Issue Position: Protecting the Character of Our Neighborhoods: A Strategy on Displacement

Issue Position

OVERVIEW:

As an elected official who represents parts of Harlem and the Bronx, Adriano Espaillat has witnessed first-hand the damaging impact that gentrification can have on the residents of traditional working class immigrant, minority and ethnic neighborhoods. As large American cities, like New York have become safer and more appealing places to raise families, many tenants, particularly members of immigrant and minority communities, can no longer afford to live in the neighborhoods that their families and neighbors have called home for decades.

Displacement occurs when an influx of capital and higher-income residents force out residents already living in a gentrifying neighborhood. This disproportionately impacts people of color. As of 2010, Harlem, perhaps the neighborhood most closely associated with African American culture and history, became a majority white neighborhood. In Fort Greene, the population of white residents increased 13% between 2000 and 2012 while the percentage of African American residents decreased 15% during that same period. In perhaps the most startling example, from 2000-2011 the population of white residents in Bedford-Stuyvesant increased 633% while the population of African American residents decreased from 40,000 to 34,000.

Causes of Displacement and Next Steps:

Today, New York City tenants, especially residents living in rent-stabilized units, are targeted by unscrupulous landlords who employ a menu of predatory tactics to push them out of their homes. From using over construction as a weapon to harass tenants out to allowing apartments to crumble into a state of disrepair to unfair and manipulative buyout offers, these actors and those who enable them, only exacerbate the worst consequences of displacement.

That's why the status quo is untenable. State and local governments need to become more effective in the fight against the most damaging consequences caused by displacement and level the playing field by protecting tenants. New York City's system of rent stabilization, which provides tenants with a statutory right to renew their lease at a specified increased rate, is an essential tool in combatting displacement. But neighborhoods with the largest stock of rent-regulated units are suffering from deregulation, which occurs more often in gentrifying neighborhoods. The City must be pro-active to preserve the existing stock of rent-regulated apartments in these neighborhoods and congress must be a partner.


Congress Must Act: Federal Gentrification Mitigation Zones

In order to address the vital issue of preserving neighborhoods in the face of such overwhelming forces, congress should establish federal gentrification mitigation zones supported by the federal Department of Housing and Urban Development (HUD). These neighborhoods would be identified based on their history as a working-class area, with a connection to immigrant or minority communities, where property values have increased at a certain percentage above the average for the rest of the city, and in which the pre-existing population shows signs of being displaced.

In these designated zones, the following rules should apply:

Right of first refusal for sale of residential buildings -- In order to improve the likelihood that residents within the gentrification mitigation zones benefit from increasing property values, tenants of a particular residential building within the zone should have an automatic right of first refusal any time the building owner seeks to sell that building.

HUD assistance with cooperative formation and specialized HUD-backed loans -- In order to ensure that residents are as capable as possible to exercise their right of first refusal, HUD would provide assistance and expertise with the formation of a housing cooperative composed of the tenants of the building, and assuming basic qualifications are met, provide federally backed mortgages to the cooperative to purchase the building from the owner.

Mandatory community impact statement -- Any new residential development within a gentrification mitigation zone should include a community impact statement that specifically addresses how the development would impact vital factors within the neighborhood, including its effect on the existing affordable housing stock, schools, transportation, parks and neighborhood infrastructure.

Relocation assistance through transfer tax -- Any conveyance of a residential building within a gentrification mitigation zone will be subject to a small tax (for example, between .5% and 1% of the building's sale price) that would be allocated to provide relocation assistance for any displaced residents from that building or any other residential building within the zone.

Heightened community participation -- One of the greatest concerns among residents in gentrifying neighborhoods is that they simply do not have a seat at the table as their neighborhood undergoes rapid change. Any new construction within a federal gentrification mitigation zone would be required to meet with representatives from all political subdivisions that represent the district where the building is, or will be located. In addition, developers of buildings with more than 10 units would be required to hold at least one public presentation and forum where they will share details of the plan and allow local residents to share their input.

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