Karen Ingenthron (KI): I'm very happy today to have a wonderful panel of guests. We're going to be talking about Mitchell-Lama buildings. We have Bob Woolis, a member of the Mitchell-Lama coalition, who's come to Roosevelt Island many times to help us with our budget rent determinations. He's helped us with the history of Roosevelt Island with regard to Mitchell-Lama and helped us understand the whole system. We also have representatives from buildings in New York City. Each one of them has a different situation, and we'll discuss that as well. Bob, would you like to give us an overview of Mitchell-Lama and what's going on?

As a member of the Island House Ownership Committee (IHOC), Tim Johns has made himself something of an expert on Mitchell-Lama. He says that while Island House, Westview, and Eastwood face some of the same potential difficulties Ruppert Towers residents are experiencing right now, the situation for the Roosevelt Island buildings is more complex, and - in a word - different. "The main difference here," Johns says, "is the business of the ground lease. The building owners don't own the ground, so to take the buildings out of the Mitchell-Lama program will involve RIOC as well as DHCR, and possibly UDC, which holds the Island under lease from the City." Johns goes on, "RIOC is in a position to protect tenants by virtue of its power to set terms of the new ground lease that would be required for buildings to leave the Mitchell-Lama program." On the other hand, he says, "RIOC is probably not in a position to hurt tenants, at least not single-handedly, because DHCR, we feel, as RIOC's supervising entity, would have to approve." All of this puts RIOC, the owners, the tenants, in a strange poly-partner dance, according to Johns, with DHCR and UDC looking on. "RIOC's interest is to increase its revenue from the ground. The owners want a ground rent low, to facilitate the privatization. The tenants want ground rent set at a level that protects affordable housing, and show a strong interest in conversion to coop or condo. Remember, too, that UDC would set new PILOTs (payments in lieu of taxes) upon privatization and, therefore, will play an essential part of any deal."

Bob Woolis (BW): The decade of the 1960's was really the start of the Mitchell-Lama program. It was a time of ferment, and this troubled a lot of our legislators. They were afraid that things might start happening in New York or Albany - wherever there were segments of disenchanted population. So they decided to build low and moderate-income housing, mostly in New York City. At that time, there was no real bickering among Republicans and Democrats. Everyone knew about the housing shortage.

There are a couple of kinds of Mitchell-Lama Housing, not really different but different kinds of supervision, by Housing Preservation and Development (HPD) for the City, and for the State, the New York State Division of Housing and Community Renewal (DHCR).

My group, the Mitchell-Lama Residents Coalition was organized in 1982. The co-founders were our great Congressmember, Charlie Rangel, and myself, and another person who's passed away.

KI: We want to talk about this 20-year buy-out.

BW: Article 35 of the Private Housing Finance Law says owners have the right to buy out of the Mitchell-Lama program by paying off the mortgage. They have the right after 20 years of occupancy. It's as simple as that. And unfortunately, the law is very clear, and the process, once it starts, becomes mostly relentless.

Lila Dies (LD): I'm the President of the Tenants Association for Ruppert Yorkville, between 90th and 92nd Street on Third Avenue. We've been up about 25 years. There's also in the buy-out a very important date, which is January, 1974. Buildings occupied before January, 1974, go into rent stabilization when the buy-out takes place. Buildings occupied after January, 1974, don't have that protection, so that when our building goes out, our rents can go to fair-market rate.

There are no restrictions. It won't cover any senior citizens. It won't help anyone who's disabled. So we will go a little less than market rent. In June, our management company announced to us that they were going to buy out. We have a lawyer and we are fighting this. We've been very successful in organizing our tenants to raise money. We represent between 2000 and 3000 people. We have low-income people, moderate-income people, and even some high-end.

When the owners announced, the Sunday before Thanksgiving, we had a huge meeting at the 92nd Street Y. They were actually brutal in terms of their announcement. They were saying that a one-bedroom apartment would go up to $1,590, a two-bedroom apartment would be about $2,000, and I think a three-bedroom would be around $2,500. I'm in a one-bedroom apartment, and I've been there 20 years. I pay $700 a month now. My rent would more than double to about $1,700, right after our leases run out.

Management got so angry, by the way, when we went to court, they were so angry with us that they counter-sued us, and in their counter-suit they're telling us we have to pay them $1.25 million a month because they're saying we're taking away their ability to earn that extra income, because they couldn't get a mortgage. Once we went to court, we stopped them from getting a mortgage, and no lender was going to lend them money. But we're really under the gun and we're very, very concerned.

Ari Goodman (AG): I'm a resident of Westgate, on the West side, and I'm also Chair of the legislative committee of the Borough President's Mitchell-Lama Task Force. Our building has already been bought out of the program.

We were occupied in 1968, so we went into rent stabilization, so you would think we had some protections.

It wasn't enough for our landlord. Within one month of going into rent stabilization, he made an application saying now he has high taxes, rents are too low, he wants the rents to increase 300 to 700 percent to be like the other rents in the area so he can meet his expenses. He knew what he was getting into when he bought out. He is making enough money. He just wants to get rid of the tenants, turn this building into a luxury building.

There are tenants living there 30 years, they built the neighborhood. The building has tenants of all ethnicities, races. Everyone gets along; we're an excellent community. The landlord is making a good profit. Under Mitchell-Lama he was making at least six percent. He doesn't really care about the tenants. Other buildings are in worse shape. They had to go straight to fair market rate. Hopefully all the tenants will get together and convince the legislators to clamp down on this and not allow this to happen.

KI: What does the Borough President's Task Force hope to do?

AG: We hope to influence legislators to pass legislation. There's some on the floor right now, to increase the amount of years necessary to buy out of the program, to give longer notice. Right now they just give six months notice that they're buying out.

There's all this talk about building new affordable housing, middle-income housing. Something seems wrong here. We have all this housing there. We should preserve it. It's cheaper and easier to preserve housing. We also have to build more housing. But people seem to forget that we could preserve the affordable housing we have now. They're trying to give incentives to builders to build. Let's give owners incentives to stay in affordable programs.

BW: Nobody seems to be interested, particularly our present people, Pataki, in Albany - you may gather he's not one of my buddies - and certainly Giuliani. We met with Fran Ryder a couple of years ago, who was a deputy mayor then, and he indicated he's not interested in Mitchell-Lama. They want to privatize everything. The supervising agencies, namely DHCR and HPD and HUD, they haven't been doing what they're supposed to be doing, namely supervising to make sure the buildings are in the best possible shape, to make sure finances are OK, to make sure this money is used for the purpose it was intended for.

LD: If you think about the numbers. we're talking about 3,000 people or more in our building... if you think about it, if you had a town like Troy, New York, the entire town of Troy would have to vacate. You have this huge number of people who are under the gun.

KI: This history of these other buildings is what Roosevelt Island really needed to know about 5-10 years ago. It sets the stage for what is happening there. Let me introduce my neighbor, Audrey Berman, who is Chair of the Westview-Island House Task Force.

Audrey Berman (AB): Westview and Island House are 700 middle-income rental apartments on Roosevelt Island. We are under DHCR supervision. We were occupied after 1974. We anticipate that at any moment what has happened to your buildings may happen to us. Knowing this, we've actually been meeting with our owner for the last two or three years to try for some kind of tenant ownership. We felt that was the only way to maintain affordable housing - that perhaps we could convert from a Mitchell-Lama rental to a Mitchell-Lama cooperative, or even if we went out of the Mitchell-Lama program as owners, it would be affordable.

On Roosevelt Island the irony is that we don't know what the market will bear. We just don't know yet, and that's to our advantage. But, by the same token, our rents already seem to be quite a bit higher than what you were mentioning.

I think it's important to understand that tenants in Mitchell-Lama buildings are paying rents. Landlords and owners are not giving us a subsidy. The average one-bedroom rent on Roosevelt Island is $950 a month. That's just below Manhattan market, and this is not subsidized housing the way most people think of it.

We feel there is a flaw in the Mitchell-Lama legislation which says we could be bought out at any moment, and we are operating with that in mind - that our owner, given the right time, is going to take us out of the program. And we've been meeting for over two years about the ownership. We understand there has been no movement on it because he's waiting to see what's going to happen.

LD: Our landlord has never wanted to meet with us. He's been very resistant to meeting with us.

AB: Since the Ruppert Towers story has broken we have not met with our landlord. He's from Texas and probably was not as informed, but since this has happened we have not really sat down with him for the last year. We were meeting quite regularly until then.

AG: Let me point out a law is not like a contract. If the landlord had a contract that they could buy out it would be a done deal. It's a law. Laws can be changed. The Legislature can change the laws. They could increase the years before buy-out is permitted. They could do away with the buy-out. There's a lot that could be done.

KI: What can we do to launch a campaign to protect this affordable housing for people?

LD: There is Legislation that's already passed in the Assembly. There are three bills. One bill would provide that all buildings that go out are rent-stabilized. That's the one that we're most interested in. Even though that may not be the answer to everything, it at least gives us some level of protection.

BW: That rent stabilization law expires in 2001.

LD: The same three bills are being introduced in the State Senate by Olga Mendez, and we have to put pressure on the Senate, which is really the key - the Republican State Senate.

AB: Is it true that the Mitchell-Lama legislation has not even reached the Senate floor for a vote?

BW: Of course it hasn't. If we even had the support of the metropolitan area Senators, then it would pass. Now somebody like Roy Goodman... he'll sign onto a bill, that's fine, but we really need his leadership.

LD: We really need Roy Goodman because he's a Republican. Most of the Mitchell-Lama complexes are in Democratic areas, not in Republican areas, so it's very, very hard to convince Republicans to support us.

BW: All we want them to do, and this applies to Goodman, - something he's never done - is to get these bills to the floor where they can be discussed in a democratic way and have the opportunity to vote them up or down.

KI: Roy Goodman's phone number is (212) 298-5515, and his fax number is (212) 298-5518. On the local level we also want to hit City Council. The telephone number for the Mitchell-Lama Coalition is (212) 465-2619.