NYHC issued a policy brief examining NYC’s Office of Management and Budget (OMB)’s role in housing production and made recommendations to make the process more efficient.
OMB plays an important role in planning and overseeing the three parts of the City’s $115.9 billion budget: expense, capital, and revenue. Yet, in its role overseeing the budget of nearly 90 City agencies and entities, OMB is too often duplicating agency efforts, in this case of the Department of Housing Preservation & Development (HPD), undermining their expertise and unnecessarily delaying operations and affordable housing production.
OMB does not allow HPD to independently manage its budget or fund projects in the programs following approved term sheets. Thee policy brief includes examples of heavy-handed and redundant reviews which undermine agency experts and drag out development timelines and drive-up costs, while wasting staff time, including:
- Duplicative Underwriting: Even if projects comply with the term sheets approved by OMB, OMB conducts their own underwriting review of each project receiving capital funding with a 40+ question document.
- OMB Mission Creep: When the City faced fiscal pressures due to the COVID-19 pandemic, OMB began imposing limitations and project level reviews on discretionary authority. This contributed to HPD’s lengthy preservation pipeline (estimated at 250 projects currently) and impacts their ability to clear it.
- Personnel Approvals: HPD includes its personnel spending plans in its annual budget submission to OMB for approval. However, in none of HPD’s 12 offices can managers hire or promote staff on their own. Instead, OMB must review and approve each new staff hire, raise, and promotion. HPD currently has 405 vacancies, and OMB will approve each hire and any subsequent promotions or raises.
How to Fix It: Mayor Elect Mamdani should limit OMB’s role to approving HPD’s annual budget and programs with significant budget implications, such as the housing finance program term sheets.