Perhaps more than any other, housing is a central issue to New Yorkers. And with real estate prices remaining at record highs in the city despite a struggling economy, a packed room of people gathered to hear City Housing Commissioner Shaun Donovan discuss "Affordable Housing and the Future of New York" at the On/Off the Record Breakfast on May 18. From the massive increase in housing construction during the Bloomberg administration to why the current housing crisis presents a prime opportunity to change the country's and the city's approach to housing, Donovan addressed a wide range of topics related to housing.
Following are selections from the edited transcript.




Q: There's a sense these days that affordable housing is rarer than before. What are people who feel this way missing that you see?

A: Well, first of all, as the mayor often says, this is a good problem to have. The fundamental problem that we have in affordable housing today is the problem of the success of New York City. The city is growing. People from all over the world want to live here, and that's driven up housing prices. There's no question, when the mayor came in 2001 right after 9/11, he put together a housing plan that was a five-year, 65,000-unit housing plan. Over the first few years of the administration, housing got less affordable. There's no question. Part of the problem is even when you start a major investment in housing, it takes a few years to actually see those units come online. ... In fact, we have more subsidized housing today than we did when the mayor came into office. The real issue is that a market rate unit that was previously affordable to a low or moderate-income person, because of the pressure in the market, got more expensive.




Q: Is the legal definition of affordable housing correct, or do you think "affordable" should mean something else?

A: I often get this question from elected officials and community folks who say, "This is the standard for New York City and the whole metropolitan area, and it includes suburban areas. The income in my community is much lower. Shouldn't you use my community's definition of affordable housing rather than some national standard?" The truth is, Congress sets this standard, HUD has a definition they use for the entire country, it governs all the federal programs, and it would be impossible to just administratively figure out a system where every singe neighborhood had a different system, and try to get Congress to pass that. But what we can do-and this is what we do-we're not tied to some particular definition of affordability from the federal government. We have and we've created the flexibility to vary our programs with a whole new set of resources-the Battery Park City Housing Trust Fund, a whole range of things that we've done under the Bloomberg administration to make our programs more flexible. So when we sit down in front of a community board or an elected official to say, "Let's talk about what this community needs," we can get units at the very lowest income, below 30 percent of median income for the whole city. We can get units that are middle-class units. We can vary those in away that work for that community-despite the fact that there's this national definition out there.



Q: Do you think there's enough of an understanding in Washington of why New York needs the kinds of investments that you want them to adopt for New York?

A: I guess I would enlarge the question a little bit. I think the fundamental challenge has been to demonstrate to the American people that they know affordable housing is important. What they don't necessarily know is that government knows how to do it right. ... The truth is, when affordable housing works, it's almost invisible. We're doing today, and lots of folks in this room are doing mixed income developments. We have a project that is moving its way through the approval and construction process right now in the Bronx that will combine market-rate condominiums with supportive housing with the formerly homeless. We are combining and integrating market-rate and affordable housing in a way that nobody would have thought possible a few decades ago. And, frankly, it means that we have to get out and tell the positive story, because a lot of folks don't even know that there's affordable housing in that building or that it's part of their community. The image that remains is this old outdated image of public housing that failed. We've got a lot of work to do to explain the advances that we've made and what we've learned and to demonstrate that yes, in fact, we will use taxpayer dollars wisely in terms of rebuilding. I think there is an opportunity, given the subprime crisis. A mentor of mine that I worked for in my first government job in Washington said, "A crisis is a terrible thing to waste." In fact, we have an opportunity, despite the terrible things that are happening in neighborhoods because of the subprime crisis, to really reframe the housing challenges, nationally, as a result of what we've seen over the last few years. Housing is on the national agenda again maybe for the first time in a generation. We have an opportunity, I think, to really utilize that to reframe the issue.




Q: Can you estimate how many housing units the city will need at certain years?

A: If you look back, in the 1990s, the city grew by over 400,000 people. We only added. All the units that got housing permits to be built in the 1990s, the total over those ten years was about 75,000 apartments. You do the math. 75,000 apartments aren't going to fit 400,000 people or anywhere near it. So we entered, when the mayor came into office, with a big housing deficit. Simply put, we didn't have enough housing for the people that were here. We probably need about 100,000 units to make that work. Add to that the million people we expect to add to the city by 2030, and even subtracting the units that are under construction today but haven't been completed and occupied yet, we need about an additional 265,000. In total, we're talking about over 350,000 units to the city to accommodate our growing population by the year 2030. In fact, what we did in PlaNYC, we went neighborhood by neighborhood and figured out where could those go and what we needed to do, whether it's rezoning, whether it's adding transportation capacity, whether it's decking of rail yards and highways-a whole range of things to accommodate that growing population. We came up with places where we though we could build up to 500,000 units. The private market is not going to respond to every one of those opportunities. But we think within those 500,000 units of housing opportunities we can likely get the 365,000 units that we need.




Q: Is it possible to get 365,000 new units in the next 22 years given the rate of construction?

A: In fact, it's very achievable. Over the last three years, we've seen a dramatic boom in housing construction. ... We've seen more than 30,000 permits each of the last three years-never happened before in the history of keeping these numbers. We've only had one year ever that was more than 30,000 permits. That's a great start, but we don't need to keep this pace to sustain that level. Just do the math. We could probably be at half of that level of construction on average and still get to that 365,000 units.