NYCHA official overseeing construction is suspended with pay, pending investigation

After Progress Queens exposed that a cash-strapped NYCHA had paid to make major repairs to project-based, Section 8 buildings that it later sold in secret to a consortium of developers, including a politically-connected real estate firm, the offices of the New York City Comptroller and the Department of Investigation would not comment on the conditions of the sale.  Above, at left, is 930 Halsey Street, and, at right, 55 Saratoga Square, two Section 8 buildings formerly owned by NYCHA in Bedford-Stuyvesant, Brooklyn.  The buildings received major improvements in the time before the buildings were sold in December 2014.  The above photograph is dated September 2014, three months before the structured finance transaction closed.   Source :  Google Earth

After Progress Queens exposed that a cash-strapped NYCHA had paid to make major repairs to project-based, Section 8 buildings that it later sold in secret to a consortium of developers, including a politically-connected real estate firm, the offices of the New York City Comptroller and the Department of Investigation would not comment on the conditions of the sale.  Above, at left, is 930 Halsey Street, and, at right, 55 Saratoga Square, two Section 8 buildings formerly owned by NYCHA in Bedford-Stuyvesant, Brooklyn.  The buildings received major improvements in the time before the buildings were sold in December 2014.  The above photograph is dated September 2014, three months before the structured finance transaction closed.   Source :  Google Earth

By LOUIS FLORES

Raymond Ribeiro, the executive vice president of capital projects at the New York City Housing Authority, or NYCHA, was placed on suspension with pay on Friday, following reports that the New York City Department of Investigation was conducting a probe of NYCHA.

The suspension was first reported in a report published by The New York Daily News.

The nature of the probe was not immediately clear.  A representative of the Department of Investigation declined to comment in response to a request made by Progress Queens for information about the probe.

In the report in The New York Daily News, it was noted that Comptroller Scott Stringer (D-New York City) had notified NYCHA on September 10 that his office had concerns whether the public housing agency was monitoring its contractors performing exterior building work.  Subsequent to that notification, both Comptroller Stringer and Councilmember Ritchie Torres (D-The Bronx), the latter who is the chair of the New York City Council committee on public housing, sent a letter to NYCHA on Monday, demanding improved transparency from the public housing agency.

The press office at NYCHA would not answer a request for comment for this report.

Officials with neither the press office of NYCHA, Comptroller Stringer, nor Councilmember Torres would provide to Progress Queens a copy of the letter sent on September 21.

Furthermore, representatives of the offices of each of Comptroller Stringer and Councilmember Torres ignored requests made by Progress Queens seeking comment for this report.

In a separate reportThe New York Daily News also reported that NYCHA was suing a scaffolding contractor, Metropolitan Bridge & Scaffolds Corporation, seeking the refund of $8 million that the public housing agency had paid to the contractor for having provided scaffolding since 2009.  An attempt to reach an official with Metropolitan Bridge & Scaffolds Corporation was unsuccessful, since its business telephone number at its Woodside, Queens, office is no longer in service.  

In July, the administration of Mayor Bill de Blasio (D-New York City) announced that NYCHA was removing the equivalent of eight miles of scaffolding from 38 NYCHA public housing developments.  Residents had complained that, often, the scaffolding would go up and stay up for years on end for no apparent reason, according to a report published by The New York Daily News.

News of the Department of Investigation probe follow several audits and the use of litigation to attempt to bring reforms to the public housing agency.

Since taking office, Comptroller Stringer has conducted audits of NYCHA that have scrutinised the public housing agency's practise of leaving several hundred apartments vacant, even though there is a long waiting list of people waiting to be approved for public housing.  Comptroller Springer has also been critical of a controversy surrounding the excess ordering of supplies by NYCHA, and the subsequent distressed sale of the supplies inventory, as being examples of wasted public resources.  

Advocates for public housing tenants have sued NYCHA to force the agency to make repairs to its apartment buildings, including the removal of mold.  However, NYCHA has violated the court-supervised settlement agreement in one such lawsuit, according to a report published by The New York Daily News.

Separately, when it was announced that NYCHA had sold a portfolio of project-based, Section 8 buildings, including playgrounds, parking lots, and green spaces, to a consortium of real estate developers, Councilmember Torres was critical of the sale.  Two of the developers with an ownership stake in the consortium, L+M Development Partners and BFC Partners, are both politically-connected to the de Blasio administration.  L+M Development Partners have, in the past, used contractors that have violated worker wage and safety rules, whereas BFC Partners have, in the past, faced allegations of shoddy construction work, according to a report published by The New York Daily News.  In the time following the announcement of the Section 8 sale, City Councilmembers demanded more transparency from the public housing agency, but that transparency has yet to materialize.  And anytime when city officials request more transparency, it is always following revelations of controversy.  It appears that municipal legislators and investigators do not apply a constant and rigid form of oversight in respect of NYCHA.

Government reform activists have long claimed that nonprofit groups or public authorities overseeing public assets have been deliberately mismanaged in order to run public assets into the ground, prompting the distressed sale or privatisation of public assets.  Two cornerstone hospitals, St. Vincent's Hospital in the West Village and Long Island College Hospital in Brooklyn, were deliberately mismanaged in order to drive the nonprofit group owners into bankruptcy, government reform activists have claimed.  In both cases, real estate developers have paid pennies on the dollar to take ownership control over the valuable hospital real estate, with plans for the conversion of the former public assets into luxury housing.

At the #S17 rally outside City Hall on September 17, community activist Michael D.D. White said, in part, of officials, whose intentions have been to deliberately sell-off public assets, "It's the same playbook that they've used :  Under-fund our public assets -- deliberately under-fund them -- drive them into the ground and say, 'Oh, well !  It's not working.  You see, we have to sell it off and privatise.' "  On the day of the rally, Mr. White had been speaking of public libraries, but government reform activists, including notable activist Alicia Boyd, have also said that they have seen this pattern of intentional neglect repeated with respect to hospitals, community gardens, and public housing.

An over-paid $8 million for scaffolding and the sale of $18 million in unused supplies can be audited and probed.  Officials, such as Mr. Ribeiro or Victor Martinez, the latter, who accepted blame for the supplies controversy, can be either suspended with pay or terminated, respectively.  However, senior administration officials, such as NYCHA CEO Shola Olatoye, remain unaccountable to NYCHA tenants or to voters.  NYCHA CEO Olatoye has said that NYCHA will continue to expand its privatisation plans, even if it means overriding the opposition of tenants.  At the same time, the outright privatisation of NYCHA properties, which have involved politically-connected real estate developers, a bidding process that was not made public, the negotiation of sale contracts made in secret, and the sidestepping of requirements of the City Charter, have appeared to have received a free pass from investigators.  Further cloaking the sale of the project-based, Section 8 buildings in secrecy was the fact that NYCHA refused to release transaction-related records requested by Progress Queens.

It is unknown how municipal investigators select which issues of controversy to probe.  As has been repeatedly reported by Progress Queens, there are inconsistencies, sometimes outright abdication, on the part of municipal and state regulators or prosecutors, specifically in how they treat controversies involving government officials and corporations involved in the public-private partnership experiment.  Most significant cases of government corruption are now solely investigated by the federal prosecutors of U.S. Attorney Preet Bharara's office.  Over the week-end, a press official with the U.S. Attorney's Office for New York's southern district refused to comment in response to a request made by Progress Queens to address the relative inaction by local and state prosecutors to probe corruption.