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Bonds bombshell killing projects

for The Brooklyn Paper
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A shortage of federal money designed to spur the development of affordable housing may endanger up to 3,000 lower-priced apartments in Downtown Brooklyn. But what exactly is going on? Let The Explainer explain:

How does the process work?

A developer who includes affordable units in his or her development can apply to the city or state for tax-exempt bonds.

How many bonds are available?

Developers in New York State are seeking $6 billion to $7 billion in such bonds this year, yet only $1.6 billion is available.

Why such big demand?

Partly because developers know they can circumvent some neighborhood opposition by including below-market-rate units. Also, several Bloomberg administration initiaives gave more incentives for developers to build affordable, thereby putting further strain on the system.

Didn’t Ratner promise 2,250 affordable units at Atlantic Yards?

Yes.

What will happen to the units if the bonds aren’t there?

Some of them won’t get built.

Can Bruce Ratner really back away from that promise?

Yes — with no penalty.

Correction

An earlier version of “The Explainer” inaccurately reported that Atlantic Yards developer Bruce Ratner must pay a $500,000 penalty if 50 percent of the project’s rentals are not below-market-rate units. In fact, under the Community Benefits Agreement, there is no penalty if Ratner does not build the units. The corrected copy appears above.

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Reader Feedback

Norman Oder says:
The claim about ACORN is untrue. See:
http://atlanticyardsreport.blogspot.com/2006/09/affordable-housing-timing.html
Feb. 27, 2008, 9:03 pm

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