NYCHA’s Chelsea Gold Mine
A proposed rezoning of Chelsea’s public housing sites—Fulton Houses and Elliott-Chelsea Houses—could transform much of the neighborhood to midtown-like density. It would introduce towers of up to 39 stories a stone’s throw from early-19th-century Greek Revival rowhouses. This New York City Housing Authority rendering shows new buildings it would construct under the rezoning in gold, viewed from the southeast. The darker-shaded buildings would replace the existing NYCHA ones and their 2,056 dwelling units. The lighter-shaded buildings include about 3,500 new rental-housing units. Up to 30% of these, perhaps 1,000 apartments, would be affordable and the rest market rate, which amounts to luxury in this part of Chelsea. That means luxury apartments would outnumber public-housing units on public land originally set aside for low-income New Yorkers.
An earlier plan would have renovated all of the NYCHA buildings and allowed a small amount of new mixed-income housing to be built if needed to fill any funding gaps. The mixed-income portion exploded in size as the plan was revised to replace the buildings on unfounded claims that their renovation would cost just as much.
Late last year, NYCHA made the bombshell disclosure that the vast mixed-income rental revenue—possibly all of it—would go into its coffers for use throughout the city. It is to this end that the existing buildings would be demolished and much of Chelsea’s character sacrificed. Few in the community are aware of the proposal but among those who are there is well-founded fear for the neighborhood’s character.
NYCHA recently released a Draft Environmental Impact Statement, or DEIS, detailing the project and its impacts. Comments on the DEIS will be received until May 19th. NYCHA is required by law to respond in the Final Environmental Impact Statement to substantive comments from anyone. Failure to meaningfully do so could result in legal challenges, media scrutiny, or political fallout.
Chelsea’s Robert Fulton Houses and the Elliott-Chelsea Houses, together known as FEC, are viewed from the southeast in this NYCHA rendering. Like other public-housing developments across the country, they have suffered from decades of government disinvestment. In response to this funding deficit, NYCHA launched an initiative called Permanent Affordability Commitment Together, or PACT, in 2015. The program allows NYCHA to partner with private developers who manage renovations and operations. The developers have access to Low Income Housing Tax Credits, loans, and bonds to fund renovations—financial resources unavailable to NYCHA. They typically enter into 99-year leases on the land, of which NYCHA retains ownership. Residents continue to pay 30% of their income as rent, but the developers take over as landlords—a controversial transition from a publicly managed program called Section 9 to a privately managed one called Section 8, which some see as riskier for tenants—especially in light of its dependence on federal funding under the Trump administration. This transition is allowed by a 2011 Department of Housing and Urban Development program called Rental Assistance Demonstration, or RAD, which underpins PACT. NYCHA recently reported that 146 of its 335 developments had undergone PACT renovation or were at some stage of it.
In 2019, NYCHA proposed a PACT renovation with a difference for Fulton Houses. A new NYCHA building would be constructed on open space at the west end of the complex, outlined in orange above. Residents would move into it from the two buildings at the north and south ends of the complex on sites outlined in blue. These 7-story, 36-unit buildings would then be demolished and replaced with mixed-income apartment towers of up to 35-stories. They would contain about 630 mixed-income apartments. 20-30% of their floor areas would be dedicated to affordable units following the city’s rules for Mandatory Inclusionary Housing, with the balance market rate. This would be a demonstration project for Build to Preserve, a recently minted NYCHA policy. According to NYCHA’s project description:
Build to Preserve is a new construction program to develop mixed-income buildings at select NYCHA developments. The program’s proceeds generate additional revenue to fund repairs. One hundred percent of the funds generated by new construction will first be used to renovate the host development, and any remaining proceeds will go towards repairs at other developments in the same neighborhood.
Why would “additional revenue to fund repairs” be needed when similar developments across the city were being renovated with just the financial toolkit of the PACT program? And what made FEC a “select” development? In retrospect, it appears that NYCHA was targeting the high-rent neighborhood’s exceptional income potential and may not have been sincere about keeping the proceeds in the community. It now looks like the agency was putting its foot in the door of a new financial model—one to be replicated in other thriving neighborhoods—that would mark a radical departure from its history.
Not only might it seem heretical to propose market-rate apartments on public land set aside to house the underprivileged, but NYCHA had a proud history of not destroying its buildings. Half a century after St. Louis famously imploded Pruitt Igoe, New York could boast of by far the nation’s largest public-housing program. The 2016 book Affordable Housing in New Yorkreported that “with 178,000 apartments and an official population of 403,000, NYCHA would be the twenty-seventh largest city in the United States as an independent entity.” After recounting how other American cities have thrown in the towel on large-scale public housing, it continues:
So far, New Yorkers have resisted many calls, and great federal pressure, to do the same. NYCHA has replaced just two projects: four comparatively small towers at Prospect Plaza in Ocean Hill-Brownsville, originally built by a private developer in 1974 and now slowly undergoing redevelopment; and Edwin Markham Gardens (1943), a 360-unit, two-story garden apartment complex in Staten Island built as temporary housing for shipyard workers during World War II. Markham’s wood-frame and stucco buildings, which were beyond repair, were replaced with 370 new low- and middle-income units between 2008 and 2012.
The 2019 Fulton Houses plan was abandoned in the face of vigorous resident opposition to the required demolition of the two NYCHA buildings. A new renovation plan barring demolition was developed to include both the Fulton and Elliott-Chelsea Houses by the same Chelsea-NYCHA Working Group behind the earlier proposal. It was made up of resident representatives, Manhattan Community Board 4 members, housing and legal advocates, elected officials, members of the mayor’s office, and NYCHA officials. This proposal fared better and in April of 2021 NYCHA issued a Request for Proposals from private developers to renovate and manage both the Fulton and Elliott-Chelsea Houses under the PACT program. While the scope of work described in the RFP included no demolition, it allowed construction of mixed-income “infill” buildings on the two campuses’ open spaces.
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