Conflicts of Interest Board punishes a NYCHA blue-collar worker as bigwigs sell off public housing, unchecked

NYCHA maintenance worker was fined over $8,000 for having offered to repair a bathroom ceiling in a NYCHA apartment in exchange for $100.

However, city investigatory agencies remain mum about ethical questions involving the sale by NYCHA of several project-based, Section 8 buildings to private real estate developers.


Carlos Fonseca, a hard-working maintenance employee, who has worked for the New York City Housing Authority, or NYCHA, for almost 20 years, was forced to agree to accept a twenty-five work day suspension without pay for having offered to make a repair at a NYCHA apartment. 

The unpaid work suspension, valued at $8,128 in income that Mr. Fonseca will lose, was the outcome imposed by both the New York City Conflicts of Interest Board and NYCHA.

The allegations of wrong-doing against Mr. Fonseca stem from a deal he made to accept $100 to be paid by a NYCHA tenant in the Mott Haven Houses, a NYCHA housing development located in The Bronx, so that Mr. Fonseca would make a repair to the tenant's bathroom ceiling, according to the Disposition filed by the Conflicts of Interest Board. 

As at the beginning of 2014, NYCHA was struggling to cope with over 400,000 outstanding work orders.  The $100 deal that Mr. Fonseca struck with a frustrated NYCHA tenant dates back to 2012-2013, before NYCHA began to aggressively target its outstanding work orders.  

According to the Disposition, Mr. Fonseca violated rules and regulations, including Section 2604(b)(3) of the City Charter, which forbids a city employee from using "his or her position as a public servant to obtain any financial gain."

The strict scrutiny by the Conflicts of Interest Board of an inappropriate $100 ceiling repair job pales in comparison to the lack of city investigatory interest in the issues raised by a Progress Queens report about the sale of several project-based, Section 8 buildings by NYCHA to a consortium of real estate developers.

City housing officials did not publicly disclose that the cash-strapped agency had spent taxpayer money to improve some of the buildings before their sale, in contradiction to claims by city housing officials that the buildings being sold were too dilapidated for NYCHA to maintain.  It appeared that NYCHA and city officials approved the disposition of the portfolio of buildings by sidestepping the city's Uniform Land Use Review Procedure, or the ULURP process.  Many housing-related officials have ties to some of the private real estate developers.  Furthermore, NYCHA did not provide any transparency in respect of the process the agency used to select which buildings would be sold.

Under the terms of the sale, the city issued $250 million in tax-exempt bonds to finance the sale for the group of private real estate developers.  The generous terms of the sale allow the private real estate developers to keep all of the upside in real estate valuations and rental incomes from the Section 8 buildings. 

In response to a special report by Progress Queens, NYCHA officials have provided a partial response to various questions posed by Progress Queens.  However, NYCHA is refusing to release the charter documents of a series of corporations being used by the consortium to own and maintain the Section 8 buildings.  

A press official with the city's Department of Investigation, which is headed by Commissioner Mark Peters, issued a statement of no comment that was received too late by Progress Queens to have been included in a prior report about the sale. 

No response to a request for comment was ever received by Progress Queens from the city's Office of the Comptroller, headed by Scott Stringer (D-New York City).

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