By Sabina Mollot
Waterside residents who are getting close to retirement age — but don’t plan to retire by next year — are asking the city to expand on a deal that’s aimed at giving some kind of rent relief to the complex’s “settling” tenants.
The tentative agreement between landlord Richard Ravitch and the city, which was announced in August, would offer either rent reductions, rent freezes or lower annual increases to 325 settling tenants, depending on their incomes, for 75 years. Settling tenants are individuals who moved into Waterside when it was still in the Mitchell-Lama affordable housing program and later entered into a different agreement with the owner to have an annual rent increase that is now 4.25 percent.
The part of the recent deal that’s caused some controversy however, is an additional benefit offered to tenants who retire by the end of 2019. Those tenants will receive a one-time rent reduction to 30 percent of their household income.
As Town & Village previously reported, local elected officials and tenants have asked if the HPD would consider extending the retiree offer by several years, but the agency has already indicated this won’t happen.
Those tenants are still hopeful however, with five Watersiders giving testimony before the City Planning Commission on Wednesday, October 31 and even more giving written testimony, according to Waterside Tenants Association President Janet Handal.
Handal, along with the rest of the WTA, has enthusiastically endorsed the plan, but also hopes that another two to eight years be added to the retirement benefit.
When testifying, she said she tried to stress that while settling tenants are considered middle income, once they retire, two thirds will be low-income (earning less than 80 percent of the area median income) and severely rent-burdened. If the city invests more money into the plan to accommodate those tenants, ultimately, argued Handal, it’s still cheaper than building more affordable housing and putting older tenants in a lottery for it.
“Thousands of people are on these wait lists,” said Handal. “How does it make sense to take more people out of their apartments and build additional housing for them?”
She added that the settling tenants (745 people) are overwhelmingly in their late 50s or older, many having lived at Waterside since it opened in 1974. Two thirds of the settling population are retired, with the rest “still working but close” to retirement.
Handal has also requested that, when calculating residents’ income, that the city follow state tax and SCRIE (senior citizen rent increase exemption) rules and exclude distributions from retirement accounts, and deduct medical expenses.
Another resident, who is several years away from collecting Social Security, as is her husband — and therefore several years away from retirement — told Town & Village that her rent has tripled since Waterside left Mitchell-Lama.
“It’s a longterm issue that no one’s really addressed,” said the resident, about what happens to residents of properties where owners are able to opt out of the program. “So many of our neighbors at Waterside retired and they left the city because they can’t afford to live here anymore,” she added. “My husband and I raised our daughters here and we want to age in place. But based on our retirement income, we wouldn’t be able to afford this rent.”
At the hearing before the commission, Council Member Keith Powers also testified in favor of expanding the deal. Though he didn’t ask for anything too specific, Powers said he would like to see the agreement become “more inclusive to those facing retirement in the coming years.”
As T&V previously reported, for tenants earning under 165 percent of the area median income and paying over 30 percent of their household incomes in rent — effectively making them rent-burdened — their rents will become 30 percent of whatever their incomes are. Currently, 165 percent of the AMI is $120,615 for one person, $154,935 for a family of three and $185,995 for a family of five.
Tenants earning under 165 percent of the AMI who are not rent-burdened will get rent freezes. Tenants earning over 165 percent of the AMI will see their annual rent increases reduced to either 2.25 percent or whatever the Rent Guidelines Board votes as an increase for the city’s rent-stabilized tenants even though Waterside is not rent-stabilized. However, the increase will be capped at 4.25 percent.
In exchange for the loss of rental income, the landlord will see a reduction in the property’s PILOT payments (payments in lieu of taxes) and get the lease to the city-owned land extended to 99 years. The affordability arrangement has had the input of the landlord, tenants, local elected officials and the HPD.
This plan is currently going through ULURP (Uniform Land Use Reform Procedure), and after it’s reviewed by the City Planning Commission, it will go to City Council for a vote. After the ULURP is completed, HPD has final discretionary approval to put the deal into effect.
The HPD didn’t respond directly to a question on if it was considering tenants’ request on the retiree eligibility, but spokesperson Matthew Creegan issued the following statement.
“We’re excited to push forward with this unique opportunity to lock in affordability for 325 households at an unregulated property in downtown Manhattan. We look forward to further discussions with City Council as this deal goes through the public review process.”
Waterside management didn’t respond to a request for comment.