Objective

To determine whether the New York City Department of Housing Preservation and Development and the New York City Housing Development Corporation effectively oversee the awarding of senior housing units and a program assisting senior homeowners. Our audit covered the period from January 2014 through September 2022.

About the Programs

The New York City (NYC or City) Department of Housing Preservation and Development (HPD) is the nation’s largest municipal housing preservation and development agency. Its mission is to promote the quality and affordability of the city’s housing and the strength and diversity of its many neighborhoods. The NYC Housing Development Corporation (HDC) is the nation’s largest municipal housing finance agency and seeks to increase the supply of multi-family housing, stimulate economic growth, and revitalize neighborhoods by financing the creation and preservation of affordable housing for low-, moderate-, and middle-income New Yorkers. HPD and HDC work together to administer various programs to assist in the development and rehabilitation of housing for senior citizens, including the Senior Affordable Rental Apartments Program (SARA Program), federal Section 202 Supportive Housing for the Elderly Program (Section 202 Program), and the Senior Citizen Homeowner Assistance Program (SCHAP). For purposes of this audit, we selected for review four developments assisted through the SARA Program – HANAC Corona Senior Residence (HANAC) in Queens, Serviam Heights LLC (Serviam) in the Bronx, Victory Plaza in Manhattan, and Woodlawn Senior Living (Woodlawn) in the Bronx – and one development assisted through the Section 202 Program – Bensonhurst Housing for the Elderly (Bensonhurst) in Brooklyn.

Key Findings

HPD and HDC need to do more to effectively oversee the awarding of senior housing units as well as their senior homeowners’ assistance program. Despite the scarcity of affordable housing for seniors, we found several instances where senior housing units were left vacant for long periods of time.

• Six apartments at HANAC were left vacant for an average of almost 3 years; two of the six apartments were fully furnished apartments designated for homeless applicants.
• Only 15 of Woodlawn’s 80 apartments were awarded as of July 2022, approximately 7 months after they became available and had a list of potential tenants. The other 65 apartments remained vacant despite a waiting list of 12,050 applicants. We note that 24 apartments were reserved for homeless individuals; however, only 11 homeless apartments were leased as of July 2022.

In addition, senior housing units were not always awarded to the correct applicants. We found that six applicants at three developments were awarded apartments even though there were other applicants who should have been considered first. One of these developments – Bensonhurst – was using waiting lists that contained significant inaccuracies.

For SCHAP, which provides loans to homeowners for home repairs, we found several instances where program requirements were not being met. For instance, we identified four properties that had outstanding violations at the time homeowners received SCHAP loans; however, the violations were not remedied as required. As of June 2022, these properties had 163 open violations, including an immediately hazardous violation issued in May 2019 for mice infestation. Additionally, HPD did not effectively monitor efforts by the Parodneck Foundation for Self-Help and Community Development, Inc. (Parodneck) – the entity HPD selected to administer the program – to enforce loan repayments for recipients who had defaulted on their loans. For example, HPD did not attempt to collect loan repayments from the beneficiary of a borrower’s estate until about 2 1/2 years after Parodneck notified HPD that the borrower had passed away.

Key Recommendations

To HPD:

• Take appropriate actions, including periodically reviewing rent rolls/vacancy reports and coordinating with managing agents, to identify and promptly fill vacant apartments.
• Work with Parodneck: to follow up with SCHAP loan recipients to ensure they meet program requirements; and to take appropriate remedial action, including collecting amounts owed from borrowers who default on their loans and ensuring that outstanding violations are resolved.

To HDC:

• Review waiting lists and increase oversight of marketing/managing agents to ensure applicants are selected in the correct order for receiving apartments or removed from waiting lists if they are no longer eligible.