Kara I. Schechter Rakowski and Alexa Englander ()
The development of multiple dwellings in Special Anti-Harassment zoning districts located in Manhattan has historically come along with its own special kind of red tape. In the last few decades, restrictions on demolition and material alterations have made it very difficult for development in certain special districts.
For example, as a prerequisite to pulling permits from the New York City Department of Buildings (DOB) to demolish, partially demolish or perform material alterations to multiple dwellings constructed in a special district (and initially occupied prior to Jan. 1, 1974), the owner must first apply for and obtain a Certificate of No Harassment (CONH) from the New York City Department of Housing Preservation and Development (HPD). The CONH application process requires disclosure of information pertaining to current and former building occupants, owners and managers dating back over 10 years (and in the case of the Special Clinton District, dating back over 40 years) with the goal of determining whether any building occupant was “harassed,” as such term is defined under both the Housing Maintenance Code and the Zoning Resolution (ZR).
The CONH requirement has traditionally served to discourage, deter or otherwise limit development of some buildings in special districts, largely due to the various unknowns associated with a lengthy look-back period and treatment by prior owners of former or current building occupants.
Within the last two years, however, HPD has started to enforce a previously overlooked provision of the ZR which has presented even more obstacles for developers to navigate in order to develop sites in the Special Hudson Yards, Clinton, West Chelsea and Garment Center districts in Manhattan.
Zoning Resolution 93-91
Stemming from concerns surrounding the Hudson Yards rezoning, including the restoration of the High Line and related upscale commercial and residential development beginning in or around 2004, the New York City Department of City Planning (DCP) submitted an application pursuant to §201 of the New York City Charter seeking the amendment of various provisions of the ZR pertaining to the above-listed zoning districts. The City Planning Commission (CPC) held a public hearing on this “Follow-up Text Amendment (N 100424ZRM)” on Aug. 11, 2010, and on Sept. 29, 2010, the Commission issued a Report wherein it “approved the application with modifications.”
The CPC’s report pertained exclusively to transit provisions and the now adopted (and only recently enforced) demolition provisions of ZR §93-91. The report provided that the proposed text was intended “to address community concerns that the significant growth forecasted for Hudson Yards and the adjacent areas, should it occur, could result in development pressure that may affect housing that has historically provided an affordable housing resource for area residents.”
The then-proposed text of ZR §93-91(a) pertained to multiple dwellings that are “unsafe building[s]” requiring demolition pursuant to the Administrative Code, and also applied in the following scenario, as set forth under ZR §93-91(b):
(b) the Commissioner of [HPD], after providing sixty days’ notice and opportunity to comment to the local Community Board, has certified:
(1) if such multiple dwelling is to be substantially preserved, that an alteration permit is required to allow the removal and replacement of 20 percent or more of the floor area;
(2) if such multiple dwelling is not to be substantially preserved, that [HPD] has determined that the rehabilitation of such multiple dwelling is not feasible under any active governmentally-funded program; and
(3) that [HPD] has issued a [CONH] pursuant to [ZR §93-90(c)], or has certified compliance with the cure provisions of [ZR §93-90(d)].
The practical effect of the proposed text was to require (in addition to the requirement that the building owner obtain a CONH from HPD and only for buildings that are not “unsafe”), that the building owner must obtain an additional certification from HPD, upon notice to the local Community Board, regarding the feasibility of rehabilitating such multiple dwelling under “any active governmentally-funded program,” (without identifying or otherwise limiting which programs may be applicable), prior to obtaining any demolition or partial demolition permits from DOB. (For partial demolitions, the provisions only apply “where such partial demolition would decrease the amount of residential floor area in such multiple dwelling by 20 percent or more.”)
Manhattan Community Board 4 (MCB4) submitted a letter to the CPC noting its unanimous support of the then proposed text, subject to certain conditions. These conditions were that (1) DCP report[s] eligible properties via Block and Lot designations to HPD and DCP and (2) DOB flags its Building Information System (BIS) by block and lot to ensure compliance. MCB4′s letter further noted that it had “compiled a list of eligible buildings by block and lot with accompanying maps,” which it purportedly attached to its letter to the CPC.
Thereafter, the amendments to the ZR were adopted effective Oct. 27, 2010. Notably, notwithstanding the request by MCB4 in its letter, it is not clear whether DCP reported eligible properties to HPD and DCP or that DOB flagged its Building Information System “to ensure compliance.”
In fact, to the contrary, it appears that the newly adopted provisions of ZR §93-91 were largely ignored for the next five years. It was not until in or about October 2015 that MCB4 began writing letters to DOB, HPD, other city and state officials and agencies regarding the agencies’ alleged “failure” to enforce ZR §93-91(b) with respect to various sites located in the affected zoning districts. The alleged failure to enforce ZR §93-91(b) was predicated on DOB’s issuance of demolition or partial demolition permits to the various buildings identified in MCB4′s letters without first requiring that owners and/or developers obtained the additional required certification from HPD.
The buildings identified were in various stages of the demolition process, and the near immediate consequence of MCB4′s letters was that DOB issued stop work orders to the affected buildings. As a result, the affected property owners were left to navigate the uncharted process of applying for certification from HPD that “the rehabilitation of such multiple dwelling is not feasible under any active governmentally-funded program,” notwithstanding the absence of any formal application form or process. As noted, there is no indication under the ZR which governmentally-funded programs would be applicable or available to a private owner or developer.
Further confusing this already murky predicament, some of the letters from MCB4 to DOB (and other agencies) specifically pertained to buildings that had not been providing an affordable housing resource, nor were they identified on the map submitted by MCB4 to the CPC during the public comment period leading up to the adoption of the new provisions.
An additional complication is the fact that a CONH is only valid for three years from the date of issuance. Given that the affected property owners had to obtain a CONH in order to pull the permits from DOB in the first place, many are now caught in a true bureaucratic quagmire with the clock ticking against any CONH in place, revoked work permits and stop work orders in place.
To the extent that HPD has determined applications from owners and developers seeking certification under ZR §93-91(b), HPD has, apparently, declined to issue the certification sought in most, if not all, cases. In fact, as far as the authors are aware, HPD has issued near identical determinations to applicants—notwithstanding the unique ownership structure and/or history of residential occupancy relevant to each affected property.
While many building owners in New York City, and particularly in Special Anti-Harassment Zoning Districts, have accepted the risks and headaches surrounding the CONH application process (and other bureaucratic processes), HPD’s new enforcement of ZR §93-91(b) is likely to serve only to further chill development of under-utilized multiple dwellings in these areas. Thus, the practical effect of the newly enforced text may not be to preserve affordable housing—which was the intended goal of the text when it was first conceived, proposed and adopted between 2004 and 2010—but rather to stifle the development of dilapidated, vacant or under-utilized buildings in otherwise burgeoning Manhattan neighborhoods.