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De Blasio Affordable Housing Plan Seeks To Diversify Community Incomes

NEW YORK (CBSNewYork/AP) -- New Yorkers were talking Thursday about Mayor Bill de Blasio's $41 billion plan to preserve or create affordable housing.

As CBS 2's Tony Aiello reported, the details of the plan – announced earlier this month – were still being worked out as of Thursday. But one goal is clear – to diversify the socioeconomic mix in many neighborhoods.

"We have a crisis of affordability on our hands. It touches everyone from the bottom of the economic ladder, all the way up to the middle class. And so we are marshaling every corner of government and the private sector in an unprecedented response," de Blasio said on May 5. "This plan thinks big – because it has to. The changes we are setting in motion today will reach a half-million New Yorkers, in every community, and from every walk of life. They will make our families and our city stronger."

Click here to read the full plan

De Blasio said it's the biggest housing program "initiated by any city in the history of the U.S."

Some areas have become mixed-income communities naturally. Sunset Park, Brooklyn suddenly has become a housing market with lots of new faces such as Ed Badillo.

"Rent has been going up – it's getting ridiculous," Badillo said. "A studio apartment is over $1,500."

Andy Mac is one of the new faces – a transplant from Park Slope.

"My apartment here is very nice, and the cost of having this apartment in Park Slope would have been almost double the rent," Mac said. "So, it's right off the R Train -- it's a good neighborhood."

The socioeconomic mixing in Sunset Park is happening naturally. But Mayor de Blasio wants his housing plan to engineer even more income diversity – with plans to require developers to build low-income housing units in middle-class neighborhoods and vice versa.

"The middle class won't like it, but you know, you've got to give it a try," Badillo said.

The mayor campaigned last year on helping middle-class and poor New Yorkers, and housing costs have crystallized the squeeze they face.

In a city where renters make up two-thirds of the roughly 3 million households, median rent rose 11 percent between 2005 and 2012 to $1,216 a month, while renters' median household income rose only about 2 percent, to $41,000, according to research by New York University's Furman Center for Real Estate and Urban Policy and Capital One Financial Corp.

In terms of specifics, the mayor has vowed to pursue mandatory inclusionary zoning, or requiring developers to include affordable units if they want permission for bigger buildings or other breaks.

De Blasio's administration also wants to legalize some illegal basement apartments, fight Albany for more rent-controlled apartments and direct $1 billion of city pension funds to building lower-rent units, among other ideas.

But Howard Husock of the Manhattan Institute said the mayor can accomplish economic integration more easily by supporting a Bloomberg-era plan to build market-rate housing on parking lots at New York City Housing Authority developments.

"That is by far the lowest-hanging fruit available, and it would bring rich and poor together in exactly the way they want to do it," Husock said.

The mayor has been critical of the idea, but has not completely rejected it.

De Blasio has already revisited a Bloomberg-era plan to redevelop a Brooklyn sugar refinery, striking a deal to boost 660 affordable apartments to 700 and make more of them two- or three-bedroom. In exchange, the planned buildings -- 2,300 apartments in all -- will be allowed to grow by 20 stories.

Developers understand that affordable housing is now a City Hall priority, and "we're optimistic that inclusionary housing will be a legitimate tool,'' Steven Spinola, president of the influential Real Estate Board of New York, said on May 5. But he says landlords would need incentives -- like getting to build bigger -- to make projects feasible with lower income limits.

Department of Housing Preservation and Development Commissioner Vicki Been testified about the plan at a City Council budget hearing on Wednesday, according to a published report.

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