[NYtenants-online] New Towers, Old Tenements 1/17/02
Thu, 17 Jan 2002 11:13:00 -0500
NYtenants Online/TenantNet 1/17/02
IN THIS ISSUE ...
New Towers, Old Tenements
Friedman Steps In
Memorial for Julie Lobbia
HE CERTAINLY HAS BIG SHOES TO FILL. With this week's Village Voice,
reporter ANDREW FRIEDMAN steps into the void left when 'Towers and
Tenements' columnist JULIE LOBBIA passed away last Thanksgiving Day.
Her family, friends and colleagues lost a sister, a buddy, a co-worker. To
those of us who knew Julie in connection with her work on 'Towers and
Tenements,' we lost arguably the best investigative reporter in New York
City (which was only reinforced when the Real Estate Paper of Record -- the
New York Times -- failed to acknowledge her passing). We also lost a quiet,
passionate & effective activist. Julie was known to help a number of
distressed tenants outside of her reporting. We lost a person who set
standards, who understood the subject matter, who performed due diligence
and who was articulate and accurate in her reporting. For information on
the Memorial Service, see below.
What the other papers never seem to understand is that it's not only the
intrigue of the machinations and manipulations (some might say mutilations)
of the zoning and housing codes, or the political calculus and chicanery.
That's fodder for goo-goo's and Andrew Klutzman junkies. What is important
is the IMPACT on the personal level and on the broader level, the
development of public policy and how communities live and die.
We have collected various remembrances of Julie and placed them on
All this is why Andrew Friedman is fully aware of the tenant and
neighborhood communities' expectations. For right now, Towers and Tenements
is expected to appear every other week. His first column under the T&T
heading is reprinted below, exposing the impact on tenants of former
Housing Secretary (and now NY gubernatorial candidate) Andrew Cuomo's HUD
Friedman is not new to housing issues, having written for the Village Voice
for the last eighteen months and prior to that, the Long Island Voice. Like
Julie, he also worked at various papers in the Midwest -- Cincinnati, Grand
Rapids and Chicago.
While continuing Julie's work exposing landlords and real estate scams,
Friedman hopes to examine issues relating to how real estate policy is
determined (or not determined).
We are hopeful that Andrew Friedman will wear the shoes well. He may be
contacted at firstname.lastname@example.org
A MEMORIAL SERVICE FOR JULIE LOBBIA will be held on Saturday, February 2 at
2 P.M. While the service is open to the public, including tenants who
appreciated and were affected by Julie's work, the family has requested we
not post the location in a public notice -- only because the location is
not that huge.
For those who would like to attend, please send an email to
email@example.com and IN THE SUBJECT LINE OF THE EMAIL put in the words
"Lobbia Service" (of course, without the quotes). We will email the
location to all who request it.
A GATHERING OF JULIE'S FAMILY, FRIENDS AND COLLEAGUES:
A free form memorial service with music, pictures, garlic,
red wine and an open mike -- let's call it "Spinning for Julie."
Date: Saturday, February 2, 2002
Towers & Tenements
Village Voice, January 16 - 22, 2002
by Andrew Friedman
AFTER ARRESTS IN THE HUD SCANDAL, WILL ITS VICTIMS LOSE THEIR HOMES?
Sekou Traore thinks his bad luck started in 1996, when he returned home to
Mali for a visit. In the year he ended up staying there, he lost his
passport and tore up his leg in a motorcycle accident. When he returned to
Harlem, where he has lived for 17 years, he found out his wife had left
him. Soon after, he lost his apartment. He found a new home in the summer
of 1997, in a single-room-occupancy building at 74 West 131st Street,
sharing a room with his cousin, Zibo Bedia, a bike messenger. He thought
his luck had finally changed.
Over the years, Traore has worked as a florist and as a salesman, a far cry
from his teenage years running a 40-ton drill for a French oil company. He
is barely employed, in poor health, and eking out a living translating for
immigrants. As luck would have it, his current residence has been caught up
in one of the most staggering federal housing frauds in recent memory.
The scam has ravaged about 470 buildings across Harlem and Brooklyn and 30
in the Bronx and Queens since 1998, and hasn't received anywhere near its
due public outcry. Taxpayers are currently bailing out the more than $70
million in government-backed loans that lined the pockets of the real
estate speculators, mortgage lenders, appraisers, lawyers, and nonprofits,
an extraordinary number of them from Long Island, who perpetrated it.
Generally, the scam worked like this: Speculators bought distressed
buildings, many filled with poor and working-class tenants. Then the
speculators recruited churches and nonprofits with no experience in
developing housing and showed them how to secure 203(k) mortgage loans
backed by the U.S. Department of Housing and Urban Development to buy these
buildings at hugely inflated prices. The loans are meant to provide money
for ordinary people to purchase and rehab vacant buildings for affordable
housing. Only the catatonic state of Andrew Cuomo's HUD administration can
account for why the unqualified nonprofits obtained the loans.
Appraisers in on the deal signed off on the bloated prices for knowing
mortgage companies who loaned the money and then dumped the mortgages on
the open market. The cash disappeared, and the nonprofits defaulted. Law
enforcement officials say the nonprofits often got kickbacks of $5000 a
building, and closed the loans with funds from the crooked developers,
violating HUD rules.
So far, 33 people have been arrested in the case and 19 have pleaded
guilty. In December, six defendants connected with the Helpline Soul Rescue
Ministry in Brooklyn negotiated a settlement with Attorney General Eliot
Spitzer's office to pay $226,500 into a restitution fund for tenants. The
lawsuit charged that Helpline had acted as a front in the purchase of 65
buildings in Brooklyn and helped skim more than $2 million in loan money.
But the complexities of the scam make it easy to lose sight of the fact
that these rogues left 1500 families marooned in more than 250 buildings.
Once the suburbanites had the buildings in their clutches, they just walked
away. The tenants who were left suffering in the dark and cold in
deteriorating housing are a snapshot of New York's poor and working
class—MTA workers and bike messengers, peddlers and ragpickers, nurses and
moving men. For more than a year, all across upper Manhattan, central
Brooklyn, Queens, and the Bronx, they seem to have been completely
forgotten. In order to get by, they developed their own strong
associational networks and went to work.
"That year was terrible," Traore says. "We had to do everything ourselves."
At a brownstone at 3 West 119th Street, 62-year-old Tony Hobson led a fight
to clear his building of the lead-pipe-wielding troublemakers who were
using it as a crack house and crash pad. Tenants pooled their money to pay
off a $5000 Con Ed bill to keep the lights on. They bought supplies that
handyman resident Lawrence Jones, 59, used to install toilets, light
fixtures, and bulbs. He paneled the walls himself, fixed the pipes, and
painted the place a bright yellow. "We spent money here," Hobson says, "in
order to survive."
"We want to own this building," says Traore, back in 74 West 131. " We have
to seek some advice first to see how we can borrow money to takeover the
building and self-manage it so everybody can stay in their rooms."
Ironically, though, tenants have commonly been the last to know their
fates. When the scandal broke, Hobson heard it on the streets. Now that the
authorities are starting to retake the buildings—HUD holds about 200 so
far, and is foreclosing on the rest—the situation is just as frustrating.
After all the value they put into these buildings in money and sweat,
residents have understandably balked at the demands of court-appointed
administrators demanding rent without making real repairs and saying that
any repairs must come out of the rent roll. Out-of-town HUD managers have
also rankled tenants with leases they have presented for signing.
As Hobson puts it, "How are you going to send us letters for rent when no
one's been in here to interview the tenants or fix anything? We don't mind
paying the damn rent if they get something going on over here."
Last month, with some fanfare, U.S. Housing Secretary Mel Martinez
announced a plan to rescue the 514 buildings. The feds nearly doubled their
earlier assistance offer, to $130 million, and promised that no tenants
will be displaced. The buildings will go into four programs run by the
city's Department of Housing Preservation and Development—164 buildings to
the Neighborhood Redevelopment and Neighborhood Entrepreneurs programs, 172
to Neighborhood Homes, and 178 to Homeworks.
On its face, the plan offers slim hope that tenants will be able to remain
in their buildings. While at least 250 buildings are occupied, about 300
are heading into programs designed for homeowners, not renters. Only two of
the programs mandate the inclusion of rent-stabilized apartments at all.
And it is more curious that the highest number of buildings is slated for
the Homeworks Program, which helps private developers rehab homes for sale
on the open market. Homeworks has no limits on buyers' incomes, and a 1998
round of Homeworks buildings in Harlem sold for between $350,000 and
$500,000, hardly affordable housing, although some of those prices were
inflated by the very scam that started all this. HPD officials stress that
the numbers are only estimates. They "anticipate" none of the occupied
buildings will go into Homeworks, that solutions will be handcrafted for
the SROs, and that the department will not firm up the plan until spring
"at the earliest." "The goal of our housing rehabilitation programs is not
to displace tenants," emphasizes HPD spokeswoman Kim Brown.
One of two things will probably happen to Sekou Traore and the other
tenants. If they are moved out so that the buildings can be rehabbed under
one of the city programs, their rents when they return, certain to be
higher, will be subsidized by Section 8 vouchers. More likely, they will be
permanently relocated to apartments elsewhere, again with rent subsidies.
"Section 8 vouchers will be available for eligible tenants," Brown says.
"Tenants in single-room-occupancy buildings will be provided with
appropriate housing within the neighborhood, when possible." This is not
greatly comforting news. City programs that stress returning buildings to
developers as fast as possible lack any serious provisions for
self-determination or real respect for tenancy rights in a specific
building. Terry Poe, an organizer at the West Side SRO Law Project, which
has worked with the tenants, put the matter in perspective with a question,
"Will tenants have a say in the final disposition of the buildings?"
The answer seems to be no.
The Tenant Network(tm) for Residential Tenants
Information from TenantNet is from experienced non-attorney tenant
activists and is not considered legal advice.