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City Sends More Homeless Families to Shelters Inside Apartment Buildings

By Patrick Wall | January 8, 2013 9:16am

NEW YORK — Even before a raging fire forced 40 families to flee their Bronx apartment building last month, some were eager to leave.

Fatoumata Gassama, a mother of six, said roaches and rodents infested the building at 941 Intervale Ave. in Longwood.

Kristin Davis said she endured a leaky roof, moldy walls, sparking electrical outlets and unreliable heating in the apartment there she shared with her wife and five children.

“You name it, it was wrong,” said Davis, 26, a home daycare worker. “No matter how many times you told them, it was never fixed.”

Nearly a dozen other tenants said that longstanding hazards throughout the building — from mattresses in the hallways, to empty extinguishers and faulty fire escapes — endangered residents during the Dec. 9 blaze.

Despite the building's condition, all 40 families had been placed there by the city.

The tenement is a type of homeless shelter — one of dozens of privately owned residential buildings across the city where the Department of Homeless Services pays up to $3,565-a-month to temporarily house homeless families in apartments, often alongside renters.

The Intervale Avenue building is also home to a half-dozen rent-paying tenants, and at least one has reported pressure from the landlord to move. Some suspect this is because the owner can collect far more per room from the city than from a tenant in a rent-stabilized apartment.

Critics say this scenario — poor living conditions for homeless families and harassment of renters — plays out in many of the apartment buildings where DHS sends its clients.

What’s more, critics say, by converting private apartments into temporary shelter sites, the city is tightening the rental market and making it more difficult for families to find affordable housing.

Despite years of criticism, DHS is continuing to expand the program, which it calls cluster-site housing, to make room for the record number of homeless.

Last year, DHS placed homeless families in 2,011 cluster-site apartments, up from about 1,500 units in 2009 and 50 when the program began in 2000, according to the department. At an average daily cost of about $106 per contracted unit, the city spent an estimated $77.8 million on the program last year.

“I can understand the kind of pressure the city is under to find housing,” said Sally Dunford, executive director of the West Bronx Housing and Neighborhood Resource Center, noting that more than 47,000 people currently rely on the shelter system.

But cluster-site housing “is so short-sighted,” Dunford said. “It’s a Band-Aid — but it’s not even a great Band-Aid.”

Almost since its inception, advocates have denounced the program, originally called scatter-site housing, as a taxpayer-funded gift to landlords that sends needy families to shabby buildings.

A 2003 report by the public advocate labeled the program “scatter brain housing” and called conditions at one site “horrific.”

Under pressure, then-DHS commissioner, now-Deputy Mayor Linda Gibbs promised that year to phase-out the program. Eventually, the agency reconfigured it as cluster-site housing by adding certain safeguards, such as building inspections and third-party operators.

Today, DHS pays a handful of private agencies to find and lease apartments, oversee maintenance by the landlords and provide certain services to the DHS tenants, including caseworkers to help with job and apartment hunting.

These contractors operate 1,424 cluster-site units in The Bronx, 484 in Brooklyn and 103 in Manhattan. The city pays them up to $115 each day per unit, which covers the cost of rent and services.

The Intervale Avenue site is run by Aguila Inc., a nonprofit that operates at least 225 Bronx cluster-site units.

Last fiscal year, Aguila collected about $28.5 million from the city, according to tax records. The company’s CEO is Robert Hess, a former DHS commissioner.

In 2011, an audit by the city comptroller found that Aguila-operated sites had more than 1,700 open code violations related to “hazardous conditions,” which “compromised buildings’ structural integrity and fire safety.” The audit also faulted DHS for its lax oversight of Aguila.

The Intervale Avenue building has 22 open code violations, according to city records.

Aguila referred media inquiries to DHS.

DHS did not respond to specific questions about the Intervale Avenue site, but a spokeswoman said agency inspectors evaluate buildings before they are used as cluster sites.

Some advocates also say that cluster-site tenants do not always receive mandated support.

A 2009 city comptroller audit of Basic Housing Inc., which currently operates 598 cluster-site units, found the nonprofit did not consistently provide social services to all its clients, which impeded “their efforts to obtain permanent housing and become self-sufficient.” (In a response to the audit, Basic Housing said it would increase supervision of its caseworkers.)

For renters in cluster-site buildings, the program can cause a different set of headaches, critics say.

Longtime tenants may find 24-hour guards, guest logs and new, transient neighbors in their buildings with little warning. DHS only provides notification when it plans to lease half or more of a building’s apartments, according to agency policy.

A greater concern to many is that the program encourages landlords to force out renters — through legal threats or rent hikes, or by refusing to make repairs — in order to obtain a more lucrative lease from a city-contracted operator.

One longtime renter at 941 Intervale Avenue recently visited the office of State Sen. Ruben Diaz Sr. and said the landlord was “harassing” them to leave the building, according to Diaz’s office manager, Helen Reyes Jacome. The tenant pays $900-a-month for the apartment.

“Basically what [the landlord] said is, ‘Take $6,000 and move out, or stay and you don’t get your apartment fixed,’” said Rafael Salamanca Jr., district manager of the local community board, who also met with the tenant.

The building owner, 941 Intervale Realty LLC, did not return phone messages.

DHS did not respond to specific questions about that site either. But a 2003 agency memo informs potential cluster-site operators that apartments “must be vacant and there is no evidence of harassment or eviction of existing tenants.”

Still, the incentives for landlords to clear out renters remain, advocates say.

“They can instantly make the building more profitable by getting a contract with DHS and turning them into part of the shelter system,” said Gregory Lobo Jost, deputy director of the Bronx-based University Neighborhood Housing Program.

What’s worse, most of the Bronx cluster-site units had been rent-stabilized apartments, Jost said, which are “difficult to replace, if not impossible.”

Rather than convert affordable apartments into temporary shelter space, the city should provide subsidies for families to move into long-term housing, which would ultimately save the city money, critics say.

The city ended its rental subsidy program for homeless families, called Advantage, in 2011 after it lost state and federal funding.

But critics say the city could afford to fund such a program on its own.

“If the city wants to create a rent-subsidy program, it could do that,” said Patrick Markee, senior policy analyst at Coalition for the Homeless.

He noted that Advantage offered homeless people who found jobs rental vouchers worth up to $1,000 a month — less than a third of the cost of housing families at a cluster site.

Davis, the homeless mother of five, said she had just paid the security deposit for an apartment and picked up the keys when she learned Advantage was ending and had to cancel the lease.

That was the spring of 2011. Nearly two years later, the Davises are still in the shelter system.