 program and we need to do all we can to ensure that that landlords in New York City stick with the program and continue to provide this irreplaceable source of affordable units.”

Alice Cancel, Democratic district leader and an aide to State Senator Martin Connor, also pledged support for Grand St. Guild tenants.

Several landlords of federally subsidized Mitchell-Lama housing, like the owner of Independence Plaza North in Tribeca, have agreed to keep rents affordable for existing tenants through a combination of federal vouchers and city programs.

The owner of West Village Houses, who decided to quit the Mitchell-Lama program, agreed in the summer to allow tenants to buy the property at below market price. The West Village Houses agreement, which involves tax breaks and other aid granted by the city, allows residents to form a limited-equity co-op that would keep housing costs affordable for all the residents. Gerson contends his Tenant Empowerment Act would give residents of other subsidized projects the same chance to own their buildings that West Village Houses tenants have.

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