Excelsior! Cry Havoc and Let Slip Housing Abundance
Summary quotes from the governor, mayor, and mayor’s report
This post is a follow-on to The Enemy’s Gate is Down: the State of NYC Housing Abundance. For a fuller context of the summarized speeches that follow, please see that post.
On December 1, New York State Governor Kathy Hochul delivered a speech on her 2023 housing agenda; on December 8, NYC Mayor Eric Adams held a press conference where he delivered a speech and released his Get Stuff Built report. I pulled my favorite quotes from each. I recommend reading all of them, if not the speeches/report themselves. They reveal governmental awareness of the housing problem, and why it is important to solve for the sake of many other policy areas (à la The Housing Theory of Everything).
There are some typographical errors that are the product of a rushed transcription process, but I have faith that you will not be deterred. Also I do not want to edit all of that.
Mayor’s housing report
Remarks Made by NYS Governor Kathy Hochul:
What did I do on the town board? I did planning, I did zoning, the traffic safety, I made a lot of approvals of our projects when people wanted to bring a group home into our community, which made all the sense in the world. I had to take the line of fire sitting up on that board. We let the public speak as long as they wanted, but the nimbies, the people didn’t want that to happen. Or the countless times we had to undertake rezonings to make sure that we expanded our housing stock. And there’s always, always, always opposition.
And that’s how I approach all the problems we have here in New York State, with a sense of urgency that we have a finite amount of time to correct the wrongs of the past.
I watched my parents’ success unfold from the progression of homes they could afford. And it wasn’t just the good jobs that made that access available, it was the fact that there were homes to move into, that there was plentiful housing.
But we have to accept the fact that we are once again staring down a crisis. And this new crisis could potentially block families from achieving their dreams or forcing them to go elsewhere to achieve them. And this time it’s not for the lack of jobs. It’s actually quite the opposite. The jobs are here, but the housing is not. And so once again, people are having to leave their local communities, their extended families. And this is personal to me - I just became a grandmother six months ago, and if you can’t live near your grandchildren, if you want to, something’s breaking down the social order, the fabric is breaking down, and in some cases, people can’t afford to live in a community they grew up in and they’re leaving altogether. That to me is a tragedy. That’s a tragedy.
Well, we have to face some hard facts, my friends. We are in the midst of a housing crisis that has been decades in the making.
We have been pressure-testing ideas from experts and looking around the country. Are there models that work? Going to think tanks, talking among ourselves, having conversations about what are the answers to this. And as a result of a very deliberative, lengthy process that continues for hours still every day, it’s always in my schedule talking about this issue, we arrived at some very bold and impactful initiatives and ideas that will not be easy at all, but they’re necessary. They’re necessary.
So, I will say this: More will be revealed in my State of the State address. I know you’re a lot of policy wonks and you’re dying, “What is the answer? Tell us, tell us, tell us, oh, Governor, what is the answer?” And let’s talk about today as maybe being more of a trailer for the movie than the premiere in January. Okay. So, I just want to get you interested in seeing the characters and the players and the actors and something that has to unfold. And it has to be an Oscar winner. We have no choice.
And I want to be clear about some things. Let’s talk about what did not cause the situation where we are. It’s not from a lack of state funding for affordable housing because New York funds more subsidized affordable housing per capita than any other state. All those states that have blown past us. And that includes the historic investment I just made in the last year. We’re also a national leader when it comes to tenant protections. Nearly half of our state’s rental stock is public or rent-regulated. No other state comes close. So, it’s not that either. Here’s the real problem. We’re a national leader in blocking housing. Don’t take my word for it. I appreciate that, but I wouldn’t applaud that one. That’s bad. I’ll tell you when to applaud. That’s bad news. Don’t take my word for it, the Brookings Institute says that the suburban county surrounding New York City we know where they are maybe the worst in the country in terms of our regulatory and zoning hurdles.
New York is essentially in a league of its own when it comes to constricting housing development. And because of years-long processes, years and years, they’re so cumbersome, they prevent new houses from being built here.
We’re also still being outpaced by San Francisco, Boston, Los Angeles, all those cities have housing shortages, and you read about them, and they’re in the news, but they don’t touch the scale of the New York Metropolitan region.
Virtually no new housing has been created in large swaths of New York City, the region, the metro area for years compared with suburban areas across the country.
So, here we are. We’re in competition with other parts of the country, Maryland, Virginia, California, Pennsylvania, for the top talent. We want the smartest the best the brightest and most innovative, the risk takers, to continue coming here because that’s what made New York what it is. We know that. But we’re in competition with other states literally with our hands tied behind our backs. That’s what it feels like.
But the close-in geographic states that have done the work and built the inventory are the ones that are poised to capture the talent that are coming to the jobs that are right here in our own state. I tell you, as Governor, that’s frustrating. I don’t want to see that. I want to see those smart people working in our state and living in our state. I want their families to be educated here. I want their grandkids to live here someday as well.
The unemployment rate on Long Island already right now, today, 2.2 percent. The jobs are there. They’re looking for workers. But we have a situation where people have a job waiting for them in a place like Long Island or parts or New York City or parts of the downside area. The jobs are waiting for them. They can’t find housing. Guess where they’re going? They’re going to those houses that were built in New Jersey that I just described.
So, the unrealized capacity that we have for more housing production and not taking advantage of that is unconscionable. And I think it’s morally reprehensible that we’re not creating opportunities for people who want to call New York their home. And the impact is potentially catastrophic in the near term and far term. So, this becomes a threat to our economic health.
We failed to build the housing, create the housing, whether it’s new builds, conversions, retrofits. We’ve not adequately done our job there to match the jobs that are created.
And how can we be the first generation that’s not willing to give our kids and grandkids the same opportunities for advancement that we enjoyed? So, this has become - has potentially become an out-migration crisis. People talk about the reasons people may consider leaving. Believe me, I’ve heard them all. I also know there’s a lot of people who want to live here too.
I know they want to live here. You see what’s happening in other states out west. I won’t name a really big one, but people are leaving that state. The tech jobs that defined a region, Silicon Valley for a generation, they’re now coming here. They don’t want to be in suburban office parks. They want to be together.
This is the place they want to be. This is our opportunity to seize. So if we don’t, if we don’t observe the warning signs that are flashing right now, we’re going to continue on this path and it’s not good. But that doesn’t have to be our destiny. I’m not accepting it. If we do the hard things, which turn out to be the right things, we can transform this crisis into an opportunity.
Economists from the University of Chicago and Berkeley conducted a study on the nation’s housing crisis. It has a jaw-dropping conclusion. Here’s what they said. If San Jose, San Francisco, and New York, just those three cities had by 2009, not that long ago, 2009, adopted housing supply regulations similar to the median U.S. city, meaning that they were not restrictive, they’re as open as they are in the median U.S. city. Picture those three areas, building the way the rest of the country was during this timeframe. The GDP for the entire nation would’ve gone up 14 percent. Wow. Just imagine if we did half of that, if we did half of what we were supposed to do during that timeframe.
Our state motto is “excelsior.” It means ever upward, and that’s what we want in economic growth as well.
Those who look back at this time and said they saw what was happening, they had all the data. They knew from employers they couldn’t find people to work in the jobs because there’s no place for people to live that they could afford and the discontinued disintegration of families because you don’t have the grandma or the grandpa to impart values. People are going to say, “Why didn’t you wake up back in 2022, 2023, and do something about it, New York?” I don’t want to hear that. I want them to say something radically different. I want them to say, “Yes, there were institutional barriers. There was NIMBYism on steroids.” And I had to deal with this in my town, and I know exactly what I’m talking about.
All these factors were out there. Don’t come to my community because you don’t look like me. I don’t want you here. That has to be over…This is the place people want to be. It can be the New York that we’ve always had in our minds.
I can be a dreamer too, but I’m a doer. We have a chance to do something extraordinary here. I will meet this with the fortitude and the zeal that’s going to be required because we’ve never had a statewide strategy on housing before. But under my administration, that will change in January. We will act boldly. Not next year, not the next day. There’s no kicking this can down the road. I’m picking that can up right now. I’m saying, “We’re going to fix this.”
I know there’s going to be critics. I know there’s critics. I know what that feels like. But I will not be deterred. I will not be deterred in our quest because every community, every small town, every local zoning board, every planning board, every community has a role to play, and they must, and they must.
Remarks Made by NYC Mayor Eric Adams:
It is the people who make this city what it is. And if New York is to remain the city we love, we must have places for the people we love. We need more housing, and we need it as fast as we can build it.
This crisis has been decades in the making, but the reality is here now. There’s nowhere for people to go. The stories are everywhere.
In the last decade, New York City grew by nearly 800,000 people, but we added just 200,000 homes to our city. It’s not complicated: We have more people than homes. This shortage gives landlords the power to charge any price they want and leaves too many New Yorkers with no place to go. That needs to change. And history is on our side. We used to build things; we can do it again. We built the Empire State Building in just over one year at the lowest point of the Great Depression. 100 years ago, we built 750,000 new homes, more than three times the number of homes built over the past 10 years. Think about that for a minute.
94 percent of families in our shelters are Black or Hispanic; that cannot continue. Equity must be a part of the New York story just as it is part of the American dream. And building more housing is one of the best ways of creating wealth and economic opportunity.
One national study estimates that the shortage of affordable housing costs the American economy about $2 trillion a year in lower wages and productivity. Our city declared a housing emergency five decades ago, yet we have failed to address it with the same urgency we would any other crisis.
We are going to build faster, we are going to build everywhere, and we are going to build together.
But we know that building faster only works if we can build everywhere, so we need to start saying, “Yes in my backyard, yes on my block, yes in my neighborhood.” No more locking communities out of prosperity because neighbors are afraid of change.
The failure of neighbors on Long Island and Westchester to accept new housing has made the New York metropolitan area one of the most racially segregated in the country, more segregated than Birmingham, Alabama and St. Louis, Missouri. That’s not right, but it is reversible. It’s time for neighbors to do their part to ease the housing crisis. Our agenda calls for the state to make it easier for homeowners to create smaller accessory apartments, like basement apartments. And we want to change outdated rules, like parking requirements that prevent housing near transit hubs.
We want to thank Governor Hochul for her leadership and support on this critical housing agenda. As the governor said last week, there’s no kicking this can down the road. We’ve tinkered around the edges enough. We have failed too many people for too long. It’s time to build the next generation of affordable housing in New York City. Experts have proposed different numbers, but everyone agrees, to address the affordability crisis, we must double the rate at which housing is built in the city. It’s a major task, a major ask. But I did not become mayor to climb a hill, I became mayor to climb a mountain, and I want every one of you to climb it with me.
Today, I am issuing a call to our partners in the City Council, and our colleagues in Albany and in D.C., to the development community, nonprofits, faith leaders, and neighborhood advocates. Let us work together to meet the need for 500,000 new homes over the next decade. This is our mission, our moonshot, a bold effort that must fire ambition and inspire teamwork, because teamwork is the only way we get this done. We need everyone doing their part to reform outdated laws, expand incentives, increase coordinations, and build, build, build. And we must start now.
Safe, stable, affordable housing cannot be a privilege. It is the foundation of a prosperous society.
This city was built on the bedrock of opportunity, not just the opportunity to work here or pass through, but to live here. That is what makes New York City possible. New people, new ideas, new cultures converging here in search of a dream. The best people in the world, in the brightest city on earth. If we want to remain that city, the economic engine of America and the most diverse community on the globe, we must get stuff built, not for the few, but for the many. Brick by brick, block by block, this new city will rise again together.
And so it is imperative with our call of a full government approach to have this moonshot moment of 500,000 homes. It is low, middle and market rate. And the goal is not to displace, and I think reports are starting to show that development does not have to be displacement. It’s not about removing long term residents from their communities, but allowing them to be part of the development of their communities.
Question: Are you concerned at all that speeding up the process […] to miss or ignore legitimate environmental issues? Mayor Adams: No, not at all. Particularly with the smaller units.
The call today of that 500,000 moonshot is saying not only affordable, not only middle income, but even market, we need more housing. We don’t have enough housing to fit the population that we have.
Excerpts from the Mayor’s Get Stuff Built Report:
Housing is the foundation for everything else in our lives. Without a stable and safe place to live, no one can be expected to thrive (10).
“[T]he review process is estimated to increase total [project] costs by 9 percent, or approximately $67,000 per unit, for a high-rise building, for a typical two-year process for land use approvals.”— the Citizens Budget Commission, 2022 (10)
“The costs associated with a 3-month delay due to permitting during construction on a 100-unit building are $1.4 million, equal to the HPD subsidy for 11 units.” — the New York State Association for Affordable Housing (10)
The improvements identified in this report will cut the cost of land use approvals in projects subject to CEQR and the Uniform Land Use Review Procedure (ULURP) in half—resulting in over $2 billion per year in savings—and is estimated to unlock at least another approximately 50,000 units of additional housing production over the next 10 years. (11)
These savings have the potential to be passed on to tenants. Based on projections from the Citizens Budget Commission, the costs added by the CEQR and ULURP processes to a new building increase monthly rents by $430 for an average apartment. It is unacceptable that bureaucracy has kept money out of the pockets of New Yorkers for so long. This stops in the Adams Administration. (11)
Sometimes, these burdens stop development of housing altogether. For example, an emerging M/WBE housing developer sought to buy a parcel of land and build a 100% affordable housing complex. Current zoning law allowed only 155 affordable units on this land. The developer considered seeking a moderate zoning change, to keep with the scale of the neighborhood, to build 75 more affordable units for a total of 230 new affordable homes. Unfortunately, the uncertainty, time, and financial cost of the City’s development processes created a significant financial risk. For example, the M/WBE developer would need to make interest payments on their loans during the multiple years of CEQR and ULURP review without corresponding rental income. Ultimately, the owner decided to build fewer affordable units because it could not take on this additional financial risk. (11)
In addition to building more affordable housing, the City must also remove barriers that prevent New Yorkers from creating more small businesses and deliver faster capital projects for the benefit of New Yorkers. However, the Department of Buildings’ current permitting process—coupled with arcane zoning requirements—hinders the opening of new businesses and the expansion of existing ones and results in the delay or cancellation of capital projects by city agencies. (11)
In the months since the launch of BLAST, city agencies have already completed implementation of several improvements, with approximately half of the identified improvements to be implemented in the short term, over the next 12 months. Then most of the second half will be implemented in the longer term, generally over the next 12-24 months. And several major improvements—including those requiring ULURP review or major technology upgrades—may take up to 36 months to implement. In some cases, a quick and easy change may be implemented first, followed by a more significant and substantial change to the same process. (13)
I think this point is especially important. Although tenant protections, housing subsidies, etc are vital, it is not lack of them that is causing our housing crisis. That talking point needs to be retired. It is clearly a housing supply problem at the root.
I assume the governor is talking about this paper, “Housing Constraints and Spatial Misallocation” (2019, American Economic Journal: Macroeconomics) by Chang-Tai Hsieh & Enrico Moretti.
For those who don’t like market rate housing (for whatever reason), note that public housing is still built by public developers, and public housing is affected by many of these same rules and regulations. Constraints are constraints, and they need to go regardless of which kind of housing you think is best to build.