Dozens of Public Housing Officials Arrested in Record Corruption Bust
More than a third of New York’s crumbling public housing buildings were just implicated in a massive corruption scandal.
Federal prosecutors are charging 70 current and former employees of the New York City Housing Authority on corruption and bribery charges—a single-day record for the Department of Justice.
The no-bid contracts allowed superintendents and their assistants to hire workers directly without going through the bidding process, which is overseen by the city government. The public housing employees would then refuse to sign off on payments to the contractors unless they got a kickback, according to the attorney general’s office.
The employees, who included superintendents and assistant superintendents, allegedly demanded more than $2 million in corrupt payments from contractors in exchange for awarding over $13 million in no-bid contracts.
The corruption impacted vital infrastructure repairs, including plumbing and window repairs, at NYCHA locations across the city—many of which already struggle with supplying the basics, including cooking gas, running water, and mold-free apartments.
“The corruption we’ve alleged infected every corner of the city. As the charges show, superintendents accepting and extorting bribes from contractors had become business as usual, occurring at almost 100 NYCHA buildings across all five boroughs. That’s nearly a third of all NYCHA buildings,” said U.S. Attorney Damian Williams.
Sixty-six of the offenders were arrested Tuesday morning, according to a DOJ press release. All of the charged employees have been suspended immediately, according to NYCHA leadership.
“NYCHA has zero tolerance for wrongful and illegal activity,” said NYCHA Chief Executive Officer Lisa Bova-Hiatt in a statement to TheCity. “The individuals allegedly involved in these acts put their greed first and violated the trust of our residents, their fellow NYCHA colleagues and all New Yorkers. These actions are counter to everything we stand for as public servants and will not be tolerated in any form.”
The bribes pose just another monetary loss for an essential housing system that has been woefully underfunded for decades. According to a 2018 NYCHA assessment, federal capital funding has met only a fraction of capital needs since 2006. In the agency’s 2017 physical needs assessment, a five-year financial trajectory for improvements, NYCHA determined that it’s short $31.8 billion to return its campuses to a “state of good repair.” Failing remediation, by 2023 that number had shot up by 73 percent, with the agency declaring it needed a new 20-year capital investment of $78.3 billion.
Meanwhile, the city is in the thrall of a housing crisis, woefully failing to produce enough homes for its growing population. According to Governor Kathy Hochul’s office, the state will need an investment of 800,000 new homes over the next 10 years—double the rate of production—in order to “make up for decades of underproduction.”
After killing Hochul’s Housing Compact in April, a cohort of progressives within the state legislature are refocusing their attention from rent control and eviction bans to the dire housing need. A new bill, set to be introduced on Thursday, would create a new agency that would build housing using its own money or money raised in the bond market. The shift in conversation is an “acknowledgment from the left that solving the housing crisis will inevitably mean building more homes,” per The New York Times.
