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Budget, Education & City Services
Community Board 5 Support for Intro. 1977, the Community Opportunity to Purchase Act
At the regularly scheduled monthly Community Board Five meeting on Thursday, April 08, 2021, the following resolution passed with a vote of 35 in favor; 0 opposed; 1 abstaining:
WHEREAS, Community Board Five (CB5) remains alarmed by the magnitude of the affordable housing crisis in New York City; and
WHEREAS, That affordable housing crisis has only been exacerbated by the economic effects of the COVID-19 pandemic; and
WHEREAS, Councilmember Carlina Rivera has proposed Intro. 1977, the Community Opportunity to Purchase Act (“COPA”), the purpose of which is to provide community-based non-profit organizations with an opportunity to compete with private entities in the purchase of residential properties in New York City in order to develop 100% affordable housing following such sales; and
WHEREAS, COPA seeks to accomplish this objective by giving qualified non-profit entities a first opportunity to purchase residential buildings offered for sale; and
WHEREAS, COPA proposes establishing a 120-day window during which only such qualified entities can put forth a market-rate offer to purchase a residential building, and if such offer is made, an additional 60-day window for negotiation—a process to be monitored and run by the New York City Department of Housing Preservation & Development (“HPD”); and
WHEREAS, The 120-day period and subsequent 60-day negotiation window is intended to even the capital-intensive real estate development playing field between private entities and such qualified non-profits, in which the former is usually able to outcompete the latter in the current transaction model in which speed matters more than how well the potential buyers’ development plans meet the needs of the community; and
WHEREAS, It remains in a building owner’s discretion to wait to receive additional offers from the private market following the 120-to-180 days and to select one of those offers instead, if higher, so long as the owner considers offers from qualified non-profit entities in good faith; and
WHEREAS, The passage of similar bills has led to successful outcomes in San Francisco and Washington, D.C.; and
WHEREAS, CB5 expressed uncertainty about offering unqualified support for COPA due to hesitations including but not limited to whether a 120-day waiting period is optimal, and about the fact that the bill’s current language is unduly difficult to understand and remains a work in progress; and
WHEREAS, The Real Estate Board of New York, among others, has expressed various concerns regarding the propose legislation, including but not limited to the bill’s restrictions on allowing the participation of certain for profit entities as well as non-profit/private joint ventures, and that, as it currently stands and as Councilmember Rivera’s office acknowledges, HPD lacks the resources to facilitate COPA short of receiving meaningful additional funding; and
WHEREAS, CB5 acknowledges the currently uneven playing field between non-profit and private developers in New York City when it comes to the acquisition of residential buildings and land, in which non-profits that are bound by their missions to produce and maintain affordable housing often struggle to compete with for-profit entities as a result of the former’s more frequent need to (a) procure government or other financing, (b) seek approval from volunteer boards of directors, and (c) perform this and other due diligence with more limited administrative resources than for-profit entities;
WHEREAS, CB5 agrees with COPA’s sponsors that increasing non-profit land ownership in New York City, and resultantly bolstering the financial stability of the non-profit sector, could lead to increased construction and preservation of affordable housing that meets the city’s needs; therefore, be it
RESOLVED, Community Board Five strongly supports the spirit of COPA, providing a meaningful opportunity for community-based non-profits to purchase residential buildings and land to create badly needed affordable housing, and encourages the City Council to consider the hesitations referenced above and, once the bill is in its final form, to provide notice to Community Board Five, which reserves the right to revisit this resolution in support at that time.