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Housing Lotteries Chosen Out of Trash Bags: Liu

Audit finds serious flaws in New York City's affordable housing lottery system.

Housing Lotteries Chosen Out of Trash Bags: Liu

New York City’s affordable housing lotteries are chosen by mixing applications around on the floor, and drawing them from large garbage bags, says a shocking new audit by the office of City Comptroller John Liu.

The audit found that the selection process is vulnerable to errors and fraud.

“It’s shameful that when thousands of New York families desperately need affordable housing their hopes are pinned on the city’s embarrassingly ad hoc and sloppy process,” said Comptroller Liu. “The agency’s recent efforts to automate the housing lottery are welcome, but are long overdue.”

According to the Department of Housing Preservation and Development, the agency received 274,270 applications for the 7,843 affordable housing units that were available through its lottery system in fiscal years 2011 and 2012. Comptroller Liu’s audit, which focused on fiscal year 2011, determined that HPD’s garbage bag lottery was not sufficiently random and created opportunities for error or preferential treatment.

In one instance, auditors found that two out of 11 applicants who were listed as residents of the community board  — and therefore offered first preference in the lottery — were not in fact residents of the community board at all.

The audit also found that the agency verified only the income information of applicants deemed qualified and passed along by the developer. HPD did not check applicants who were rejected by the developer and did not attempt to verify any information other than income from applicants they had already selected. 

In addition, the audit found that HPD failed to properly record and track applicants’ complaints. According to the report, the agency did not ensure that it recorded such basic information for each complaint as the name and address of the complainant, the name of the housing development, and the name of the developer. Of 220 complaints reviewed by auditors, none listed the HPD project manager responsible, and nearly half did not list the complainant’s name, but rather just an email address.

HPD Commissioner Mathew Wambua responded to the audit ( via the New York Post): "Since the 1980s, the lottery system employed by the City of New York helped hundreds of thousands of New Yorkers secure housing. The system has always employed strict controls to ensure our housing is distributed fairly. The comptroller disregarded much of the information we provided, including the fact that over the last year-and-a-half HPD has been working with the Speaker's office to launch an online lottery registration and application tool, NYC Housing Connect. Since the application launched last month, more than 28,000 New Yorkers have registered. HPD cooperated fully with the Comptroller through the audit process; we hope that future exercises of this kind will yield a more accurate, helpful and fair result."

How should the city change its affordable housing placement system? share your ideas in the comments.

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