MITCHELL-LAMA RESIDENTS COALITION

Vol. 18, Issue 4 WEBSITE: www.mitchell-lama.org December 2013 Alicia Glen, formerly at Goldman Sachs, HPD seeks to change to head housing & development efforts M-L succession rules

an a former banker, especially one He also wants to use one billion dollars roposed changes to succession rights in who worked at Goldman Sachs, from the city’s pension funds to preserve Mitchell-Lama buildings would alter the Chelp generate affordable housing 11,000 units, and to raise taxes on vacant Pability of various categories of relatives for New York City? property. to assume the apartments of the current resi- Mayor Bill de Blasio thinks so, In her work at the bank, Ms. Glen dents, regardless of how long the relatives have which is why he appointed Alicia Glen, directed more than $2.8 billion to projects lived there in most cases. who for over a decade -lead the giant in low-income areas. She has been praised Among other changes, the new rules, if bank’s Urban Investment Group--and by both tenant advocates and housing adopted, would eliminate “succession rights for who also served as assistant commis- developers. nephews, nieces, aunts and uncles,” and suc- sioner for housing finance at HPD--as cession in other cases will only be authorized deputy mayor for housing and urban “where the tenant/cooperator of record has development. Nearly 1,000 affordable units either died or been relocated to a long term In a press release, Ms. Glen said slated for Melrose section in care facility.” the new administration’s goals included Further, regarding spouses and children building “a new generation of afford- Bronx who are at least 18 years old, succession will able housing and help[ing] New Yorkers ive new buildings containing 985 units only be allowed if the spouse’s or children’s secure good-paying jobs that can support Fof affordable housing are on the draw- names “appeared on the applicant’s initial a family. . . .” ing board for the Melrose section of the application.” The City’s Housing Preservation “We can’t remain the greatest city Bronx. and Development agency released the pro- in the world when half of New Yorkers The complex will also include a wide posed changes prior to a hearing it held on are living in or near poverty,” she said in variety of amenities, such as a new YMCA November 6. a statement. and a recording studio. Under current rules, succession is De Blasio reportedly plans to Residents eligible for the units must granted to residents who can demonstrate create 200,000 units over ten years, in earn between thirty and one hundred per- either a financial or emotional interdepen- part by requiring developers to include cent of the area’s median income. dence with the applicant of record, so long as affordable apartments when building The development is expected to cost they have lived there for the past two years. residential projects in rezoned areas. around $345 million. This applies as well to spouses or partners in same-sex relationships. According to HPD, current succession rules have allowed some people to sign leases, Strengthen MLRC live elsewhere, and then hand the apartments Join today (use form on page 2) Continued on page 8

GENERAL MEMBERSHIP MEETING SATURDAY, January 25, 2014

Time: 10:00 a.m. – 12:00 p.m.

Members are urged to voice concerns regarding their developments

(Refreshments at 10:00 a.m.)

CONTACT: [email protected] PLACE: Musicians Union Local 802 322 West 48th Street (near 8th Avenue) Ground Floor, “Club Room” TRAINS: No. 1, train to 50th St. and 7th Ave.; Q, W trains to 49th St. and Broadway; E train to 50th St. and 8th Ave. Mitchell-Lama Residents Coalition Box 20414 P.O. Station West Park 10025 York New York, New Page 2 December 2013 Promenade to exit M-L; owner promises to keep rents affordable under NYC contract UPCOMING EVENTS he Promenade, a Mitchell Lama of new housing under the Low-Income rental in the Marble Hill area of the Housing Trust Fund Program,” according TBronx, was purchased in October by to its website. GENERAL the Nelson Management Group, Ltd., which Under the deal with HPD, Nelson plans to remove the structure from the pro- will pay no property taxes, although it may MEMBERSHIP gram within the next few months. have to pay a three percent tax on whatever The company plans to maintain the income it receives from the tenants (both Saturday, January 25, 2014 318-unit development, constructed in 1972, residential and commercial). In addition, as affordable housing for current residents it will avail itself of the the J-51 program, a ---- through a four-decade agreement with the separate NYC tax abatement program, after 10:00 a.m. - Noon city’s Departent of Housing Preservation and it agrees to improve the building’s decks. Development (HPD). The new owner has already begun On its website, Nelson claims to be the process of elevator replacement, which Members are urged to voice “particularly adept in the ownership/man- may take at least a half year to complete. concerns regarding their develop- agement of Rent Stabilized, Section 8 and ments, especially long- and short- Mitchell Lama properties.” It currently owns term standing issues or manages twenty-two housing develop- ments, containing a total of more than seven- Heritage tenants face rent ty-three hundred units. hikes as LAP ends ---- The previous owners have reportedly claimed that it was unable to secure financ- ong-time tenants at the Heritage, a for- Musicians Union, 322 West 48th ing necessary to maintain the building. As a Lmer Mitchell-Lama development once Street, between 8th and 9th result, residents often complained about inef- known as Schomburg Plaza, are facing Avenues fective maintenance. imminent market-rate rent hikes as their Nelson purchased the Promenade one protection--the Landlord Assistance after creating a housing development fund Program--comes to an end. LAP is a pro- For more information, e-mail:

company, which is eligible to receive funding gram offered by landlords to tenants, but is [email protected]

and other assistance from the state’s Housing not regulated by any government agency. . Trust Fund Organization. The primary func- Local media reports indicated that tion of the HTFC is “to create decent afford- the owner, Urban American Management, able housing for persons of low-income by which purchased the 600-unit building at providing loans and grants for the rehabilita- 1295 Fifth Avenue in East Harlem in 2007, Mitchell-Lama Residents tion of existing housing or the construction has given tenants only thirty days to either Coalition, Inc. pay market rents or vacate.

Officers Co-chairs: Jackie Peters Ed Rosner

JOIN THE MITCHELL-LAMA RESIDENTS COALITION Margo Tunstall 2014 INDIVIDUAL $15.00 per year and DEVELOPMENT 25 cents per apartment Treasurer: Carmen Ithier ($30 Minimum; $125 Maximum) Financial Sec’y: Alexis Morton Name______Recording Sec’y: Sonja Maxwell Corresponding Sec’y: Katy Bordonaro Address______Apt.______

City______State______Zip Code______MLRC NEWSLETTER STAFF Evening Phone______Day Phone______Editor: Ed Rosner

Fax______E-mail ______Assistant editors: Katy Bordanaro Sonja Maxwell Current ML: Co-op______Rental ______Jackie Peters Margo Tunstall Former ML: Co-op______Rental ______Editorial Coordinator: Nathan Weber Development______Renewal____New Member____ Circulation: 5,000 President’s Name: ______

Donations in addition to dues are welcome. Articles, letters, and photographs are wel- come. Send to MLRC, P.O. Box 20414, NOTE: Checks are deposited once a month. Park West, New York, NY 10025 Mail to: MLRC, PO Box 20414, Park West Finance Station, New York, N.Y. 10025 Fax: (212)864-8165 Voice Mail: (212) 465-2619 MLRC fights for you and your right to affordable housing! email: [email protected] December 2013 Page 3

term, fixed-rate multifamily rental loans, Affordability crisis grows impending reform of the housing finance sys- tem will also have profound implications for the cost and availability of multifamily credit. for tenants across nation Although some have called for winding Edited and reprinted with permission from “America’s Rental Housing: Evolving Market down Fannie’s and Freddie’s multifamily and Needs,” 2013, Harvard Joint Center for Housing Studies, www.jchs.harvard.edu activities and putting an end to federal back- stops beyond FHA, most propose replacing gainst the backdrop of the rental their numbers by more than 2.5 million the implicit guarantees of Fannie Mae and market recovery, declining renter over the decade. For families and individu- Freddie Mac with explicit guarantees for incomes continue to add to long- als unable to find affordable housing, the A which the federal government would charge a standing affordability pressures. Already consequences are dire. Among households fee. up sharply before the recession began, the with less than $15,000 a year in expendi- share of cost-burdened renters took a turn tures (a proxy for low income), severe cost for the worse after 2007. As a result, the burdens mean paying about $500 more for Federal role critical Proposals for a federal backstop dif- share of renters paying more than thirty housing than their counterparts living in fer, however, in whether they require a cap on percent of income for housing, the tradi- units they can afford. the average per unit loan size or include an tional measure of affordability, rose twelve affordability requirement to ensure that credit percentage points over the decade, reaching Tenants cut back on food is available to multifamily properties with fifty percent in 2010. With little else in their already tight lower rents or subsidies. While the details are Much of the increase was among budgets to cut, these renters spend about clearly significant, what is most important renters facing severe burdens (paying more $130 less on food—a reduction of nearly is that reform efforts do not lose sight of the than half of income for rent), boosting forty percent relative to those without bur- critical federal role in ensuring the availabil- their share nearly eight percentage points dens. Severely burdened households with ity of multifamily financing to help maintain to twenty-seven percent. These levels were expenditures between $15,000–30,000 rental affordability, as well as in supporting unimaginable just a decade ago, when the (one to two times full-time federal mini- the market more broadly during economic fact that the severely cost burdened share mum wage work) cut back on food by a downturns. was nearly twenty percent was already similar amount. Housing affordability is Meanwhile, many organizations cause for serious concern. thus clearly linked to the problem of hun- are calling for finally funding the National ger in America. Both lower-income groups Housing Trust Fund, which was created More than 20 million tenants burdened with severe housing cost burdens also spend in 2008 to support production of housing In 2011, the last year for which significantly less on health care and retire- affordable to households with extremely detailed information is available, both the ment savings, with direct implications for low incomes. The question now is whether overall share of renters with cost burdens their current and future well-being. But Congress will recognize the vital importance and the share with severe burdens moved even those lower-income households that of this assistance to millions of Americans up by about half a percentage point. These manage to secure affordable housing face and take action on these promising new direc- increases expanded the ranks of cost bur- difficult tradeoffs, often living in inadequate tions. dened renters to 20.6 million, including conditions or spending more on transporta- 11.3 million that pay more than half their tion. incomes for housing. The limited growth in rental housing Met Council offers new tenant Initial estimates for 2012 indicate the assistance reflects a range of challenges fac- rights program on cable TV number of cost-burdened households again ing the programs delivering support. While increased to a record 21.1 million. funding for Housing Choice Vouchers—the etropolitan Council on Housing, a ten- Although the share of cost-burdened renters main vehicle for expanded assistance— Mant advocacy group, launched its new receded slightly, this modest improvement increased over the past decade, rising rents weekly TV program, “Tenant Action Today,” occurred only because the number of higher and falling incomes combined to raise the January 8 on community access cable. income renters rose sharply. per tenant costs of aid, limiting the pro- The program will be telecast live Housing cost burdens are nearly gram’s ability to reach more households. every Wednesday from 6:00 to 7:00 p.m. on ubiquitous among lowest income renters. Public housing, the nation’s oldest Manhattan Neighborhood Network. It will An astounding 83 percent of renters with assisted units, requires an estimated $26 consist of news reports on the tenant move- incomes of less than $15,000 were housing billion in capital investments that remain ment, how-to segments on tenants’ rights, cost burdened in 2011, including a dismal unfunded. Many privately owned subsidized and a hot line, where viewers can call in for seventy-one percent with severe burdens. developments were also built more than 30 advice and information. But the largest increases in shares in 2001– years ago and are now at risk of loss from It can also be seen at www.mnn.org, 11 were for moderate income renters, up the assisted stock due to aging and/or expi- by clicking on “Community Channel 1, Watch eleven percentage points among those with ration of contracts. Mandatory funding cuts Now” at the bottom of the home page. incomes of $30,000–44,999 and nine per- under federal budget sequestration have Manhattan viewers can watch on centage points among those with incomes of added to these pressures and could lead to a Channel 34 (Time Warner), Channel 82 $45,000–74,999. reduction of 125,000 vouchers this year. (RCN) or Channel 33 (FIOS). It will eventu- So far, the Low Income Housing Tax ally appear in all five boroughs. At present, Unemployment not main culprit Credit (LIHTC) program has been spared non-Manhattan viewers can watch on the Rising unemployment clearly con- from sequestration because it operates MNN web site from anywhere in the world, at tributed to deteriorating affordability. But through the tax code and therefore does not 6:00 pm New York City time. high unemployment rates are not the main require annual appropriations. By itself, Producer of “Tenant Action Today” culprit because the spread of burdens has however, the LIHTC does not provide deep is Michael McKee, Met Council board mem- been even greater among households with enough subsidies to make units affordable ber and treasurer of Tenants Political Action full-time workers. The cost-burdened share for extremely low-income tenants, so it is Committee. McKee will share hosting duties of renters who worked throughout the pre- often combined with other forms of assis- on a rotating basis with Jaron Benjamin, Met Council executive director, and attorney Tim ceding year rose by nearly 10 percentage tance. Collins of Collins, Dobkin & Miller. points between 2001 and 2011, boosting With Fannie Mae, Freddie Mac, and December 2013 Page 4 After long battle, Hip hop house, Family size no longer barrier a former Bronx M-L, to M-L for mid-income earners egardless of family size, surcharge. keeps units affordable households with an Among the M-L devel- income of more than opments affected by the esidents of the world their own enormous wealth, the R one hundred percent but less new law in New York City is famous “birthplace of hip investors themselves found it than 125 percent of the area Southbridge Towers, a 1,651- hop,” or 1520 Sedgewick increasingly difficult to access R median will now be allowed unit co-op at 90 Beekman Avenue in the Bronx, will financing, which led them to to gain access to remaining Street in lower Manhattan remain in their apartments at shun needed repairs. Eventually, Mitchell-Lama developments. near the Seaport. It was built affordable rents after defeating they missed mortgage payments, A new law, which went in 1969. speculative landlords and work- not untypical in light of the into effect in mid-November, Like many M-L devel- ing with groups of tenant advo- worsening state of the economy eliminates the old stipula- opments, Southbridge has a cates and affordable housing at the time. tion in which access had been history of internal disputes developers. In June of 2012, restricted to those middle- centering on plans to take it The building, a former Workforce Housing Associates income families who had two private--favored by those resi- Mitchell-Lama development, bought the building’s mortgage or more dependents. dents who want to sell their was originally owned by BSR for $6.2 million, with assistance Sponsored by State apartments in a super-hot real Managment. In 2008--the from a new City program that Senator Daniel Squadron and estate market--and those who start of the Great Recession sought to sustain viable neigh- Assembly Speaker Sheldon want to keep the units afford- and national housing bust-- borhoods, and additional finan- Silver, the new law still able for the general public. BSR sought to leave M-L, and cial help from the City Council. requires such families to pay a attempted to sell the building to By September 27 of this year, a group of private equity inves- renovations were completed. tors. Among them was Mark At a celebration of the Karasik, an investor well-known tenants’ victory, Kerri White nationally for his mega-million of UHAB said, “The tenants of dollar investments throughout 1520 Sedgwick began organiz- the country. ing to prevent a speculative MLRC Developments A sales contract between real estate deal that threatened the two real estate entities was building conditions and the signed , but the city’s Housing affordability of their homes. Individual Membership: $15 per year Preservation and Development When that campaign was Development: 25 cents per apt. ($30 minimum; agency attempted to block the lost, the tenants refused to be $125 maximum) sale, but failed. harassed or to settle for neglect- Donations above the membership dues are welcome. Tenants then organized ful maintenance, choosing in an effort to purchase the rather to keep fighting for their building and turn it into a lim- community.” ited equity co-op. They received The building secured its These developments are members of the Mitchell- support from Workforce reputation as the birthplace of Lama Residents Coalition Housing Associates, the Urban hip hop when one of its original Bethune Towers 158th St. & Riverside Dr. Housing Homesteading Assistance Board, tenants, who called himself DJ Castleton Park Parkside Development and Tenants and Neighbors. Kool Herc, held parties in the Central Park Gardens Pratt Towers But although the investors were recreation room back in 1973, Clayton Apartments. Promenade Apartments willing to sell, Karasik and his where he developed the rap- Coalition to Save Affordable RNA House associates’ asking price was ping style that eventually spread Housing of Co-op City Riverbend Housing Concourse Village River Terrace astronomical. Notwithstanding throughout the globe. Dennis Lane Apartments River View Towers 1199 Housing Ryerson Towers Esplanade Gardens Concerned Tenants of Sea Park Tax credits for tenants Independence Plaza North East proposed by Gov. Cuomo Jefferson Towers Starrett City Tenants Association Lindville Housing St. James Towers enants throughout New York erty tax credit plan, which would Lincoln Amsterdam House Strykers Bay Co-op TState are slated to receive a largely benefit landlords and Manhattan Plaza Tivoli Towers tax break on their rents under other homeowners. Also under Marcus Garvey Village Tower West Gov. Andrew Cuomo’s new tax the plan, the corporate tax rate Masaryk Towers Tenant Village East Towers reduction plan. Tenants with would drop to 6.5%, from 7.1%. Association Washington Park SE Apartments incomes of less than $100,000, And the threshold for the estate Meadow Manor Washington Square SE Apartments would be eligible; that amount tax would rise to $5.25 million. Michangelo Apartments West View Neighbors Association 109th St. Senior Citizen Plaza West Village Houses would increase for those with Finally, the top estate-tax rate children or other dependents. would drop to 10% for four years. The relief would take the Some have questioned form of a refundable personal whether the tax reduction plan If your development has not received an invoice, please call the income tax credit. would stymie NYC Mayor De MLRC Voice Mail: (212) 465-2619. Leave the name and address of The proposal to offer the Blasio’s efforts to increase taxes the president of your Tenants Association, board of directors, or trea- credit to tenants was widely seen on the wealthy, which he wants surer and an invoice will be mailed. as a political move by the gover- in order to provide pre-K school- nor to win support for his prop- ing for all NYC children. December 2013 Page 5 Three ways to improve the nation’s Low Income Housing Tax Credit program By Barbara Sard Vice president for housing policy, Center on Budget and Policy Priorities.

2013 marked the 27th anniversary of the federal Low Income Housing Tax Credit (LIHTC) program. Throughout the program’s tenure, what lessons have we learned? What key components continue to make it a successful program? The following essay was prepared for a forum by the Bipartisan Policy Center, a non-profit organization seeking solutions on some of the major issues facing the United States. It is reprinted with permission. For additional discussion on the LIHTC, see http://bipartisan- policy.org/blog/2013/10/02/housing-expert-forum-lihtc

he Low-Income Housing Tax Credit Gather and publish data on to meet their legal obligations, so that has worked well as a means to LIHTC tenants. No national data are policymakers and the public have the data Tfinance affordable housing devel- available on the families assisted by LIHTC, they need to understand who the proper- opment and rehabilitation. Going for- a striking omission for a program that has ties serve. ward, federal housing policy will depend operated for 27 years and funded more As Congress considers tax reform, on LIHTC to promote goals from ending than two million units. In 2008, Congress it should recognize the important role homelessness to facilitating independent directed state agencies to submit data on LIHTC plays and keep it in the tax code. living for a growing low-income elderly LIHTC tenants (including race and ethnic- But policymakers should also look for population. ity, income, family composition, and rental ways to strengthen LIHTC further and But like most successful programs, assistance receipt) and HUD to publish the make sure that LIHTC-financed properties LIHTC has room for improvement. Here data annually. There have been some data continue to provide affordable housing are three steps federal and state policymak- collection efforts, but five years later HUD opportunities for the lowest-income fami- ers could take to make LIHTC even more has neither released data nor provided a lies even if additional housing vouchers effective: timeline for doing so. HUD and the states are unavailable. Create a renters’ credit to help should invest the modest resources needed serve the neediest families. LIHTC relies heavily on rental assistance programs like Housing Choice Vouchers to achieve mixed-income occupancy, including fami- Older New Yorkers can expect lies with incomes close to or below the pov- erty line, who have by far the greatest need heavier heating bills this winter for help affording housing. New LIHTC lder residents of New York and paying their heating bill and paying for developments will struggle to reach this other states in the New England their prescriptions.” population unless the number of families Oand mid-Atlantic regions are likely Lower income residents--those with with rental assistance grows over time. But to spend considerably more money on incomes less than $20,000 a year--will funding constraints make a major expan- heating bills this winter, according to a suffer the greatest burden, even though sion of existing rental assistance programs new national report by the AARP’s Public higher income households tend to spend unlikely in the near term, and this year’s Policy Institute. more on heating. The latter’s higher rev- sequestration cut is expected to reduce the The report, based on federal data, enues will do more to cushion the energy number of families with vouchers by up to projected the region’s heating bills to rise price rise. 140,000. As part of tax reform, Congress an average of thirteen percent. New York State has around $190 should create a new renter’s tax credit to “New Yorkers already pay the high- million in federal funds under the Home make housing (in both LIHTC develop- est electric bills in the continental United Energy Assistance Program, down from ments and other buildings) affordable to States and the second highest in the $104 million last winter. HEAP benefits the poorest families. nation,” said an AARP press release that tend to increase with household size. For Increase use of LIHTC in high- accompanied the report, “60 percent above more information, call the NYS HEAP opportunity neighborhoods. LIHTC is the national average, according to the U.S. hotline at 1-800-342-3009, or go online at a potentially powerful tool to provide low- Energy Information Administration.” An http://otda.ny.gov/programs/heap/pro- income families access to high-opportunity AARP spokesperson added that “Too often, gram.asp. neighborhoods with strong schools. But older New Yorkers have to choose between LIHTC has performed inadequately in this area. A recent analysis found that, on aver- age, LIHTC units large enough for families HUD: Homeless population drops with children were near schools that scored in USA, but rises in New York City at the 31st percentile on standardized tests hile homelessness nationwide has which soared twenty-seven percent. — barely better than the average for schools Wdecreased this year, New York City’s Federal officials said a major cause near the homes of poor families, even own homeless population has grown, is the lack of affordable housing and the though many LIHTC tenants have incomes according to HUD. escalation of rents. above the poverty line. States could do The January 2013 combined shelter Meanwhile, another report from the much through their Qualified Allocation and street population in the city grew to National Center for Homeless Education Plans and other policies to encourage an estimated 64,060 people over the year, showed that student homelessness hit a LIHTC development in high-opportunity amounting to a hike of thirteen percent. nationwide record high--reaching 1.2 mil- neighborhoods. That made the city’s homeless population lion students during the 2011-12 academic growth second only to that of Los Angeles, year. December 2013 Page 6 Our new mayor’s true progressive predecessor: Fiorello LaGuardia by Lib Tietjen This article first appeared in Notes from the Tenement, the official blog of the Lower East Side Tenement Museum.

n January 1st, New York City got serve as a pilot in the First World War. He became mayor; LaGuardia favored strong a new mayor – Democrat Bill de regained the seat in Congress in 1922 and unions, public welfare programs for the OBlasio, who ran on a platform of held it until 1933, when he lost his seat in a poor, expanding public works programs for social and economic change. However, he’s Democratic landslide. the unemployed which included rebuilding certainly not the first progressive in Gracie Despite being a Republican, or new construction of roads, parks, and Mansion. LaGuardia appealed to voters in both par- other structures (including an airport that Mayor de Blasio has some big shoes ties, and he successfully ran for mayor in would be named after him), immigration to fill, but some of the most famous shoes 1933 on a “Fusion” ticket (one that con- reform, and housing issues like slum-clear- might not fit him… de Blasio is the city’s sisted of Democrats and Republicans who ance and low-cost housing; the tradition tallest mayor, standing at six feet five inch- were against the corruption of Tammany of which has led to the Fiorella LaGuardia wes, and he has to live up to political giant Hall). Instead of participating in the tradi- Houses on today’s Lower East Side. Fiorella LaGuardia, who was just over five tional New Year’s Day Mayoral inaugura- LaGuardia fought to curb gambling feet tall. tion ceremony, LaGuardia made numerous in New York City, as it was often controlled LaGuardia, a Republican, was appearances across the city, promising by the mafia. A famous photo shows him elected to three terms as mayor from 1934 voters to change the corrupt municipal smashing confiscated slot machines that to 1945, and is perhaps the most famous government and change their lives for the will then be dumped into Long Island mayor in New York’s history; his policies better. Sound. changed the face of the Lower East Side While a law student at NYU, In order to ease the street con- forever. LaGuardia worked for the Society for the gestion of the Lower East Side, in 1940 Born in Greenwich Village to Prevention of Cruelty for Children and LaGuardia created the Essex Street Market an Italian father and Jewish mother, served as a translator at Ellis Island, help- to give street vendors a safe and steady LaGuardia was raised in Arizona and ing new immigrants navigate the frighten- place to sell their goods, thereby changing Trieste (a northeastern Italian city and his ing new land, and seeing first-hand how the look and character of the neighbor- mother’s birthplace) before returning to New York’s newest inhabitants lived. hood. New York City in 1906 to study law at New After he graduated from law school, Despite his short stature, Fiorella York University. Elected to Congress in he began a firm that represented immi- LaGuardia is a huge figure in our city’s 1916, LaGuardia represented a notoriously grants, factory and sweatshop workers, history. At the start of this new year and poor section of East Harlem and developed and street peddlers of the Lower East Side, new political era, we’re excited and hopeful a reputation as a fiery defender of progres- often free of charge. about New York City’s future. sive causes. His dedication to helping the people He resigned his seat in 1919 to of the Lower East Side did not stop once he

City officials, tenant leaders celebrate at MLRC’s holiday pot luck luncheon

NYC Comptroller-elect Scott Stringer (holding his son, Max); to his left Manhattan Borough President-elect Gale Brewer; behind her Nick Prigo, District Leader & Chair of CB7’s Housing Committee; MLRC board members and officers and various tenant advocates, at the MLRC’s Pot Luck Holiday Luncheon on 12/7/13. December 2013 Page 7 Retirement theft in four despicable steps by the one percent By Paul Buchheit Reprinted from from NationofChange he fear of running out of money in Social Security costs less than half of that, paid just 1.8 percent of their total income retirement is America’s greatest finan- Congress is targeting Americans who have in state taxes (3.6 percent of their declared Tcial concern. It’s a fear greater than paid into it at the highest rate, while tax U.S. income). The average required rate for death. avoiders are left undisturbed. the fifty states was 6.56 percent in 2011. But the American workers who have From whom does Congress propose Similar results were found in a paid all their lives for retirement security to take retirement benefits? From people Citizens for Tax Justice (CTJ) report on are being cheated by wealthy individuals whose average retirement account is under 2008-10 state taxes, which found that 265 and corporations who refuse to meet their $30,000, and for whom Social Security is large companies paid an average of three tax obligations, and who have found other the largest source of retirement income. percent in state taxes, less than half the ways to keep expanding their wealth at the From those who have already experi- average state tax rate. The results are sum- expense of the middle class. enced Social Security cuts through delayed marized at Pay up Now. cost-of-living adjustments and higher taxes. How much money is this? The miss- Federal Tax Avoidance Is the Biggest From the half of the middle class ing three percent tax on over two trillion Threat to Social Security whose food budget, by one estimate, will be dollars in profits is anywhere from thirty Conservatives say that Social Security five dollars a day in their retirement years. billion to sixty billion dollars, depending is too expensive, and that cutbacks and on the true U.S. portion of total corporate a later retirement age are necessary. But State Tax Avoidance Defunds income. they refuse to acknowledge the facts about Pensions But instead of taking on the delin- missing revenue. Annual tax avoidance by In what Pulitzer Prize winning jour- quent corporations, states have increased- wealthy individuals and corporations is in nalist and author David Caye Johnson, spe- sales taxes and property taxes while building the trillions of dollars, over double the cost cializing in economics and tax issues, calls up their regressive lottery systems to the of Social Security. “nothing short of theft,” states are reneging point that eleven states collected more rev- Big corporations are the worst on pensions that workers have been paying enue from their lotteries in 2009 than from offenders. The numbers are startling. For into for years. Illinois, Michigan, California corporate income tax. every dollar they paid relative to payroll tax and a slew of other states have mismanaged in the 1950s, they now pay ten cents. In just and squandered funds that belong to their Corporations Play One Underfunded the past ten years they’ve cut their tax rate employees, and then, in effect, have blamed State Against Another in half. those employees for the mess by penalizing The news from the states gets even The sum total of tax underpayments, them with pension cuts. worse. On the pretense that their presence tax haven losses, corporate tax avoidance, Once again, one of the reasons for enriches the people of their home states, and tax expenditures (most of which benefit the shortfall is corporate irresponsibility. In and that subsidy-green pastures lie right the very rich) is over $62 trillion. Although 2011 and 2012, 155 of the largest companies Continued 0n Page 8 Brooklyn ML Task Force honors outgoing Boro President Markowitz arty Markowitz (cen- Mter, holding plaque) at 2013 Brooklyn ML Task Force farewell party break- fast in Brooklyn, where he recently completed his three-term service as bor- ough president. Attending were several ML members, thanking him for establish- ing an education forum for residents of various ML developments in the bor- ough. Honoring him were ML Task Force organizers Pat Orr-Winston of Atlantic Towers; Naomi Chappelle of Lindsay Park; and Monica McIntyre of Henry Silver Management. Another Task Force member, Margo Tunstall-Brown of Sea Park East, Inc., was unable to attend for medical reasons. She is currently an MLRC chairperson. Page 8 December 2013 Retirement theft in four despicable steps by the one percent Continued from page 7 higher than any of the top one hundred years (with the historical six percent companies in the nation. return) and then holding the accumulated across the border, companies have cun- Washington is another state being sum for another twenty years would end ningly negotiated tax-cutting deals in return victimized, at the hands of Boeing, which up with $269,000 in a non-fee fund, but for the promise to stay. A Good Jobs First according to Citizens for Tax Justice paid just $165,000 with the industry average report escribes the process, which costs nothing in federal taxes over ten years 1.3 percent fee. state and local governments up to $80 bil- and nothing to Washington in state taxes, In the individual states, banks have ion a year. despite thirty-two billion dollars in pre- their fee-absorbing tentacles wrapped Dozens of deals have been con- tax U.S. profits. Now, while engineering around employee pension plans. In Rhode trived, at least ten each in Michigan, New a bidding war among multiple states, the Island it is projected that $2.1 billion in York, Ohio, Texas, Louisiana, Tennessee, company has wangled the nation’s single fees will be paid to hedge funds, private- Alabama, Kentucky, and New Jersey. biggest state tax break ($8.7 billion over equity funds, and venture-capital funds Sixteen states have enacted the Private sixteen years) while informing its employ- over the next twenty years, about equal Income Tax (PIT) diversion, by which ees that their pension and benefits will be to the amount saved by freezing Cost of employers rather than governments get to slashed. Living Adjustments for public workers. withhold state income taxes from employ- In California, the tech giant Apple In Detroit, $250 million in bank- ee paychecks and to keep all or some por- has its own way of dealing with state taxes, ruptcy expenses was doled out to firms tion of the funds. claiming residency in tax-free Nwvada. that employ lawyers, accountants, finan- Illinois’ pension mess has its roots Ill-informed state leaders might heed cial analysts, and public-relations con- in corporate threats to bolt the state: the findings of a New York State Tax sultants. In South Carolina the plunge by $100 million to Motorola; $150 million to Commission, which said: “There is...no pension managers into private equity and Sears; $56 million to Boeing to bring its conclusive evidence from research stud- hedge funds has resulted in $1.2 billion in headquarters to Chicago; and nearly $200 ies conducted since the mid-1950s to fees since 2008. million to Caterpillar, which paid only two show that business tax incentives have an American workers and retirees are percent of its U.S. income in state taxes impact on net economic gains to the states the victims, and their numbers are grow- in 2011-12, and whose CEO called Illinois above and beyond the level that would ing. According to the National Institute on “unfriendly to business.” have been attained absent the incentives.” Retirement Security, almost half (forty-five Meanwhile, other Illinois com- percent) of working-age households do not panies are trying to get in on the hand- Banks Take a Big Chunk of Our own any retirement account assets. The outs. Agribusiness leader Archer Daniels Retirement Accounts average working household has virtually Midland is threatening to leave the state. Nearly two dollars of every five dol- no retirement savings. But it doesn’t mat- The Chicago Mercantile Exchange made lars in potential 401(k) earnings is lost ter to business-happy privatization advo- a big fuss over its tax bill in 2011, even because of bank fees. An individual invest- cates, who don’t seem to recognize that though its 2008-10 profit margin was ing one thousands dollars a year for thirty this poorer half of America even exists.

HPD seeks changes ‘My Social Security’ account to M-L succession now provides free proof of income

Continued from page 1 he MLRC has been asked by through “My Social Security.” the New York regional pub- To register, visit www.socialsecuri- to relatives or partners once the two-year Tlic affairs office of the Social ty.gov/myaccount, and follow the instruc- period has elapsed. Those relatives, in Security Administration to encourage tions. While divulging personal information effect, bypass others who have been wait- its members to register for a “My Social is required to create an account, the SSA ing years to secure a M-L apartment. Security” account, a free online gov- says all information will remain confiden- State Senator Daniel Squadron ernment service through which people tial through user names and passwords. argued that the proposals ignore the who currently receive a monthly Social notably changing nature of family com- Security and/or Supplemental Security positions today, for example by removing Income (SSI) benefit may obtain proof common-law relationships and by not of income without having to visit their including same-sex couples or others who local Social Security office or call the provide family care. Today, care is often national toll-free number. provided by nieces, nephews, aunts and “My Social Security” is also a site uncles, all of whom would be denied suc- where people age eighteen and older cession rights under the proposed rules. who have a work history may check An HPD spokesperson said all com- their annual Social Security earnings. ments received at the November 6 hearing Previously, the SSA mailed an annual SS will be considered prior to finalizing the earnings statement to workers age twen- rules. ty-five and older. Budget constraints have forced those mailings to cease, but the information is now available online