Youth hostel solutions (photo: CTA Architects)
New York City is suffering from a severe affordable housing shortage and it has only gotten worse since 2010. A recent study by New York Communities for Change and the Real Affordability For All Coalition illustrates how Airbnb is exacerbating the affordable housing crisis in New York City.
What's shocking is that 20 percent of all New York City apartment vacancies in certain communities are simply disappearing, with the East Village losing 28 percent to illegal hotel rooms on Airbnb.
The study revealed those apartments are instead being offered on average 247 days a year and rented 109 nights a year as unregulated hotel units; and that nearly 60 percent of 27,000 units listed were "whole apartment rentals," meaning they are illegal.
As former chair of the New York State Assembly Ways and Means Committee, what's most shocking to me is that the City and State of New York see zero tax revenue from these illegal hotels. That is simply a crime.
The seeds of this crisis sprouted in 2010 when an unintentional legislative act forced the shutdown of over 50 regulated youth hostels representing over two million bed-nights in the city. Lacking that inventory and without more affordable options, victims were made of unknowing tourists, our city's scarce housing inventory, and travel-related tax revenue.
As more communities and building residents across the five boroughs are up in arms about illegal rentals under their noses, the New York City Council now has a sensible, although indirect legislative solution (Intro. 116) that just might begin to ease the housing shortage, by first legalizing the construction, licensing, and regulation of a new generation of safe, urban youth hostels in city commercial districts. This can make a significant difference.
In 2014, cities including Boston, Chicago, Miami, New Orleans, and Washington, D.C., attracted hundreds of thousands of youth travelers (age 15-30) patronizing a new generation of safe and affordable youth hostels. This happened as the old boarding house-style facilities many New Yorkers might think of yielded to the modern urbanism millennials demand.
The U.N.'s World Tourism Organization (UNWTO) identifies millennials as the next big hospitality market explosion. The U.N. says international youth travel will grow from $173 billion annually today to $320 billion by 2020, and soon command 25 percent of all international travel. Industry data finds those international youth hostel customers' top destination is the United States, and the city they desire to experience the culture of most is New York.
These travelers may be pre- or post-college, alone or in a group, going to multiple cities where their budgets require lower-cost lodging to maintain their ability to afford several cultural experiences. Just think about the college kids you know, traveling through Europe or South America on a budget during a semester abroad. They likely did not stay at a single luxury hotel, unless of course mom and dad came to join for a week and pick up the tab.
So what option have these international youth travelers been left with in the Big Apple? They can either avoid New York City completely, or more likely find some cheap, albeit unregulated, unlicensed, likely unsafe and illegal place to stay. Enter Airbnb.
On the other hand, travel industry data reveals that tourists who travel the world and patronize hostels in their youth are more likely to return back to the cities they experienced favorably in later years, for business and vacation, and then it is their turn to finally patronize full-service hotels.
New York City should open its arms and eyes to this next, big, youth cultural and hospitality market – some of it happening around our city already.
Legalizing and regulating modern youth hostels creates a free market incentive for companies that own and operate them to offer the highest quality, safest, and most welcoming facilities that fit well into the communities where they are located.
The U.N. is telling us that waves of young tourists are going to travel to New York. The question is, will New York allow them to continue renting out scarce apartments as illegal hotels, or will it follow the lead of other U.S. cities that recognize, regulate, and collect taxes from them as legitimate contributors to the hospitality economy?
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Hon. Jerry Kremer is Chairman of Empire Government Strategies and served 23 years as a member of the New York State Assembly, including 12 years as Chairman of the Ways & Means Committee and served by appointment of the Governor on the Metropolitan Transportation Authority's Capital Review Board and the Public Authorities Control Board. He is also a spokesman for Hostelworld, the globe's largest reservation service in the hostel industry. Hostelworld does not own or operate hostels.
Calling on the governor to support CUNY staff (photo: @PSC_CUNY)
Employees at the City University of New York (CUNY) have been without a contract for over five years, despite the fact that most other state workers have not only settled their contracts but are actually preparing to negotiate the next round of agreements. The major hold up is a demand by Governor Andrew Cuomo that any salary increases for CUNY employees come out of the University’s operating budget - in essence, a major cutback in CUNY funding.
Given the long period without a contract, the cost of retroactive pay, just for faculty and professional staff, is at least $240 million to stay consistent with what other state workers received. The City has agreed to pay its share. This tension exists despite the fact that CUNY only receives around $500 million in direct support from the State each year and another $300 million out of the statewide Tuition Assistance Program (TAP) that serves public and private colleges. A cut of the magnitude created by forcing CUNY to pay for salary increases from operating expenses would be devastating to the university system and the 275,000 students it serves.
Last Tuesday, Governor Cuomo told reporters that rather than the State providing additional funds for CUNY and its employees, the City should pay more of the costs, a message similar to the one he has delivered recently concerning shortfalls at the MTA. The State took over primary financial responsibility for CUNY during the New York City fiscal crisis of the 1970s. Since then, the State has provided about 75 percent of government funding, with the City picking up the rest, mostly in support of CUNY community colleges. Cuomo says that he wants to revisit that arrangement given the City’s relative fiscal health. This seemingly rational stance belies several important facts that undermine the governor’s position.
First, the State’s fiscal health is not really an issue. The State had several billion dollars extra in revenues this year to spend, but it chose not to spend it on public higher education. Both CUNY and SUNY were given flat funding, budgeting that failed to take into account mandatory cost increases such as higher energy and maintenance costs, resulting in a $63 million shortfall for CUNY.
The governor has not said whether he will support a new bill passed by the Legislature this month that would fix that problem going into the future. In addition, last year the governor saw fit to use some of the State’s extra revenue to actually cut taxes for many residents, resulting in millions of small checks being sent out that seemed more like an election year stunt than rational fiscal policy. In fact, generous tax cuts made under Governor Pataki have severely undermined the state’s finances. Ending these tax breaks, which went overwhelmingly to the very richest New Yorkers, would generate billions in revenue, more than enough to place CUNY on stable footing.
According to an analysis by the Professional Staff Congress - CUNY, the State has consistently shifted funding during this period from state aid to student tuition. In 1989, tuition covered less than 20 percent of CUNY operating costs, while today it is closer to 50 percent. This, despite the fact that over half of CUNY students come from families that make under $30,000 a year. Tuition has increased by 58 percent in the last five years alone and more tuition increases are being planned.
Second, it is revenue from the city that makes state government possible in the first place. The state budget is a giant engine of resource shifting from downstate to upstate. An analysis by the Rockefeller Institute done in fiscal year 2010 showed that upstate regions received 42 percent of state funding despite generating less than 28 percent of revenue, including those from tuition, gambling, etc. New York City generated 45 percent of revenue, but received only 40 percent of funding, with downstate suburban counties making up the remaining difference. The idea that New York City is not paying its fair share is ridiculous.
Third, no other local area is being asked to engage in cost sharing to support public higher education at the four-year colleges and graduate schools. Upstate counties do contribute to community college funding, but Buffalo, Albany, and other cities with SUNY schools are not asked to cover basic operating expenses in the way Cuomo is proposing for CUNY.
Fourth, the City actually is spending more. In the last two budget cycles Mayor de Blasio has added additional funds to support the community colleges, especially for financial aid and special programs such as the highly successful Accelerated Study in Associate Programs (ASAP) recently touted by President Obama.
Fifth, funding for CUNY generates significant fiscal as well as social advantages for the state. CUNY students, who are mostly non-white and first generation college students, tend to shift from being consumers of government resources to producers of tax revenue upon graduation. Failing to invest in this population suggests a callous disregard for both this economic reality and the interests of these students and their communities.
Perhaps the governor, who like his father was a product of parochial and private schools, fails to appreciate the central importance of CUNY for communities of color and immigrants. CUNY, as much as any other government institution, has been a central force in the building of the middle class and the integration of immigrants into the mainstream of society. It’s time that he treats funding for CUNY as the social justice issue it is, rather than a punching bag in his fight with the mayor.
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Alex S. Vitale is associate professor of sociology at Brooklyn College and author of City of Disorder: How the Quality of Life Campaign Transformed New York Politics. He is senior policy adviser to the Police Reform Organizing Project and serves on the New York State Advisory Committee to the US Civil Rights Commission. You can follow him on Twitter: @avitale
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Rev. Wilkes, middle, leads a prayer & voter registration drive (photo: @andrewjwilkes)
Jamaica needs development that benefits long-term residents, workers, and the families of Southeast Queens. Development is a multidimensional process. At best, the process not only supports real estate firms, but also expands the availability of affordable housing opportunities and family-sustaining jobs that pay a living wage. Although we applaud the efforts for improving Jamaica, we are concerned that current plans are not going far enough to guarantee equitable development of jobs and housing for local families.
Under the Bloomberg administration, New York City witnessed rezoning to facilitate development in industrial neighborhoods like Williamsburg and Long Island City. With that process came the escalation of rents, leases, and the overall cost of living. While some individuals benefited from this process, wide scale displacement of residents and the local workforce occurred, especially among people of color. In 2007, under the same administration, 368 blocks of downtown Jamaica were rezoned for higher-density development, meaning more units of housing, office, or retail space for the broader community of Southeast Queens. As the economy crashed in 2008, much of the anticipated development was stalled, but a real estate boom is kicking in now with estimates of more than 3,000 units of housing in the coming years. As faith leaders of Southeast Queens, we're lifting up our voices to ensure that our community promotes equitable development of job and housing opportunities for individuals and families whose labor makes this area such a vibrant constellation of neighborhoods.
We recognize and appreciate the contributions of other voices to this conversation. Participants who created the "Jamaica NOW" action plan, for instance, have championed valuable – and viable – ideas for improving Jamaica. The plan intends to do three things: increase quality jobs and small business support; promote commercial growth and economic development; and improve livability for both residents and visitors. Already, the beautification of Rufus King Park is making a difference in the recreational and cultural life of Jamaica. The plan, however, doesn't specify a comprehensive vision for equitable development. Without such details, our concern is that modestly inclusive projects will benignly, but mistakenly, be heralded as successes and the best we could do for our communities.
Two examples illustrate our concern. Let's start with the NYPD lot development project on 168th and Archer Avenue. The city's Fair Wages for New Yorkers Act defines a "living wage" as just $11.50 per hour and notably applies to construction workers on this project because the property is receiving more than $1 million in subsidy from the city Economic Development Corporation. However even if two members of a family were working full-time, with no vacations, at this wage they would still be ineligible for the affordable housing within the project because they would not make enough to meet the income threshold accorded by the zoning of the area.
Another example drives from the de Blasio administration's plan to rezone East New York. In that community, the administration recently announced a plan for 50 percent of new housing to be affordable at neighborhood-based incomes, yet in Jamaica we are talking about just 20 percent of affordable housing being produced – and that only within a smaller "special inclusionary zone" in which the builders are only required to build if they take additional subsidy. Yet even this 20 percent is not truly affordable - a family of three would need to make at least $62,150 to be eligible for the housing, while the median income in Community Board 12 representing Southeast Queens is $50,857 per year.
Given the dynamics outlined above, our question is: what can be done differently? How can we ensure that we advance equitable development in Southeast Queens, that we build it right in our community?
Three ambitious, yet achievable goals stand out for our community, congregations, and city. First, we can lift up the moral imperative of our faith traditions to make the case for equitable development. Our religious traditions teach us that laborers deserve to be paid; that what's done in the dark – negotiation of terms and deals – should be brought into the light; that attending to the weighty matter of justice is central to our convictions and congregations. Second, we can use city subsidy and the leverage that it brings to infuse parity into the production of affordable housing. Instead of settling for developments whose housing is 80 percent market-rate and 20 percent affordable, we can pursue an even division of residential opportunity: 50 percent market-rate and 50 percent affordable for local residents. Third, we can ensure that strong legal protections prohibit harassment and displacement among tenants living in downtown Jamaica and surrounding communities.
We celebrate the resurgence of downtown Jamaica and the surrounding community. In many respects, this resurgence is a belated recognition of the tremendous legacy and potential of Southeast Queens. We invite you to join us as we learn, pray, and take action together for a renewed call for equitable development in Southeast Queens tonight, Tuesday, at 6:30 p.m. at the Greater Allen AME Cathedral of New York. Our best days await us, and we look forward to continued collaboration with elected officials, labor unions, congregations, and other community groups to create deeply affordable housing and family-sustaining jobs in our neighborhoods.
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Rev. Andrew Wilkes, the Greater Allen A.M.E. Cathedral of New York
Bishop Joseph Williams, Christ Church International
Pastor Brian Ellis Gibbs, Queens Baptist Church
Father Jeffry Dillon, Christ the King & St. Mary Magdalene