Letter to Shaun Donovan, Director of the Office of Information and Regulatory Affairs - OMB Should Waste No Time Approving The Terms & Protect Middle Class Families

Letter

Dear Director Donovan:

The Penn South co-op was built in 1962 in the Chelsea neighborhood of New York City and for over five decades has served as a residential haven for low- and moderate- income tenants and families. Not only have the buildings that make up Penn South offered affordable housing to thousands of New Yorkers, but the entire development continues to provide a safe and beautiful community to all of the tenants and the broader neighborhood. These are the types of housing developments that are critical to serving the affordable housing needs of dense urban communities, like those in New York City, and will continue to require our commitment and attention. It is in this vein that I write to you to ask for your attention and strong consideration of the Penn South co-op's efforts to secure refinancing which would ensure that the development remains affordable for an additional 22 years.

The opportunity to guarantee another two decades of affordable housing in this neighborhood is one that we cannot let pass without serious and diligent consideration. We simply cannot run the risk of failing to guarantee that the 2,820 units of affordable housing in this development will continue into the future. As you are aware, the high cost of housing and low vacancy rate in New York City has burdened many families. If these units were no longer kept affordable and were to dramatically increase, families would face significant financial hardship, and the stitches that bind that community would begin to unravel.

I am grateful that HUD, the lender, the Co-Op, and the City of New York have all worked cooperatively to negotiate an agreement that would keep this property affordable. However, a sense of urgency is necessary to work out and approve the refinancing of this loan. As you know, as part of the refinancing agreement the current affordability provisions would remain in place for the full 35-year term of the HUD loan. More immediately, Penn South would be able to reduce its current debt payments and lock in current interest rates, which would eliminate the risk of rate increases over time.

In just the past few decades, New York City has lost over 250,000 affordable apartments as the demand for affordable housing only continues to grow. The Penn South community has shown how essential this development is to the fabric of New York City. The property has been well managed and well maintained for years, but the refinancing agreement should also help to ensure that current and future repairs will be able to be made going forward -- allowing Penn South to maintain its character and prominence in the neighborhood well into the future.

Given all of this, I urge you and your team to work with the other parties to carefully and diligently consider the terms of this agreement and make the necessary determinations as quickly as possible. Thank you for your time and attention to this matter and your continued efforts to promote affordable housing for New Yorkers.

Sincerely,

U.S. Senator Charles E. Schumer

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