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Turn down the 600 block of West 136th Street, and the traffic quiets. The buildings on this block are stately—columns at the entrance, elaborate floral pediments over the windows, swirling iron fencing on the fire escapes. Building 601 stands out from the rest because of the ornate cast-iron gate over its front doors. A detail like this seems like it might belong to a co-op on Park Avenue with a doorman and a valet. But this building is a co-op of a different kind—a Housing Development Fund Corporation, sold by the city directly to tenants in order to provide an opportunity for homeownership to low-income New Yorkers. Walk farther down the street, and you’ll encounter another, at 607, and then another, at 611. All told, this block houses six HDFCs, a total of 141 units of affordable housing. It isn’t just this block, though. Our own Community District 9, made up of Hamilton Heights, Manhattanville, and Morningside Heights, is a hotspot for these buildings, home to about 150 buildings of some of the most affordable housing in New York City.

Michael Palma, Columbia College class of 1983 and resident of 601 W. 136 St., explains to me that these apartments were originally built in the early 21st century, as the population and area of New York City rapidly swelled. Palma is a photographer with a careful eye for detail, who points out the architectural features of his building to me when I visit. He has lived at 601 for much of his life, even before it was an HDFC, traveling the twenty blocks south to Columbia for college.

In his building’s shared office, a converted apartment with high ceilings and a large circular table, Palma shows me an advertisement for the building, which describes the neighborhood as one “devoted exclusively to … the private dwellings of the cultured and wealthy.” And in the early half of the 20th century, the advertisement was spot on; the neighborhood was home to figures like W. E. B. Du Bois, George Gershwin, Thurgood Marshall, Paul Robeson, and Norman Rockwell. The advertisement trumpets “dining rooms paneled in oak” and “an unobstructed outlook onto the Hudson River.” In 1907, the lowest rent in the building was $540, equivalent to $13,720 with today’s purchasing power. So how did apartments in a building like this end up selling 30 years ago for only $250—about $534 with today’s purchasing power? Herein lies the peculiar magic of HDFCs; if the housing market of New York started as a stream, and has now become a swollen river, HDFCs are an eddy in the chaos.

HDFCs in New York City

In the 1970s and ‘80s, New York City was in dire straits. Stately buildings, once occupied by “the cultured and wealthy,” had fallen into disrepair, forfeited by landlords who jumped the sinking ships their buildings had become. The city, left with hundreds of surrendered buildings in its hands, began a program to turn these buildings over to low- and middle-income New Yorkers who could manage them directly, without a landlord. HDFC cooperatives were born. Residents of these new co-ops, known as shareholders, were able to purchase a share in the stock of their building at a dramatically reduced sale price in exchange for taking care of a building that might otherwise succumb to dilapidation.

“The building we live in was actually on the list to be demolished,” April Tyler tells me. Tyler is the chairwoman of Community Board 9’s Housing, Land Use, and Zoning Committee. She has lived in a building at West 138th Street and Amsterdam Avenue since the 1980s, which became an HDFC 28 years ago. “There was a big X on the building. You know that X for the fire department? Don’t go in there, it’s dangerous?” Before she moved in, there was no running water in the building, so the tenants filled buckets at the fire hydrants. The basement was littered with trash, and the elevator was broken. She told me that the building had a reputation—not where you bought crack, that was next door—but rather where you would go to do the crack once you’d bought it. When Sylvia Tyler, April Tyler’s neighbor, first moved in, her kitchen was littered with cocaine vials discarded by squatters. One man regularly came to her landing to shoot up heroin. “He had a terrible situation,” she said. “Every time he shot up, he pooped. Just pooped [right there].” A building like this wouldn’t be turned around overnight, but the residents were ready to buckle down and try.

A co-op of any type can be very difficult to run. The success of the building relies on each shareholder doing their part—paying their taxes, participating in board elections, maintaining their units. “It’s very hard for volunteers to manage a building ... even in the market rate world,” explains Debra Bechtel, head of the Corporate and Real Estate Clinic at Brooklyn Law School.

But HDFCs present some unique challenges of their own. Because HDFC residents are owners, not tenants, their supervising agency, the New York City Department of Housing Preservation and Development, doesn’t usually pay for building improvements. And because the shareholders are also (by definition) low- or middle-income, few have heaps of disposable income to spend on fixing up their buildings. On top of that, in many HDFCs, 40 percent of the building’s profit from a sale of any unit goes back to the city, leaving HDFCs without the resources to make improvements that most other co-ops have. This means that sometimes shareholders have to make difficult choices: With a limited amount of money, do you pay taxes or fix a creaking boiler?

Remember that broken elevator in Sylvia Tyler and April Tyler’s building? They lived in their seventh-floor walkup for ten years—3,650 days of carrying groceries, small children, and furniture up the stairs—before the shareholders finally saved enough money to fix it on their own dime.

While the Department of Housing Preservation and Development has two employees to assist HDFCs, the 1,087 such buildings across the city keep them thinly spread. The HDFC Coalition, of which Michael Palma and Sylvia Tyler are members, was formed in 1992 to advocate for HDFCs where the city fell short.

Sylvia Tyler in her home on West 138th Street and Amsterdam Avenue

Today, thanks to the immense efforts of April Tyler, Sylvia Tyler, Michael Palma, and their co-shareholders, their buildings are all in good health. But not all HDFCs share this narrative of success. While the majority are doing well financially, about 20-25 percent of HDFCs owe $2000 or more per unit in taxes, according to estimates by the Urban Homesteading Assistance Board. In the last two decades, 74 HDFCs across the City were foreclosed. Last year alone, 77 HDFCs, or 1779 units total, were placed on a list for potential foreclosure. Today, eight buildings in Community District 9 with a collective appraised value of $70 million are shouldering massive debts to the city that could result in foreclosure.

In recent years rising housing prices and gentrification have permeated New York, a process only augmented in Community District 9 by Columbia’s development of Manhattanville. Blanca Vazquez, a longtime HDFC shareholder, has witnessed this effect personally. “I’ve lived here since 1979, I’ve seen waves of gentrification, but nothing like this one. This is huge capital.” According to NYU’s Furman Center, from 1996 to 2006, Community District 9 saw sales prices increase by 398.7 percent, a rate second only to that of East Harlem. The foreclosure of HDFCs and subsequent conversion into private housing stand to magnify this effect.

When an HDFC is foreclosed, it goes into a program called Third Party Transfer, where the building is turned over to a third party developer. This conversion has the potential for massive gains to such developers. “As long as they keep 20% of the building affordable, the mortgage is forgiven,” says Glory Ann Hussey Kerstein, another longtime HDFC shareholder and former HPD employee. One building at 220 W. 116th St. has sold three times in the past six years—for $8.8 million in 2012, for $15.4 million in 2014, and then for $17.3 million in 2015. Meanwhile, the former shareholders lose their equity and are converted to rent-stabilized tenants. Open units can be rented at market rate, reducing the stock of affordable housing. Last month, a studio at 220 W. 116th St. rented for $2,050. “That is not low or moderate income. I can’t afford that,” says Hussey Kerstein.

“The ultimate question here is who wins … from foreclosure and who loses?” Vazquez asks. “Once the building is on its path, it’s unstoppable. People will start to get pushed out.”

Luis Cordero knows what it like to stare down the barrel of foreclosure. When Cordero became a shareholder at 526 W. 158th St. in August 2012, he knew the building had some financial troubles, but he wasn’t aware of the extent of those troubles until he became the treasurer on his building’s board of directors in 2015.

Foreclosed HDFCs in New York City, 1999-2016

Nearly 100 percent of HDFC shareholders are first-time homebuyers, and therefore have no experience with the ins and outs of owning a home. According to Marina Metalios, director of training and client services at the Urban Homesteading Assistance Board, the accountability of owning a home can feel foreign to new shareholders. According to Cordero, shareholders in 526 W. 158th St. struggle with perennial feelings of powerlessness—“most of them don’t speak English or are afraid to ask questions or get help for anything.”

Managing an HDFC means navigating complex processes, a bureaucratic Bermuda Triangle of sorts. According to Cordero, “[it’s] not because they don't want the help, it’s that it’s hard sometimes to get to the city people when you don’t speak the language or you don’t know where to go.” Even those with the best intentions can hit massive unforeseen obstacles.

Here is where Columbia comes in.

In 2009, President Lee Bollinger and the West Harlem Local Development Corporation signed the Community Benefits Agreement, a document in which Columbia makes a commitment of $150 million in grants and services to help “sustain a vibrant West Harlem community.” This agreement is meant to alleviate the shockwaves that the Manhattanville expansion would inevitably cause in the surrounding community. Twenty million of that $150 million has been allocated specifically towards an affordable housing fund.

The WHDC (the WHDLC shortened its name to “West Harlem Development Corporation” in 2011) serves as a sort of middleman between Columbia and the community, distributing the funds pursuant to the guidelines set forth in the CBA. For HDFCs specifically, the crucial passage of the CBA is Section 3, Article O, which says that some of the funds could be used to create and maintain an HDFC Resource Center. According to the CBA, “The center would provide education, advocacy, information and technical assistance to CD 9’s HDFC cooperatives and other properties.”

But this never really ended up happening. Up until last year, the extent of the WHDC’s involvement with HDFCs was limited to funding a general housing advocacy group that occasionally holds classes for shareholders. Though the WHDC has more HDFC programs in the works, current shareholders seeking education, advocacy, and support must rely on the city, a few concerned groups, and each other. And for some who are struggling, this just isn’t enough.

Graphic by Isabel Wong

When a building is first turned into a co-op, the HPD provides a training course to teach the shareholders how to run their building. Although some say the training has gotten better in recent years, shareholders from the first wave of HDFCs, like Hussey Kerstein, remember it being “paper thin” and “basic.” Over the course of several decades, many issues crop up that poorly trained shareholders are unequipped to handle.

In an HDFC, the board is supposed to collect maintenance fees and use them to pay taxes on the building. But raising these maintenance fees is a touchy subject for shareholders of modest means. “Affordability to me means keeping my maintenance affordable,” Palma explains. The board, reluctant to raise the maintenance fee, may face a deficit that leaves them unable to cover their bills. Because notices of unpaid taxes are sent exclusively to the managing agent, the other shareholders may not be aware that they are in arrears. According to Matthew Maline, an attorney with extensive experience with HDFCs, “they could get that information, but a lot don’t know they have the right to ask for that.”

According to an HPD Spokesperson, “HPD is fully supportive of putting struggling HDFCs back on track and will continue working diligently with the community to address the challenges HDFC co-ops face.” And it is true that UHAB has been able to arrange payment plans with HPD to get shareholders out of arrears. While HPD has two employees devoted to assisting HDFCs, the 1,087 HDFCs across the city keep them thinly spread. Many shareholders have been disappointed with the support HPD has provided. According to Maline, the city makes it “very difficult” for shareholders to get information about water and sewer. Information on tax arrears is also elusive.

“The process for foreclosure is murky, lacking in transparency, [and] not comprehensible,” Hussey Kerstein said at a recent forum at Theater for the New City on the Lower East Side. “Technically, HPD can begin foreclosure after four quarters of non-payment. The average nonpayment property arrears for these buildings is ten years.” The massive accrued debts of ten years pose a formidable challenge. Those debts are magnified by staggeringly high interest rates that compound daily. “Once [HPD] waits until they owe a million dollars, between property taxes and water and sewer, that’s not really something that the low income people in these buildings are ready to face,” explains Maline.

An HDFC at 616 West 137th St.

But the stakes in this fight to preserve HDFCs are too high to brush aside—not just for shareholders, but for our whole community.

Data from New York University’s Furman Center paints a sobering picture of inequality in New York City homeownership by race/ethnicity and income. Based on data collected between 2010 and 2014, only 7 percent of Hispanic residents and 9 percent of black residents owned their homes, compared to 33 percent of white residents. In Community District 9, median household income in 2016 was $49,993. The median household income for homeowners in Community District 9 was $102,983 that year.

According to estimates by Urban Homesteading Assistance Board, about 85 percent of shareholders in HDFCs are people of color and nearly 100 percent are low- or moderate-income. These HDFCs provide a rare and precious opportunity for people who otherwise might not be able to own a home. “I will say that despite the fact that it is easy to criticize NYC government, there is no government that does what New York does around this issue,” Metalios tells me.

Beyond losses to individuals, the negative effects of HDFC foreclosures have the potential to ripple through the community. Like Palma, many shareholders have owned their units for several decades, providing a backbone for the neighborhood. Only about 14 percent of HDFC units have ever been resold; the annual turnover rate is about 1 percent, compared to 15 percent on average in the rest of the city.

The shareholders I met while reporting this story were community activists, teachers, and artists. They ran community gardens and spearheaded projects to develop parks in the neighborhood. Many of the units in their buildings went to families. They had Halloween parties in the community rooms of their buildings so that neighborhood kids could enjoy themselves without the threat of pop guns and raw eggs. They take great pride in the community they’ve built in their neighborhood. As Palma put it, “Once you own where you live … you take care of your building more, and once you have the building, you project out into the neighborhood.”

Inside an HDFC unit at 1580 Amsterdam Ave.

There are members of the community who won’t let HDFCs go under without a fight. Hussey Kerstein and Vazquez—both well-acquainted with the difficulties of running an HDFC—are members of the HDFC Coalition’s Anti-Foreclosure Committee. The HDFC Coalition, of which Michael Palma and Sylvia Tyler are also members, was formed in 1992 to advocate for HDFCs where the city fell short. Its Anti-Foreclosure Committee helps struggling buildings fill out applications for Article XI tax amnesty, a process that could result in the exemption of arrears from a building. When I spoke to them, the Anti-Foreclosure Committee had visited 30 HDFCs in foreclosure. At some of the buildings they visited, the shareholders weren’t even aware they were in foreclosure. “It’s this huge wakeup call,” says Vazquez, “For many buildings, it’s our notice on front door that told them … it’s an emergency situation.”

The Anti-Foreclosure Committee had helped prevent 12 HDFC foreclosures, preserving the shares of some 342 families. Vazquez is adamant that shareholders can mobilize to save their buildings before it is too late. “People start to reorganize themselves, they wake up. … It’s that kind of energy and volunteer effort, and people are stepping up to the board.”

When I ask about the success of his own HDFC, Palma says, “[We have] a sense of cooperative living, when everyone understands that they are shareholders and not tenants, [and] understands that they have to cooperate with each other in order to have a successful building.”

The shareholders at 526 W. 158th St. also refused to go under without a fight, and rallied to save their building. Cordero, who works as a bus driver, says most of his vacation days are spent attending meetings for shareholders, trying to learn as much as he can to get his building back on its feet. “We kept pushing, we kept knocking doors, and if you don’t open it today, I'll be back tomorrow, knocking again,” he says. The shareholders sought help from the HDFC Coalition and from Councilmember Mark Levine and his staff to fill out the Article XI paperwork. The paperwork should go through this November, and they are hoping the exemption will allow them to pay down the debts enough to secure a loan for the rest of the arrears.

Cordero is quick to dole out credit for the many people who helped his building. “Even when I felt like I wanted to give up, I would call Glory Anne and she would be the first fighter that said, let’s go.” He has high praise for Levine, for other community members who have devoted their time to helping HDFCs, and for the new manager in his building. “In a year and a half, between all these people, I gotta say thank you. We got it done.”

Debra Bechtel is also optimistic about the outcomes of assisting HDFCs. At the Corporate and Real Estate Clinic at Brooklyn Law School, she supervises a team of eight to ten law students that conduct pro bono legal work for HDFCs. The clinic has had great success, closing millions of dollars worth of loans arranged by UHAB each semester to get HDFCs out of arrears. “Usually if they get the right help early enough, they can pull it off,” she told me. “A combination of assistance, from sometimes a lawyer, sometimes a manager, sometimes technical assistance. … Most of them need all three.”

While separate organizations have done a good job of increasing shareholder knowledge through educational forums and personal assistance, there is no central database where any HDFC can find information for everyday operation. “There are hubs probably,” Metalios says, “but there is no ombudsman that I know of.”

Sylvia Tyler in her home on West 138th Street and Amsterdam Avenue

This gap coincides with a shift in the WHDC’s strategic plan. In its first nine years, the WHDC has focused primarily on providing grants to outside nonprofits. However, according to Executive Director Kofi Boateng, the WHDC now plans to look inward and devote more of its budget to in-house programs. So although the WHDC has provided funds to the more general housing advocacy group PALANTE, this turn inward allows for more targeted programs created and managed by the WHDC itself.

The WHDC’s past efforts to address affordable housing have hit a huge obstacle: The cost of new development is exorbitant, and becomes even higher with every passing day, making it difficult for the WHDC to build new units that will necessarily be priced under market rate. “We’ve been, from day one, trying to do real development to add to the permanent stock of affordable housing. And we haven’t succeeded, not for lack of trying, but precisely because the very presence of Columbia has built up the price of land,” Boateng explains, “The $20 million is finished before I even put one brick on it.”

So recently, the WHDC has been looking for other ways to address housing while efforts to buy land are stalled. “We’re in the community, so people come to talk to us,” Boateng says. As a result of meeting with leaders from Community Board 9, the WHDC has begun more intensive efforts to help HDFCs over the last year and a half. Boateng stressed to me that these efforts did not mean paying off arrears. “If there are ten of them and everybody owed half a million dollars, that’s five million dollars, and the word gets out and you have another group of ten that comes, then pew! Your money is gone, and that’s not the purpose of the Benefits Fund.” Instead, Boateng says they would like to help HDFCs help themselves. “We have to find a comfortable space where we are providing them direction, more like technical assistance, to direct them to other places where they can get help.”

Boateng at first expressed reservations about creating a center. “Whoever wrote it is picturing one physical space,” Boateng told me. “Resource can be a center, or the activity, and we’ve chosen to focus more on the activity.” But the creation of an HDFC Resource Center may just require a more expansive view of what such a center could be. When asked about the feasibility of an online database accessible to shareholders, Boateng says, “Yeah, we can do that. That’s easy enough.” If such a database was combined with centralized access to services—both to the WHDC’s own and to those of groups already working to preserve HDFCs—the WHDC would be well on its way to providing the “education, advocacy, information and technical assistance” that the CBA’s proposal for an HDFC Resource Center suggests.

Executed well, such a center would not impinge on the independence of HDFCs, but rather would make it easier for shareholders to educate themselves on how to manage their buildings. According to Hussey Kerstein, “Having an HDFC Resource Center in West Harlem would be an excellent template for other communities to have a one-stop shop to provide shareholders the means they need to strengthen their homeownership.”A resource center could facilitate the combination of assistance that Bechtel finds so influential in a building’s success. It could help connect struggling shareholders to organizations like the HDFC Coalition Anti-Foreclosure Committee and UHAB that can help them secure loans or fill out Article XI paperwork. It could provide instruction on how to find the elusive water and sewer information that Maline mentioned. Perhaps, most importantly, it could empower shareholders like those in Luis’ building to take initiative in their building before they are thousands of dollars in debt.

Such a center may be closer to fruition than one would think. When I asked various HDFC housing advocates about the viability of such a center, several expressed interest in being involved in its genesis. The WHDC has already instituted a program called the West Harlem Homeownership Assistance Program, which lends residents of newly created HDFCs the money to buy their units at zero interest. They continue to have meetings with community leaders about how to proceed on the front of HDFCs. “The problems weren’t created overnight, so we don’t pretend to solve them instantly,” Boateng says. “We’re trying to collaborate … to get different pieces going in the same direction.”

Correction October 2, 2018: An earlier version of this article misspelled Blanca Vazquez’s last name as Vasquez. The Eye regrets the error.

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HDFC Housing Development Fund Corporation CD9 Community District 9 CBA Community Benefits Agreement WHDC West Harlem Development Corporation UHAB Urban Homesteading Assistance Board co-op affordable housing Kofi Boateng