This week on Housing New York, political uncertainty continues to put housing reforms at risk. We'll explain why. Plus, a debate over sprinklers and affordability is back. We break that down. And it's the coldest winter in a decade. That means heat complaints are up. We'll talk about it. 

Let's start Housing New York.

[THEME]
“We need 800,000 units to meet the demand today. What we have right now in the United States and what we have right now in New York City is almost a crisis of absurdity. Our housing crisis has been so long in the making, and the severity of this crisis is now so dire, that to change the trajectory of this problem, we need to do everything, everywhere, all at once.”

[INTRO]

Welcome to the Housing New York podcast, your weekly recap on all the housing news impacting New York. I'm your host, Kenny Bergos, CEO, of the New York Apartment Association. I'm also a former assemblyman, and I can tell you the next five to six weeks are going to be very busy. 

There will be budget hearings, last minute pushes on key legislation, and now the governor wants to pass legislation that will limit the power of the New York City mayor. So there is a lot happening. 

Now it's time to get to the news. 

[01:32] [Update: City Hall]

We're leading the podcast talking about the biggest story last week, the future of New York City Mayor Eric Adams. 

To recap, the Department of Justice, at the behest of President Trump, asked for all corruption charges against Adams to be dropped. Several U.S. attorneys refused, and were either fired or resigned. The judge in the case also refused to immediately dismiss the charges, and instead asked a former judge to make the case that the prosecution should continue, even though the DOJ doesn't want that to happen.  

All this has led to calls for Governor Hochul to step in and take steps to remove Adams from office. She said at the end of last week that she wouldn't do that. Instead, she is moving to limit the power of the New York City Mayor, assuming the state Legislature and the City Council go along with her plan.  

Last week was a loss for all of New York. 

It would have been better if we got some clarity on this matter, instead of more delays and more confusion. Many of our members own buildings that are highly regulated and they rely on the government to operate without distraction. When there is a lack of leadership, the government agencies don't operate well, and that is bad for the entire city. 

We really hope there is clarity on the future of Mayor Adams soon. That clarity is needed.  

[02:43] [Update on proposed ConEd hikes]

We have a quick update for you now on the proposed energy hikes from Con Edison. 

We were pessimistic that any elected officials would speak up against those hikes. Then Governor Hochul did. And now, seven members of the congressional delegation have also called on the Public Service Commission to reject the proposed increases on electricity and natural gas.

Shoutouts to Congressmembers Torres, Espaillat, Meng, Velazquez, Nadler, Goldman, and AOC for signing that letter. This has been a cold winter and multifamily building owners have told us their heating and energy costs are significantly higher than previous years, so any relief is beneficial. We know that capping income without capping costs forces a business to make difficult decisions, forego investment or defer maintenance. 

We're happy that rent-stabilized buildings are not going to get strapped with another cost hike, but we are also aware that failing to approve an increase for ConEd could lead to service disruptions in the future. So I would hope that elected officials have a more holistic energy plan, the same way we wish they would have a more holistic plan for protecting the long-term future of rent-stabilized housing. 

[03:50] [Sprinkler Systems]

The next story we're going to talk about is a proposal to make sprinklers mandatory in all new housing construction. 

This has sparked a big debate about safety and affordability. Requiring sprinklers in a new single-family home is an added cost of nearly $30,000. 

In most parts of the state, the average cost of a first home for a family is around half a million dollars. That works to about $3,400 a month in mortgage payments, assuming you put $50,000 down at closing. 

So a family would have to make about $140,000 a year just to afford that. 

That's already out of reach for many families. An additional $30,000 would make it even less affordable. But the people advocating for the requirements say it will absolutely save lives, and it will lower insurance costs, so they're hopeful it gets passed. 

We wanted to highlight this story because it was refreshing to see a debate over regulations and cost. Every time there is a new regulation proposed at the state level or city level, it has a cost, and in most situations, it directly leads to higher rents or higher home prices. 

We think a good practice for elected officials would be for all new bills to have a clear estimate on how much they will increase rents or housing costs. 

[05:05] [LLC compliance update]

We wanted to take a moment to give everyone a quick compliance update. It involves LLC filing. 

As part of the Federal Corporate Transparency Act, all LLCs must file Beneficial Ownership Information Reports before March 21st. This was on hold because of a legal challenge, but a court ruled that the compliance with this law must go forward.

If you don't file, you can pay large fines – up to $593 a day. 

We thought this was a good time to explain why most buildings in New York are owned by LLCs. 

It's standard business practice because building owners try to make sure that every building can operate on its own. If a building is failing, the owner isn't going to use revenue from another building to prop up the failing building. And in many cases, doing so would be illegal, if there are multiple people who finance the purchase of the building.  

We are pushing all of our members to comply with the federal law. They are also complying with a similar state law that requires similar disclosure of LLC ownership. 

[06:03] [Heating buildings in cold weather]

We wanted to end the podcast talking about the cold, cold weather.

It's been the coldest winter in a decade in New York City, meaning high heating bills for building owners, and we're also seeing a spike in renters calling in heat complaints.  

The rules in the winter are: A building must be heated to 68 degrees during the day and 62 degrees at night. 

As we've mentioned here before, New York has some of the oldest buildings in the country. More than half of New York residents live in a building that was constructed before 1947. 

Heating older buildings consistently is difficult, even if you spend a lot of money on energy efficiency upgrades. This is why it may be 68 degrees on the first floor of a building, but 75 degrees on the sixth floor. 

Most property owners monitor heat in their buildings closely. They even have apps on their phone that tell them the temperature of every apartment in every building. They can see when the coldest part of the building is 68 degrees, while other parts are over 75. 

Renters may think the apartment is cold, and they may check the heater and it may not feel warm to the touch, and then they call 311. But in less than 3%of cases, complaints end up with violations. And a large portion of complaints and violations are actually in only 1% of the city's apartment buildings.  

The city sends inspectors to investigate every heat complaint. The city spends tens of millions of dollars a year on heat enforcement. And in the vast majority of cases, a violation is not written because the property manager can show an inspector the temperature for the past 24 hours or longer. 

It's also important to note that heating older buildings is the main driver of greenhouse gas emissions. And increasingly, buildings are fined if they are not energy efficient.

So the two guardrails that owners are up against are: maintaining a certain level of heat as per the law, but of course not producing too much greenhouse gas emissions that would then come along with massive fines. This of course means a very small margin between those two numbers, and many times, tenants may not find comfort in their apartment even at those numbers, which is why we tend to see so many 311 complaints that are not followed by a violation. 

[OUTRO]

That's all the time we have for the podcast today. As always, you can follow us on social media @housingy. On Blue Sky, we are just @housing. 

For our New York listeners, I hope you're enjoying the warm welcome of the 40 degree weather and, of course, the upcoming 7 p.m. sunsets.  

The Housing New York podcast is a proud product of the New York Apartment Association. Please keep sending us feedback on our website or in the comments below. 

You've been listening to Housing New York with Kenny Burgos, and I'll see you all next week. 

And remember, good housing policy starts with good conversation.