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February 28, 2008
The Brooklyn Paper examines Atlantic Yards affordable housing house of cards
Fed cash crunch threatens ‘affordable’ A’Yards homes
By Dana Rubinstein
Thousands of affordable housing units — including some of the 2,250 rentals that Bruce Ratner promised to included in his Atlantic Yards mega-development — will not be built due to a huge shortfall in federal subsidies available for low-cost housing creation, The Brooklyn Paper has learned.
It would take between $6 and $7 billion in federal grants to build all the proposed affordable units in all of the pending projects in the state — roughly five times more money than is available, according to Mike Slattery, the senior vice president at the Real Estate Board of New York.
Indeed, in 2007, the feds only granted $1.6 billion in such bonds — and those numbers won’t change significantly in 2008.
“There’s a lot more demand for affordable housing projects these days and there’s not enough money available,” said Joe Chan, the president of the Downtown Brooklyn Partnership, the quasi-governmental group that oversees the redevelopment of the long-languishing area bounded by Tillary, Fulton and Jay streets and Flatbush Avenue Extension.
“We’re at risk of seeing less affordable housing than” originally planned, he continued.
Bonds bombshell killing projects
"The Explainer" rehashes the issue in Q&A form, but gets one thing wrong:
Didn’t Ratner promise 2,250 affordable units at Atlantic Yards?
Yes.What will happen to the units if the bonds aren’t there?
Some of them won’t get built.Can Bruce Ratner really back away from that promise? Yes, if he writes a $500,000 check — a small amount for his $3.6 billion company — to the housing group, ACORN, which signed Ratner’s Community Benefits Agreement in 2005.
In the "discussion" section Norman Oder points readers to one of his Atlantic Yards Report articles which explains that the $500,000 penalty would be for unfulfilled jobs promises, not for breaking affordable-housing targets.
In the weekly editorial, The Brooklyn Paper states:
It is becoming increasingly clear that developer Bruce Ratner will not be able to build much of the below-market-rate housing that he’s promised to include in Atlantic Yards.
...
The affordable housing units at Atlantic Yards remain the project’s principal carrot in the face of widespread community opposition and egregious misuse of public subsidies to a multi-billion-dollar company.But there’s a problem with Ratner’s promised units: If he can’t get the tax subsidies from the state, he can walk away from the deal simply by cutting a check for $500,000 — which represents a tiny .014 percent of the company’s $3.6-billion total value — to one of the signatories of his “Community Benefits Agreement.”
Then again, he could also call his enablers in state government and complain of the shortfall in subsidies. Perhaps they will do what they’ve always done — repeatedly at Metrotech and at Atlantic Terminal Mall — and lavish more taxpayer money on another of Ratner’s white elephants.
Posted by lumi at February 28, 2008 5:22 AM