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Mayor Michael R. Bloomberg's Speech on Affordable Housing in New York City
The Enterprise Foundation's 2004 Network Conference at the Marriott Marquis
October 14, 2004

Good afternoon.

I want to thank Shaun Donovan for that kind introduction.

He's not only an eloquent speaker; he's also a highly effective City Commissioner, who is doing an extraordinary job directing New York's affordable housing policy.

Now, to all of you who are here from out of town.

Welcome to New York.

Take it from the mayor: There's never a bad time to visit our city. But there really is something special about "autumn in New York."

For a lot of New Yorkers - me included - October means championship baseball in the Bronx.

Last night, the Yankees continued to battle the Red Sox for the American League pennant - writing one more chapter in the greatest rivalry in professional sports.

But those of us who are of a certain age can remember another October ballgame in the Bronx that wasn't so glorious.

It was during the 1977 World Series.

It was a night game, and Howard Cosell was in the broadcast booth.

And speaking to a national audience, he directed the television cameras away from the action on the field, and toward a building being consumed by fire just a few blocks from the stadium.

"Ladies and gentlemen," he said, "The Bronx is burning."

It was a bleak picture in a disheartening time, because the harsh truth was that whole blocks in the South Bronx, and in other communities in our city, were being vandalized, abandoned, and even going up in flames.

Some neighborhoods lost three-quarters of their residents in the space of just ten years.

Tax delinquency was so common in some communities that the City became the biggest landlord in New York.

We had 100,000 units of abandoned housing in our portfolio - a distinction that we certainly didn't want, but that we took on because someone had to stand up for our neighborhoods.

Today, those times are a rapidly fading memory. Because we've pushed crime to historic lows, and made New York the safest big city in the nation

Because we've learned to do more with less and improved the quality of life in all five boroughs

And because non-profit, community-based organizations, like so many of you here today, have done such outstanding work preserving housing and rebuilding neighborhoods

New York City is a place where businesses want to come, and people want to live.

And that's reflected in the revival of the housing market throughout the city.

In fact, where Howard Cosell once said the Bronx is burning, today, the Bronx - along with the other four boroughs of New York - is building.

Last year, we had the highest level of housing starts in 30 years.

Take the South Bronx's Charlotte Street...

Both Jimmy Carter and Ronald Reagan used visits there to spotlight urban decay.

Some compared it to Dresden after the bombing of World War II.

Today, on Charlotte Street, children play on thick green lawns in front of houses that prove the American Dream is alive and well in New York City.

And similar success stories have been written in neighborhoods throughout our city.

The turnaround of the last two decades has been a real tribute to the "partnerships for successful community development" that are the theme of this conference.

Now, we all know that no good deed goes unpunished, or that no blessing is unmixed.

And in a sense, we are now the victims of our own success.

Take that portfolio of 100,000 apartments that the City held 25 years ago.

Today, it has shrunk to just three thousand.

That means 97,000 apartments have now become homes to working people in our city.

As wonderful as that is, it also presents a challenge. Where will we find today's affordable housing?

Our Administration has to find a different way to meet the urgent demand for affordable housing for today's New Yorkers who are eager to start their climb up the economic ladder.

They're the people I meet at church services and civic meetings in every community in our city

They're receptionists and janitors, delivery truck drivers and nurses

They're receptionists and janitors, delivery truck drivers and nurses

They're at work right now in this hotel in the restaurant around the corner, and in the hospital down the street. They're strong and hopeful men and women.

They've chosen this city as their home because New York City means enterprise and freedom to them, and to people around the world.

And they know that New York has come back from 9/11, and from a deep and painful recession, and is headed in the right direction.

They appreciate that we've driven crime down 14 percent in the last 3 years.

They can tell you that our economy is coming back, and that there's a new sense of optimism and opportunity in all five boroughs.

They're enthusiastic about our efforts to reform the public schools, because they want their sons and daughters to have the education that will allow them to take part in the great American dream.

They're the future of our City.

And they desperately need good homes in communities of dignity, achievement, and hope.

Where will they find those homes?

Ironically, the same New York renaissance that draws them here also drives up rents and the cost of homes for them.

During the last five years, land prices across the city have risen by 40 percent per year - a far cry from the desolate days of the 70's.

Abraham Lincoln once said that, "As our cause is new, we must think anew and act anew."

That's why our Administration has created a new paradigm of partnership for successful community development.

We call it: "The New Housing Marketplace."

It's our plan to fund the creation, or preservation, of 65,000 units of housing - affordable homes for 200,000 New Yorkers - by the end of 2008.

And to do that, we're using innovative methods to stimulate the development of affordable housing - by creating incentives and removing barriers to development.

We are, for example, engaged in the most ambitious re-zoning of the city in a generation.

It's targeting abandoned waterfronts, underutilized manufacturing areas, and brownfields.

And we expect it to create the conditions for developing 25,000 units of new housing for New Yorkers.

To make sure a large share of these units are affordable, we are inventing new "inclusionary" zoning policies that allow developers to build more apartments in exchange for keeping some affordable.

These policies harness the vitality of our housing market - turning the challenge of today's high prices for market-rate units into an opportunity to create low-priced homes as well.

We've identified vacant City-owned land that can be used to create an additional 7,000 affordable housing units.

Earl Andrews, the vice-chair of the Housing Authority who is here today, and others, are finding creative ways to rejuvenate underutilized public housing property, and other resources that can be used to generate affordable housing.

We're taking a new approach to working with our government partners, as well - applying the expertise we developed by fixing up the City's abandoned properties.

Along with HUD, we are well underway in revitalizing more than 400 buildings that had fallen into foreclosure under their FHA-insured mortgages.

We hope to expand this successful model to cover thousands more units in both single-family and multi-family FHA properties.

But we also know that we will no longer be able to meet the demand for affordable housing in New York City solely with land and properties that we, or our sister agencies, control.

We must complement this strategy with an approach that allows community-based non-profits and other affordable housing developers to compete for privately owned sites in today's highly competitive marketplace.

As you know, piecing together the needed subsidies to make affordable housing work can take time - but landowners won't wait when they have many other market-rate developers offering top dollar today.

To solve this problem, we've brought seven of the city's largest banks together to create a $200 million revolving loan fund to help non-profit and for-profit affordable housing developers acquire sites, including brownfields, and cover their pre-development costs.

We call it the New Venture Incentive Program, or "New VIP."

To make sure these new strategies succeed, we've also committed $3 billion in City funds to the New Housing Marketplace plan.

The new funding our Administration has provided has increased production of new units by 25 percent and blazed the way for the commercial and non-profit housing investment we need.

We launched the New Housing Marketplace in December 2002 - and today I can tell you that we're on course to meet its 65,000-unit target.

By the end of this fiscal year, we will have started production and preservation of 26,000 homes and apartments.

That will put us 40 percent of the way to reaching our goal two years into our five-year plan.

We're right on track.

But this isn't really about spreadsheets and statistics.

The great thing about the New Housing Marketplace is that you can go out and see it taking shape right before your eyes.

You can go to the Lower East Side, where the first building in a four-building complex on Chrystie Street is nearing completion.

The topping-off ceremony is set for three weeks from tomorrow.

And when it's completed, the entire Chrystie Street development will have 700 new mixed-income apartments.

And in Bushwick at Rheingold Gardens - built on the site of a famed Brooklyn brewery that had become a long-abandoned brownfield - the first of 250 families moved in over the summer, and the others will move in time to celebrate the winter holidays.

Our Administration is absolutely committed to helping them and tens of thousands more New Yorkers fulfill their dreams.

But we can't do it alone.

We need the help of our friends in Washington DC, who fund our Public Housing, give us HOME and community development block grants, and provide crucial funding for supportive housing.

But more than any of these, we need Congress and the President to stand by their commitment to the lowest-income Americans by fully funding the Section 8 program.

With 110,000 vouchers, the largest program in the country by far, New York City depends on Section 8 in countless ways.

I've written and spoken to Secretary Jackson several times in recent months, and he has responded by restoring $52 million to our voucher funding.

But, ultimately, Congress holds the purse strings for Section 8 and other Federal housing programs, and no voice is strong enough to reach them, if it's speaking alone.

Congress must hear a chorus from every corner of the nation, and we've got the start of a pretty good chorus right here in this room.

Now, Federal funding is important, but there's something even more crucial to creating affordable homes - the strong involvement of private and non-profit funders and developers.

That's the keystone of the New Housing Marketplace.

And today, I'm happy to announce that an old friend of our city is making a major new commitment to the New Housing Marketplace.

It's the Enterprise Foundation.

Today we began by recalling the 1970s, when a lot of people were ready to write off New York City as a lost cause.

But not the Enterprise Foundation.

In 1986, Jim Rouse, the founder of the Enterprise Foundation, came here to New York, to stand next to former Mayor Koch to help launch an unprecedented $5 billion housing program.

And over the last 18 years, the Enterprise Foundation has been there for New Yorkers, investing $1 billion to create and preserve affordable housing through talented community-based non-profits, many of them represented here today.

Now, the Enterprise Foundation, in partnership with City government and major financial institutions, is committing $1 billion over the next five years in equity, grants, and loans to build and preserve 15,000 affordable homes for New Yorkers.

Or let me put it this way: during the last 18 years, the Enterprise Foundation has invested $1 billion in affordable housing in New York. Over the next five years, they're going to match that, and help us meet our target of funding 65,000 units by 2008.

About $200 million of these funds will be used to protect the gains we've made. Some of it will preserve affordable homes for 4,000 low-income senior citizens - people who are especially vulnerable to the upward push on rents in so many city neighborhoods.

Preservation funds will also go to help non-profit housing developers in the city take advantage of low-interest rates, restructure their debts, and keep rents in their buildings affordable to hard-working New Yorkers.

Another $25 million will go toward grants, low-interest lines of credit, and training and technical assistance for community-based non-profit developers.

These resources will ensure that our non-profit partners can meet the challenges of our new housing marketplace here in New York City.

The remainder of these new funds will go toward construction of new affordable housing.

As we announced last month, $150 million of it will finance development of 2,500 units of supportive housing for the mentally ill homeless, adolescents aging out of the foster care system, and other people who need help getting their lives back on track.

This new supportive housing will keep them from winding up on the streets or as permanent residents of City shelters.

And it represents a big part of our city's ambitious plan to end chronic homelessness in New York City.

$80 million of these new construction and development funds will provide financing for the acquisition and development of privately owned sites by Enterprise's non-profit partners here in New York - a perfect complement to the City's "New VIP program."

And the remaining $545 million in the Enterprise Foundation's new commitment will finance production of other affordable housing and commercial space.

I want to personally thank the Enterprise Foundation, and its chairman and CEO Bart Harvey, and president and COO, Terri Montague, and also Enterprise New York, and its senior vice president and eastern regional director, Bill Frey, for this tremendous vote of confidence in New York City.

And I want to assure you and everyone here that HPD Commissioner Shaun Donovan and the rest of our Administration intend to be around for the next five years to make sure that your investment bears fruit.

Like the Enterprise Foundation, we're confident in New York's future.

Because on our watch, New Yorkers have been tested.

We've faced challenges that were unimaginable just a few years ago.

And, with the help of friends like the Enterprise Foundation... we've met them all.

And now I can promise you the best days for this city are yet to come.

Thank you very much.