The Real Estate Board of New York to The New York City Council Committee on Land Use Into. 1572 – Requiring a Racial Disparity Report for Certain Land Use Actions

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The Real Estate Board of New York (REBNY) is the City’s leading real estate trade association representing commercial, residential, and institutional property owners, builders, managers, investors, brokers, salespeople, and other organizations and individuals active in New York City real estate. REBNY supports the goals of Intro 1572 to require a racial disparity report for certain land use actions. The impact of zoning on racial disparities warrant attention by the legislative body and study by the City. Thank you to the Council for the opportunity to offer technical comments on the methodology and proposed data sources for such a study.

New York City’s success depends upon increasing our supply of housing, strong infrastructure, and a skilled workforce. Yet, the city has not kept pace with the housing needs of our existing population. The Department of City Planning’s 2019 report The Geography of Jobs1 found that job growth has outpaced housing production by a rate of .28 housing units permitted for each net new job in the last decade, which has resulted in the city adding 362,900 more net new jobs than new housing units produced over two decades. This pressure on existing supply has driven up housing costs throughout the New York City region, which has impacted various races differently, due to disparities that include educational attainment and income. While it is important to study zoning’s impact on racial disparities, it is imperative that their examination does not lead to the suppression of housing construction, which will create further distance between the available supply and demand of housing, in turn increasing housing costs and decreasing opportunities for neighborhood integration. Academics have noted that housing development is not the cause of residential displacement, but rather the symptom of larger economic trends.2 Importantly, research from the Upjohn Institute and Philadelphia Federal Reserve Bank found that new market-rate buildings lower nearby rents 5 to 7 percent and cause more people from lower-income neighborhoods to move in, fostering more integrated and economically diverse neighborhoods.3 It is clear that this academic evidence proves that neighborhood construction can be a force for good if it allows for integration, access to greater employment opportunities and support of local businesses, which should be considered in a racial disparity report. Conversely, we encourage the Council to also consider potential racial disparities caused or perpetuated by restraining housing construction through downzoning’s and historic district designations alike, and how those actions impact residential displacement.

REBNY believes that policy makers should make decisions based on facts and data, and the proposed bills are a step in the direction to make better informed decisions about the City’s growth and equitable development. US Census Bureau Data, including the American Community Survey (ACS), is provided by several surveys at varying geographies and currencies. Some examples of data the US Census Bureau releases that capture different lengths of time or are collected at varying frequencies are ACS 1-year estimates, and ACS 5-year estimates. ACS 1-year estimates include 12 months of collected data and is the most current, but less reliable data, whereas ACS 5-year estimates, are 60 months of collected data and is the most reliable but the least current of all ACS’s.

The US Census Bureau also releases the US Decennial Census, which is released every 10 years. As previously stated, the US Census Bureau releases the Decennial Census and ACS at different levels of geography for different metrics. These geographies capture vastly different numbers of households. Relevant to the bill being heard today, depending on the survey used, information may be available at the block group level or Census tract level. Census tracts, according to the U.S Census Bureau, are “relatively permanent statistical subdivisions of a county or equivalent entity… [that] generally have a population size between 1,200 and 8,000 people.” Comparatively, block groups are not actual city blocks, but are also determined by population size and generally contain between 600 and 3,000 people, and are divisions within a Census tract. In order to protect individual’s privacy, Census data is not available at a household or building level. This restriction makes it impossible to draw an exact half mile radius boundary around a development site, and capture the desired demographic indicators within that boundary.

Instead, due to the fact that both block group and Census tract data are mapped as polygons, any radial boundary will capture households outside of that boundary. The smallest geography available, the block-level data, would allow for the closest precision to a half-mile radius, however it poses the issue of relevancy, as some of the requested metrics are made available by block group only every ten years at the release of the Decennial Census, including median income by race, which is critical to this report. If the Council would prefer more relevant data, such as that distributed in the ACS, the smallest geography median income by race is available by is Census tract. As previously identified, Census tracts can contain between 1,200 and 8,000 people. This means that drawing a half mile radius around a tax lot will in some cases lead to several surrounding Census tracts containing up to 8,000 individuals being captured within the reported data, when only hundreds, or less, individuals live within the half mile radius of the development site. Therefore, given that any analysis should utilize data from the same time period, and that time is relevant to these reporting requirements, it may be preferrable to use ACS data, however the geographies cannot be precise to the half mile radius requirement, as thousands of additional households outside of that boundary will be captured. It may be advisable for the Council to utilize the methodology of CEQR’s Environmental Assessment Survey (EAS) to rectify this technical challenge. The EAS process analyzes population demographics by Census tracts that are 50% within the radial boundary surrounding the development area.

In regard to rent stabilized building data, the most recently available data is provided by the Department of Homes and Community Renewal with a two year delay in PDF format. While the list does include buildings that contain rent stabilized units at an address level, it does not include how many units are rent stabilized within each building, and historic files are not made publicly available. Additionally, PDF files are not mappable, and even if the file can be converted to a CSV to match with a SHP file, the list does not currently contain a BBL field, making the process extremely arduous. An alternative source of data on rent stabilized units is The New York City Housing and Vacancy Survey (HVS), which is released every three years, making it impossible to report on rent stabilized units every four years as required by the text of this bill. Furthermore, the smallest geographic area the HVS is released by is sub-borough areas, which are neighborhoods that map to collections of Census tracts, presenting the same issue of radial boundaries posed by other Census data.

As proposed in the bill and given the aforementioned disconnect between the geocoding and update cycles between the various data sets, the current framework is not conducive to accurate and consistent reporting metrics across development proposals, and does not follow best practices in data truth and reporting. The lack of a consistent standard also leaves individual projects open to litigation on such, which would further delay necessary housing units or preclude them altogether. The obligations outlined in this report will require highly technical expertise and abilities to produce, and it is imperative that the Council meaningfully engage with technical experts at the relevant agencies and in the field in order to establish the data available to developers and at what geographic levels and time periods. This data should be standardized across all reports, and not structured in such a way that each developers consultant create their own unique methodology, so that no two reports can be compared. The input of specialists will be instrumental when determining the value of precision versus currency as it pertains to data, and the implications these decisions will have on the veracity of these reports. One possible solution would be for the City to hold a competition among graduate students obtaining degrees in public policy, urban planning, sociology, statistics, or another related field, in order to generate possible standardized frameworks from individuals who are familiar with the data being discussed presently. For the relevant technical experts to develop an appropriate methodology, we recommend that the effective date of the bill be delayed for six months minimally.

REBNY fully supports the goal of studying the impact of zoning on racial disparities. We recommend that the bill be amended so that the intended goal can be technically attained.

Thank you for the opportunity to provide our comments to the committee.

1 https://www1.nyc.gov/assets/planning/download/pdf/planning-level/housing-economy/nyc-geography-jobs2-1019.pdf

2 https://www.theatlantic.com/ideas/archive/2021/01/anti-growth-alliance-fueled-urban-gentrification/617525/?utm_source=facebook&utm_medium=social&utm_term=2021-01-02T11%3A30%3A44&utm_content=edit-promo&utm_campaign=the-atlantic&fbclid=IwAR2VMxqgLM1EuMHJvh-xDLuJbDK-8XyUuXXMi-5CiEvuY8s2Exp_2IFSTE8

3 https://research.upjohn.org/cgi/viewcontent.cgi?article=1334&context=up_workingpapers