NYCCLI Testimony before NYC Council Committee on Housing and Buildings, regarding CLT regulatory agreements

[Download pdf + attachments]

Delivered by Deyanira Del Rio on 10/19/2017

Good morning, and thank you, Committee Chair Williams and the other members of the Committee, for the opportunity to testify about Intro 1269. My name is Deyanira Del Rio, and I am a board member of the New York City Community Land Initiative (NYCCLI), an alliance of community, base-building, affordable housing, and economic justice groups, as well as longstanding and emerging community land trusts (CLTs) across NYC. Our alliance advocates for CLTs as a mechanism to support the creation and preservation of deeply and permanently affordable, community-controlled housing and other critical community needs. For more than five years, we have engaged in extensive coalition and community organizing, community education and outreach, research and policy advocacy to build a movement for CLTs in New York. We are thrilled to see growing support for CLTs in the NYC Council.

NYCCLI thanks Council Member Richards, chief sponsor of Intro 1269, for his leadership and support of CLTs. We outline below important changes to the bill that are needed before it moves forward.

We also are pleased to highlight in our testimony the rapidly-expanding landscape of CLTs in our city and additional policy recommendations by our alliance. We understand that Intro 1269 is a first step toward strong local policymaking to advance CLTs, and we look forward to continued dialogue with the Council.

CLTs provide a flexible, widely-recognized and progressive model for land and housing development. CLTs are nonprofit, tax-exempt corporations that own and steward land for the public good. CLTs lease use of the land for affordable housing development and other community needs — typically through 99-year renewable leases that the CLT enforces and that establish affordability, resale and other restrictions. By separating ownership of land from what is built on top, CLTs curb speculation, lower costs of housing and other development, and create mechanisms for long-term community engagement and oversight. At the same time, CLTs prevent extraction of critical public subsidies and ultimately help preserve the city’s vital affordable housing stock. For all of these reasons, NYCCLI has for years called on NYC to embrace and incorporate CLTs into the City’s housing and economic development framework, to address the unprecedented housing crisis and create a more equitable city.

Indeed, in recent years CLTs have taken root in low income neighborhoods and communities of color across NYC. Groups are pursuing CLTs in East Harlem, the South and Northwest Bronx, Inwood, Cypress Hills, Brownsville and beyond, as a strategy to remove land and housing from the speculative market; foster community decision-making over neighborhood development; and create and sustain deeply and permanently affordable housing, commercial and community space and other critical needs. These gains reflect major grassroots investment in the CLT model.

This year, NYCCLI celebrated a major victory when HPD announced that it was channeling $1.65 million to local CLTs. The funds, which were earmarked for CLTs in a NYS Attorney General bank settlement, will support two newly-established CLTs — the East Harlem/El Barrio CLT and Interboro CLT — as well as the long-standing Cooper Square CLT on Manhattan’s Lower East Side. NYCCLI is also receiving support to lead a two-year “Learning Exchange” to build capacity at nine community-based organizations to organize, steward and sustain CLTs.

The community land trust model has sparked a citywide movement, with the potential to shift our relationship as a city to housing and neighborhoods. As the number of CLTs in NYC grows, their viability and effectiveness will require concerted policy and programmatic support by NYC agencies and officials. NYCCLI was pleased to see CLTs included in the Progressive Caucus’s 18 Policy Priorities for 2018, and to see HPD showing support for the model. We are eager to build on this growing momentum and to work with the Council to support legislation that can facilitate the formation of a strong and sustainable CLT landscape, to ensure accountable housing and community development.

Concerns and recommendations with respect to Intro 1269

NYCCLI urges the City Council to amend and improve Intro 1269, to ensure that it supports CLTs that are community-led and working to reach deeper housing affordability, particularly for very- and extremely-low income New Yorkers who are underserved by both the private market and the administration’s housing plan.

Intro 1269 would explicitly define and permit HPD to enter into regulatory agreements with CLTs. NYCCLI supports these aims. We are concerned, however, that the bill currently defines CLT too broadly – omitting, for example, key governance and community representation requirements that are fundamental to CLTs.

We also are concerned that the bill, in its current form, could inadvertently result in weaker affordability standards for housing on CLTs than provided for in HPD’s existing regulatory agreements with, for example, Housing Development Fund Corporations (HDFCs).

To address the above concerns, NYCCLI urges the City Council to:

• Amend the definition of a “community land trust” to reflect the unique stewardship and governance structure of a CLT. The bill should establish obligations with respect to representation of leaseholders in the CLT board structure — a fundamental aspect of CLTs, and one that is critical to ensuring community control and stewardship. This is glaringly absent in the bill’s current definition of a community land trust. Expanding the definition in this way would additionally align the City’s definition with federal definitions of CLTs. Attached to our testimony, please find a proposed definition, which NYCCLI developed as part of our model CLT enabling bill.
• Incentivize deeper housing affordability. The bill currently defines qualifying households as those earning up to 165% area median income (AMI). While we understand that HPD’s range of affordability reaches up to 165% AMI, the degree of benefit conveyed by any regulatory agreement should be directly tied to depth of affordability. The Article XI tax exemption currently available to HDFCs (including CLTs incorporated as HDFCs or HDFCs leasing CLT-owned land) is a living model of how such a program can be structured. Any new regulatory agreements established with CLTs should reflect – or strengthen – existing regulatory requirements, such as those provided by Article XI.

NYCCLI is excited to work with the Council on what we believe is one of the most promising innovations in New York City’s housing landscape. Our alliance has developed a number of policy recommendations to advance and sustain CLTs in New York, which I am attaching here.

We look forward to continued dialogue and partnership to expand the CLT model and its benefits for New Yorkers and their neighborhoods.