Back in 2004, members of Picture the Homeless identified CLTs as a solution to lack of housing permanently affordable to the extremely poor, and we began to work toward NYC has thousands of vacant properties, both vacant land and vacant buildings, and our Housing Not Warehousing Campaign has been working to inventory vacant properties and develop a plan for their use.
Here in NYC there is a groundswell of support and activity towards the creation of Community Land Trusts as one strategy to address the City's housing crisis. This is partially fueled by the tremendous number of vacant properties, some long term and warehoused and others newly constructed luxury condos in various stages of completion, or completed but unable to sell. And of course it's fueled by the unabated housing crisis, and the hundreds of thousands of households that are doubled and tripled up. Many of the vacant properties are in low income communities of color and in NYC there is a high correlation between vacant buildings and land, gentrification and homelessness. We have a couple of CLTs here in NY, and the Cooper Square CLT in particular has been part of these conversations.
Our 2007 report, “Homeless People Count” documented the findings of the block by block, borough wide count of vacant property in Manhattan that we carried out in conjunction with the Manhattan Borough President. Our strategy is to win a city wide count of vacant properties and then to use that as an organizing tool to spur dialogue and expand community planning practices to create mechanisms that will allow for the utilization of vacant properties for the benefit sectors of the community currently excluded from community development, particularly for the lowest income community members.
In the fall of 2011, Picture the Homeless and City College engaged in an experimental class in which City College students and Picture the Homeless members and staff studied affordable housing policy and permanently affordable, community-controlled alternatives together. We focused particularly on Community Land Trusts and Mutual Housing Associations, models that seek to provide permanently affordable, community- and resident controlled housing. One of our projects was a survey of Community Land Trusts and Mutual Housing Associations in urban areas that house people with extremely low incomes, defined as either being under 30 percent of area median incomes, or below $20,000 a year. These are the people most at risk of homelessness.
Based on preliminary research in the National Community Land Trust Coalition database, we decided to focus on urban CLTs. Based on online research we identified a list of mutual housing associations, also in cities, that served at least some people with extremely low incomes. Of a total of thirty-eight organizations identified, we settled on a group of thirty to approach with a survey (several groups had ceased to exist; another appeared twice under different names). Seventeen organizations responded to the survey after a first contact by phone.
The survey asked about each organization’s age, governance structure, and history; the age, composition, and size of its housing stock; the mix of subsidies and financing of its housing; and the income mix and targeting of subsidies to lower-income households. Our aim was to identify whether and how urban CLTs and MHAs house people with very low incomes, whether there were practices that appeared to be promising in the context of New York City, and whether there were particular organizations that we might study more closely in order to inform our efforts to catalyze the founding of CLTs in poor, unstable neighborhoods in New York that could mitigate the problem of homelessness.
We believe it is timely to launch a vigorous public dialogue about establishing community land trusts in New York City as a viable alternative for the long-term preservation of affordable housing. This is a proposal to begin such a dialogue. We welcome your ideas and feedback.
A community land trust (CLT) is a non-profit organization that owns property, traditionally land, and leases it for affordable housing. The deed to the land, the CLT by-laws, and the lease all require that the housing be permanently affordable. The land can never be traded or sold to the highest bidder on the private market.
The CLT owns the land and can lease the land to any one of the following:
A non-profit mutual housing association (MHA)
A non-profit limited-equity cooperative
A non-profit community development corporation (CDC)
A one- or two-family homeowner, with resale restrictions
A condo association, with resale restrictions
If the building is a Mutual Housing Association, the CLT limits rents that can be charged. If the building is a coop, the CLT requires the coop to limit the resale prices of units. If the leaseholder is a limited-equity cooperative it may also place restrictions on monthly charges and sales prices. If the leaseholder is a non-profit managing rental property, the CLT provides protection for tenants; in places where rents are regulated it adds an extra layer of protection for tenants. CLT rules prevent tenants and owners from selling out to speculators and making windfall profits.
The board of directors of the CLT is usually made up of the following groups:
People who live in the housing (tenants or homeowners)
Community representatives
Public representatives (from local government)
The proportion of members in each group may vary but generally community and public representatives make up the majority of the CLT board. This helps to place a check on the temptation for residents to sell out to the highest bidder, thereby contributing to neighborhood gentrification and displacement. However, residents, as members of the coop or MHA, remain in control of building management. This combination of an independent CLT board and resident control helps to guarantee that the goal of permanent affordability is met while residents retain control of management. It is also important that there be overlap between the directors of the CLT and the residents. For example, in the case of a limited-equity coop, some members of the CLT board will also be on the coop board and some members of the coop board will also be on the CLT board. This overlap helps keep the CLT board informed about building management, and helps residents stay informed about the CLT. This arrangement helps to guarantee that the goal of permanent affordability is met.
HOW COMMUNITY LAND TRUSTS CAN HELP PRESERVE AFFORDABLE HOUSING IN NEW YORK CITY
New York City is losing more affordable housing than city programs are creating. According to a recent report by NYU’s Furman Center, New York City lost 194,577 affordable apartments between 2002 and 2008, a decline of 16.4%. One reason for this decline is that public subsidies for most housing programs do not guarantee permanent affordability and end up with affordable units going into the private marketplace. This often contributes to neighborhood change that displaces residents and businesses without providing significant affordable alternatives for them. The housing programs in which the losses have been most significant include the city’s limited-equity coops financed by the HDFC (Housing Development Finance Corporation), the Mitchell-Lama program, and the 1-3 family homes built under the NYC Housing Partnership. Thousands of owner-occupied units have also been lost to the sub-prime mortgage crisis and foreclosures. The last remaining block of affordable housing, which houses some 400,000 tenants, is under the NYC Housing Authority, which is moving towards privatization of its units. The city’s 80-20 and inclusionary zoning programs have failed to create enough affordable units to make up for losses, and those programs fuel gentrification pressures that make the problem worse.
We propose that the City of New York establish a policy that title to the land on which all existing and newly created affordable housing is located be transferred to community land trusts. We also propose that all city owned vacant lots and buildings be transferred to a CLT and mechanisms for privately owned property to be “gifted” to a CLT also be created. We would urge state and federal governments to make similar commitments but the city can and should lead the way. There may be an advantage of having a single citywide CLT in New York City, but this should include strengthening existing CLTs or the creation of new neighborhood-based CLTs.
CLTs in New York City should be able to take title to foreclosed and distressed properties that are either vacant or occupied. With the bursting of the housing bubble, this inventory of properties is growing. These properties may be rentals, coops, individually owned, or condos. CLTs will take title to the land and lease the buildings to the appropriate entity without displacing residents if they are inhabited. CLTs must be committed to maintaining existing tenants and homeowners needing its protection as occupants. CLTs are able to define affordability to make housing units available to those who most need it, by limiting assistance based on the median income of the census tract where the housing is located instead of the HUD-defined Area Median Income (AMI). They would promote immediate occupancy of vacant units.
CLTs can be adopted by existing non-profit housing developers and community-based organizations. They will require durable partnerships involving government, communities and non-profit developers. A community-based CLT is better equipped to monitor compliance with affordability requirements than public agencies or private financial institutions.
CAN IT WORK IN NEW YORK CITY?
There are some 200 CLTs in the nation and the number is growing rapidly. New York City has three functioning CLTs: Cooper Square and RAIN in the Lower East Side, and the East New York CLT. They have functioned successfully for two decades and received support from the city’s housing programs. The Cooper Square CLT leases over 300 units to the Cooper Square Mutual Housing Association which is in the process of becoming a limited-equity cooperative. The average Cooper Square apartment has been fully renovated and rents to tenants making less than 40% of the Area Median Income.
The CLT model can be dramatically expanded in New York City; support from city government would be a great help. The CLT model can also work if private investors holding distressed properties gift the land to CLTs instead of allowing it to deteriorate further or selling it far below market price to yet another investor who might be unable to guarantee affordability. A citywide CLT could be an option to facilitate property transfers as long as it is undertaken with the participation of neighborhood advocates for the preservation of affordable housing.
Here we present a few possible examples of how CLTs can work in New York City:
Vacant lot owned by bank or the city, investment corporations, etc. A bank or investment group owns a vacant lot that was originally taken by the city on a tax lien. The land is gifted to a CLT or purchased with support from the city. The CLT develops the land in partnership with a non-profit developer.
Vacant building owned by bank or the city, investment corporations, etc.
Distressed rental building. Investors who bought a rental building during the height of the real estate bubble face bankruptcy and tenants are struggling with inadequate management. The land is gifted to a CLT or purchased with support from the city. The CLT leases the building to a tenant’s association or limited-equity coop run by residents.
Foreclosed property owned by banks, including single-family and multi-family buildings. Homeowners and tenants facing eviction because they cannot afford even a re-structured mortgage can be protected by title transferred to a CLT. A CLT, working with legal defense lawyers, negotiates purchase of the land and leases the unit or units to the homeowner at an affordable price, with resale restrictions.
Limited-equity coop with some owners pressing to go private. A CLT assumes title to the land and leases the building back to the coop with resale restrictions. The CLT guarantees that the building will remain affordable in perpetuity.
Homes That Last – a guide from the Ford Foundation to shared-equity housing models, such as community land trusts, that fall “in between rental housing and traditional homeownership.”
: PART OF THE SOLUTION
