NYC to Spend $2 Billion over Decade in Public-Housing AgreementHot Buzz

June 11, 2018 06:11
NYC to Spend $2 Billion over Decade in Public-Housing Agreement

(Image source from: Wall Street Journal)

New York City has united to spend more than $2 billion over a decade to settle federal prosecutors investigation into health and safety issues at the country's largest public housing authority, according to an individual familiar with the talk terms.  

The announcement of the settlement is anticipated to be on a Monday.

City officials have been involved in negotiations with prosecutors from the Southern District of New York, who began probing lead paint and else issues in New York City Housing Authority buildings several years ago.

New York City will spend $1 billion over the first four years, under the terms of an agreement in addition to what it has already promised to the agency, according to the source. For each of the following years over the 10-year term, the city will spend annually about $200 million.

During the terms of the agreement, called a consent decree, the authority will also be overseen by a federal monitor.

New York's public-housing authority oversees the equivalent of a small city, with 176,000 housing units across the five administrative districts. Over the years, the agency has suffered as the federal investment has failed to keep pace with needed mends and local politicians have shied away from bringing in more private investment. The authority now needs an estimated $25 billion in repairs, up from $6 billion in 2005.

This past winter, few of the housing authority's ancient boilers gave out, at times leaving more than 320,000 people without heat or hot water.

In addition, the city's Department of Investigation said in a report late last year that the authority had failed to conduct lead-paint inspections as required by federal rules and city laws for four years.

The report said former Housing Authority Chair and Chief Executive Shola Olatoye had submitted documentation to federal officials showing the agency had complied with federal rules for lead paint, which wasn't the case. Ms. Olatoye had said she verbally told the federal Department of Housing and Urban Development officials about the lead-paint lapses. She resigned from the agency in April.

United States Department of Housing and Urban Development (HUD) took disciplinary action against the authority earlier this spring when it checked the city's ability to spend money on major mends to its public housing stock.

By Sowmya Sangam

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