AG James, Comptroller Stringer, And 32Bj President Bragg Return More Than $400,000 In Recovered Wages To Building Service Workers

  Attorney General Letitia James, New York City Comptroller Scott Stringer, and 32BJ SEIU President Kyle Bragg today distributed more than $400,000 in back wage plus interest to 11 building service employees who were cheated out of their prevailing wages for work at a luxury apartment building in Downtown Brooklyn. In November 2019, Attorney General James and Comptroller Stringer announced a historic $2.9 million settlement with the developers and landlords of 180 Nassau Street, Brooklyn Warehouse 180 LLC and Mica Gabe Brooklyn LLC, for willfully violating prevailing wage requirements under the New York State Section 421-a tax exemption program by underpaying building service employees and withholding supplemental benefits. The workers at the building were represented by whistleblower 32BJ SEIU, who notified the Attorney General’s Office and the City Comptroller’s Office about the violations.

The settlement, which provided recompense for the building service employees, was approved by the Department of Housing Preservation and Development (HPD), which administers the tax exemption program in the City of New York. The 11 workers received various amounts based upon their hours worked and date of hire, ranging from $5,500 to $80,000. 

“There is zero tolerance for cheating workers out of their hard-earned pay,” said Attorney General James. “As a result of our investigation, we were able to secure hundreds of thousands of dollars for these workers – payment that they should have received long ago. I thank the Comptroller and 32BJ for their partnership in holding these bad actors accountable and ensuring that our workers get the pay they deserve.”

“In New York City, the dignity of work matters and we will never stand idle when hard-working New Yorkers are exploited or underpaid,” said Comptroller Stringer. “Today, these 32BJ SEIU members received the wages they earned and the justice they deserve – and we’re sending a clear message to unscrupulous developers, contractors and landlords that they better follow the rules when they get millions of dollars in property tax breaks. I am proud of the collaborative effort between my office, the Attorney General’s Office, HPD and 32 BJ SEIU, which allowed us to recover these wages and put them back where they belong — in the hands of working New Yorkers to provide for their families, just in time for the holidays.”

A joint investigation conducted by the Office of the New York Attorney General and the Office of the New York City Comptroller revealed that, in 2014, defendant Mica Gabe fraudulently induced the New York City Department of Housing Preservation and Development (HPD) to issue a Section 421-a partial tax exemption for the Brooklyn property, based on Mica Gabe’s false assurance that building service employees would be paid prevailing wages, but the two defendants failed to pay the applicable wages to employees between August 2014 and March 2016. In fact, less than two weeks after certifying to HPD that they would pay the building service employees prevailing wages, Mica Gabe began hiring doormen, porters, and a superintendent for the 180 Nassau Street property and paying them wages lower than required by law.

"Attorney General James, Comptroller Stringer, we thank you for upholding the law on behalf of working New Yorkers,” said 32BJ SEIU President Kyle Bragg. “This is a huge victory, not only for the hardworking men and women who have kept Brooklyn Warehouse clean, safe and functioning for tenants, but also for the families and communities that rely on them. The back wages will help Brooklyn Warehouse’s concierge, superintendent, doormen, porters and other building service workers get back on their feet after being grossly underpaid. This also sends a clear message to employers across the city that workers’ wages and benefits must be paid properly. It’s not an option to break the law at the expense of working people in our state."

“Today, these workers who were not given their due were made whole thanks to the City and State’s joint enforcement efforts,” New York City Department of Housing Preservation and Development Commissioner Louise Carroll said. “I commend the Office of the Attorney General and the Comptroller for their work to do right by this city’s workers and ensure that property owners across New York know that if they violate the law there will be consequences.”

Section 421-a of the New York Real Property Tax Law grants tax breaks on certain new multi-unit residential buildings. To qualify, Section 421-a requires that any project receiving the tax exemption be subject to local rent stabilization laws and — where projects contain at least 30 units — requires developers to either pay prevailing wages to building service workers or set aside a number of affordable housing units. 

For their violations of Section 421-a and the New York False Claims Act, the two defendants paid the full back wages to workers, along with 16-percent interest, in addition to over $2.5 million in damages to the city and state. Union 32BJ SEIU, the whistleblower that came forward to report the fraud, also received a percentage of the damages to be paid.

In connection with the November 2019 settlement, the defendants admitted to violating the New York False Claims Act, as well as a willful violation of the Section 421-a prevailing wage regulations. In addition, Brooklyn Warehouse is required to ensure that the prevailing wage regulations are followed in the future by providing the Office of the Attorney General with annual wage reports, and must show that any subsequent purchaser has agreed to comply with the prevailing wage requirements of Section 421-a.

The 10-story luxury apartment building at 180 Nassau Street in Downtown Brooklyn includes 103 luxury rental units with a 24-hour concierge-attended lobby, as well as a superintendent, doormen, porters, and other building service employees who service and maintain the property.

The Office of the New York Attorney General wishes to thank the Office of the New York City Comptroller, the New York City Department of Housing Preservation and Development, and Corporation Counsel for their valuable assistance in this investigation. The investigation began after local union 32BJ SEIU notified the Attorney General's Office of the underpayment of wages and fraudulent inducement of Section 421-a tax exemptions, filing a suit under the New York False Claims Act.

Comptroller Stringer, State Senator Krueger and Assemblymember Linda B. Rosenthal Introduce Legislation to Raise Awareness of Rent Freeze Program for Seniors and People With Disabilities

State legislation would require that a tenant be given formal notice on potential eligibility for SCRIE and DRIE rental assistance program

Bill would assist many seniors and people with disabilities living on limited incomes and facing high rent burden

New bill could help up to 26,000 seniors and people with disabilities access rental assistance

  New York City Comptroller Scott M. Stringer, State Senator Liz Krueger and Assemblymember Linda B. Rosenthal announced the introduction of new legislation (A.7730) to raise awareness of the Senior Citizen Rent Increase Exemption (SCRIE) and Disabled Rent Increase Exemption (DRIE) programs that assist seniors and New Yorkers with disabilities who are living on limited incomes in making rent payments. The legislation would require that seniors and tenants with disabilities be given formal notice of potential eligibility for the program at the same time as they receive routine communications from landlords or government agencies regarding such issues as an application for a rent adjustment due to a major capital improvement, a rent increase, or notice of a new lease or renewal of a lease. The programs enable income eligible tenants to have their rents frozen at one-third of their incomes, or the rent paid on the lease before they applied, whichever is greater. Both SCRIE and DRIE are under-enrolled, with less than half of all potential beneficiaries registered in the program. The legislation introduced today would help bolster enrollment in these critical programs and ensure more who qualify for assistance actually receive it.

“We need to help the New Yorkers who built up our communities and ensure they can afford to stay here, with access to affordable housing that will allow them to age in place and thrive in their golden years.” said New York City Comptroller Scott M. Stringer. “That’s why we must tackle our City’s affordability crisis head-on by providing direct support to New Yorkers with disabilities and our City’s seniors — those who are struggling the most to make their monthly rental payments. Increasing enrollment in the SCRIE and DRIE programs is a much-needed subsidy that must be extended to serve every New Yorker that needs it. As the original sponsor of DRIE legislation during my time in the New York State Assembly, I want to thank State Senator Liz Krueger and Assemblymember Linda Rosenthal for sponsoring this important legislation and for working to ensure that our most vulnerable tenants receive the rental assistance they need to make ends meet.”

”The SCRIE and DRIE programs have allowed thousands of older New Yorkers and people with disabilities to stay in their homes and age in place with dignity,” said State Senator Liz Krueger. “But thousands more are struggling to pay the rent without even knowing these programs exist. This bill ensures that some of our most vulnerable neighbors will get the vital information they need to ease their rent burden. Thank you to Comptroller Stringer and Assemblymember Rosenthal for championing this important effort.”

“The Rent Freeze Program is a critical lifeline for this city’s senior and disabled tenants, but only if senior and disabled tenants know it exists,” said Assemblymember Linda B. Rosenthal. “This bill will help promote awareness of the existence of the Rent Freeze program, and provide so many vulnerable tenants with desperately needed rent relief. I look forward to working with Comptroller Stringer and State Senator Krueger to see this bill become law.”

The new bill stems from a 2017 report by Comptroller Stringer, entitled “Aging with Dignity: A Blueprint for Serving NYC’s Growing Senior Population,” which outlined recommendations regarding the City’s plan to respond to changing demographics on a neighborhood-by-neighborhood basis to better serve New York City’s growing senior population. One of the proposals in the report was to help promote awareness of the City’s SCRIE and DRIE programs to freeze rent levels for eligible seniors and New Yorkers with disabilities struggling to pay their monthly rent.

S.6210/A.7730 also requires routine communication from landlords or government agencies such as an annual certification required by Section 31 of the Private Housing Finance Law, a lease rider, a lease containing an escalator clause, a maximum base rent adjustment or heating fuel cost adjustment, or an annual or otherwise periodic 2.2 percent rent increase for buildings receiving benefits pursuant to Section 421a of the Real Property Tax Law, to include formal notices about potential eligibility for SCRIE or DRIE.

To qualify for the SCRIE program, individuals must be 62 years of age or older, earn $50,000 or less annually, pay more than a third of their monthly income in rent, and reside in an apartment that is hotel-stabilized, Mitchell-Lama, rent-controlled, or rent-stabilized. New Yorkers with disabilities can qualify for the DRIE program if they are not able-bodied and are 62 years of age or younger. Based on New York City Department of Finance (DOF) data, in FY16, 59,524 persons were enrolled in SCRIE and 10,743 in DRIE compared to the population of an estimated 121,729 potentially eligible SCRIE recipients and 33,637 potential recipients eligible for DRIE. A notification expansion of this scale could increase SCRIE enrollment from its current 49 percent participation rate to approximately 70 percent, benefiting 26,000 seniors.

“Aging with Dignity: A Blueprint for Serving NYC’s Growing Senior Population” Report

Comptroller Stringer’s report, “Aging with Dignity: A Blueprint for Serving NYC’s Growing Senior Population,” outlined three main recommendations to address the needs of the City’s growing senior population including creating safe, healthy, and affordable housing options in which seniors can grow old; developing livable communities for seniors, and supporting the wellbeing of older New Yorkers. It also found that:

• Between 2005 and 2015, the City’s population of adults over 65 increased by about 182,000 – from approximately 947,000 to 1.13 million – a rise of more than 19 percent
• In 2015, adults over 65 composed about 13.2 percent of the City’s population, up from about 11.9 percent in 2005 with the population being most significant in Brooklyn, followed by Queens, Manhattan, the Bronx, and Staten Island
• Between 2005 and 2015, the number of working seniors in New York City grew by 62 percent, and during that same time, the share of seniors in New York City’s labor force grew from 13 percent to 17 percent
• Over 40 percent of New York City senior-headed households depend on government programs (including Social Security) for more than half of their income, while more than 30 percent depend on these programs for three-quarters of their income
• A higher percentage of seniors receive government assistance than the general population:
  • Nutrition assistance (25.5 percent)
  • Supplemental Security Income (14.6 percent)
• Seniors are more likely to pay in excess of 30 percent of their income on housing than the total population, regardless of whether they rent or own their homes

Comptroller Stringer, Council Members Cohen and Rivera Introduce Legislation Bolstering Rights of Tenants in Housing Search Process

Bill would mandate landlords or leasing agents requesting an application fee for a credit check to share the report with the applicant

Bill would also mandate that prospective tenants not be charged a fee for a credit report unless the rental unit is available at the time of screening

Legislation would help New Yorkers learn more about their credit history at the moment when it most matters

  New York City Comptroller Scott M. Stringer joined Council Members Andrew Cohen and Carlina Rivera in proposing legislation (Int 1499-2019) at the New York City Council that would require any landlord or leasing agent that charges a prospective tenant a credit check fee to share that credit report with the applicant, regardless of whether a lease is signed. The proposed legislation would grant prospective tenants unprecedented access to their credit history at the moment they need that information the most. The bill would also mandate that prospective tenants not be charged a fee for a tenant screening report unless the rental unit is available during the time period that a renter is looking to occupy the dwelling, helping protect tenants from unfair fees that are charged by leasing and acting agents.

Int 1499-2019 stems from a 2017 report by Comptroller Stringer, entitled “Making Rent Count,” which aimed to help New Yorkers lift their credit scores, save money, and alleviate deep disparities in credit histories across the city. The report showed how adding rental information to credit files can help boost credit scores for New Yorkers and reduce credit disparities. While consumers can generally request a limited number of free credit reports from credit bureaus, it is common practice that landlords and leasing agents charge housing applicants a fee to perform a more comprehensive check, passing on the cost to the applicant without disclosing the results of the report.

“When a tenant hands over an apartment application fee to have their credit history reviewed by a landlord or leasing agent, they deserve to have access to that credit report. The process of finding and qualifying for an apartment is exactly when a tenant needs their credit information the most and this bill would provide crucial insight into the health and accuracy of tenants’ credit and financial histories,” said Comptroller Stringer. “Helping New Yorkers take control of their credit is critical to solving the affordability crisis by helping consumers gain new financial opportunities, reduce costs of borrowing, and save money. I want to thank Council Members Andrew Cohen and Carlina Rivera for sponsoring this important legislation to ensure that all tenants have access to their credit information. Credit is at the core of upward mobility and financial empowerment, and it should not be taken for granted.”

This legislation, which will financially empower New Yorkers by granting them with more holistic credit information, is part of the Comptroller’s “Making Rent Count” initiative. To date, the Comptroller has launched a series of pilot projects that enable participating residents to opt-in to have their monthly rent payments count toward their credit scores, just as mortgage payments do for homeowners – helping tenants take control of their credit and secure better rates for loans, insurance, cell phone bills and more. The initiative has expanded to 2,600 apartment units, split between the Banana Kelly Community Improvement Association in the Bronx, Ocean Bay Apartments in Queens, and the Grand Street Guild Apartments in Manhattan.

“This piece of legislation aims to protect New Yorkers from the unscrupulous practices used by some real estate agents that try to make extra money off the backs of people seeking apartments,” said Council Member Andrew Cohen. “There are too many barriers and fees involved in the process of finding an apartment in New York City, and these confusing practices disproportionately affect low-income residents. We must continue to find ways to protect our most vulnerable New Yorkers from these abusive practices. I am proud to partner with Comptroller Scott Stringer and Council Member Carlina Rivera on this important piece of legislation.”

“We need to demystify the apartment-hunting process in New York, and part of that is giving New Yorkers the chance to know what the credit scores used in their rental application actually are,” said Council Member Carlina Rivera. “I want to thank Comptroller Stringer and Council Member Cohen for being partners in the fight to bring real accountability and access to the rental industry.”

“Making Rent Count” Report

The benefits of incorporating rent payment information into credit files are detailed in the Comptroller’s October 2017, “Making Rent Count” report, in which the Comptroller’s Office studied a representative sample of city tenants paying rents under $2,000 and found that reporting rent history would:

• Raise credit scores for 76 percent of New York City renters who currently hold a credit score. Specifically: 
• More than half (57 percent) would see their score rise between 1 and 10 points
• Nearly one in five (19 percent) would have their score boosted by 11 points or more
• 18 percent would see no change at all
• 6 percent would see a possible decline in their scores
• Provide nearly 30 percent of renters with a credit score for the first time. The average new score for these mostly low-income renters — now categorized as “invisible” or “unscorable” because of the relative dearth of financial information in their credit files — would be a prime score of 700.

Comptroller Stringer, Council Member Brannan and Advocates Call on City Charter Revision Commission to Make Sweeping Changes as Thousands of Non-Profits Go Unpaid by the City for Months

New Comptroller Stringer report shows administration submits 89% of City contracts for human services – serving the most vulnerable New Yorkers – late for registration, after the contract start date

In FY18, contracts submitted over a year late for registration were on average 589 days late

Coalition calls for strict contract processing timelines and new, transparent tracking system for all contracts

  New York City Comptroller Scott M. Stringer and Council Member Justin Brannan, joined by a coalition of advocates and non-profit organizations, called on the City Charter Revision Commission to make significant procurement reforms in the City Charter as a new report issued by the Comptroller’s Office, Still Running Late, found pervasive delays in the City’s contracting system. These delays are especially rampant among human services contracts – the main focus of the Comptroller’s report – with 89% of new and renewal contracts being submitted late for registration, which delays payments by the City. Yet, this problem does not only affect human services contracts – 80% of new and renewal contracts across all agencies and industries were submitted late in FY 2018.

Delayed contract registration causes serious problems because vendors can only receive payment once a contract is registered. The situation is particularly dire for non-profit human service organizations that serve some of the City’s most vulnerable populations – including seniors, the homeless, and children. Despite working with limited resources, these mission-driven organizations do not stop delivering meals to homebound seniors or providing shelter to homeless families when their contracts aren’t registered. Instead, cash-strapped non-profits often take out loans or put themselves at financial risk to continue offering services until contracts are registered and they can be paid.

“Non-profit organizations are the backbone of our city, supporting hundreds of thousands of New Yorkers that rely on them for food, shelter, and in some cases, survival. Yet many of the organizations these New Yorkers rely on are just one step away from financial disaster, and it’s a crisis of the City’s own making,” said Comptroller Stringer.  “We must pay these organizations on time for the services they deliver. That’s why we need to reform our city’s contracting system to make sure contracts are reviewed and registered within strict timeframes, and that the process is transparent. The City Charter Commission has a real opportunity to not only help non-profits, but the residents who rely on their services.”

“Our city’s human service providers are in crisis due to a badly broken procurement system. We cannot continue asking these vital non-profit organizations to do more and more with less and less when we rely on them to provide essential services to New Yorkers who need it most. These organizations need to be paid on time and paid fairly for the critical work they do. Comptroller Stringer’s report clearly demonstrates that major reforms are needed to right this wrong. I strongly support the reforms laid out in the report and urge the City Charter Commission to act immediately,” said Council Member Justin Brannan.

The City’s procurement process involves oversight from a number of agencies before a contract can be registered with the Comptroller’s office. While oversight is crucial, the length of time it takes for a contract to work its way through all stages of review – most of which do not have deadlines – is a primary source of contract delays. Making matters worse, there is no public-facing system for tracking contracts as they make their way through the various stages of review, leaving non-profits and other vendors in the dark about the status of their contracts.

Vital Services Threatened by Late Human Services Contracts

The Comptroller’s report examined human services contracts, and found the City administration submitted 89% of them for registration after the contract start dates had already passed, and that more than half of these contracts were late by more than six months. What’s more, the latest contracts – those that were submitted by the City for registration more than one year after the contract start date – were even later in FY18 than they were in FY17, by an average of 37 days.

The report analyzes 2,262 human service contracts submitted by the administration for registration after their start date in FY18. As the chart below illustrates, over 52% of these contracts were submitted for registration six months or more after the contract start date had already passed (32.4% were more than six months late and another 19.7% were over a year late). Meanwhile, of the almost 20% of human service contracts that were submitted over one year late, the average number of dates late was a whopping 541.

Timeframes Work but are Non-Existent for Most Oversight Agencies

While the Comptroller’s report found widespread problems in the agency contracting process, by comparison, the analysis found that once contracts are submitted to the Comptroller’s Office by City agencies, 96% were registered within 30 days, as required by the City Charter.

To help alleviate the burden placed on non-profits and other vendors that wait months for contracts to make it through the City’s review process, Comptroller Stringer is calling on the City Charter Revision Commission to advance reforms including:

Instituting strict timeframes for City agencies with an oversight role in the procurement process to complete their tasks.

The Comptroller’s Office is currently the only agency with a role in the City’s procurement process that performs its duties within a specified timeframe (30 days). All other oversight agencies perform their tasks without mandated timeframes, or with timeframes that can be easily waived, which leads to a drawn out process and a lack of accountability among agencies.

Creating a transparent contract tracking system that would allow vendors to view the status of their contracts.

Non-profits and other vendors that do business with the City of New York have very limited visibility into the contracting process. Most vendors typically wait many months or longer for a contract to be registered, but have no idea what is actually happening to their contract during that time. To increase transparency, the City should create a tracking system that allows vendors to follow their contracts throughout each stage of the procurement process, and track how much time each agency is taking to execute their tasks.

Comptroller Stringer, State Senator Kavanagh, Assemblymember Simon, Council Member Levin and Brooklyn Communities Rally for a Better BQE

Coalition demands greater transparency and community engagement during planning of upcoming Brooklyn-Queens Expressway reconstruction

Rally follows Comptroller Stringer’s letter to Mayor’s office, DOT

  Today, New York City Comptroller Scott M. Stringer, State Senator Brian Kavanagh, Assemblymember Jo Anne Simon, Council Member Stephen Levin, A Better Way NYC, Brooklyn Heights Association, Cobble Hill Association, Cadman Towers, and community leaders demand more transparency and community engagement from the City during the rehabilitation of the Brooklyn-Queens Expressway (BQE).

Last year, the City’s Department of Transportation (DOT) announced two potential options to repair the triple-cantilevered section of the BQE. The first would replace the Brooklyn Heights Promenade with a six-lane highway for up to six years while the permanent highway is reconstructed below. The second would be a conventional lane-by-lane construction project, which would take longer, involve nighttime and weekend work, and likely flood local streets with thousands of trucks and cars diverted during construction.

While these repairs are necessary and urgent, DOT has failed to devise sufficient alternatives to the current proposed BQE redevelopment plan. The coalition called on the City to open the planning process and consider a wider range of construction options.

The rally comes after Comptroller Stringer issued a letter to Mayor Bill de Blasio expressing concern that the City has failed to consider community needs and provide transparency regarding alternatives to the renovation plan. Congressmember Nydia Velazquez, State Senator Kavanagh, Assemblymember Simon and Council Member Levin also issued a statement as an update on their conversations with DOT and the community.

“When the City plans a massive years-long project, their top priority should be transparency,” said Comptroller Stringer. “No project can succeed without community input and the planning process for the BQE renovation has failed that basic standard. The City must consider a wider range of options to ensure this project does not unnecessarily burden the Brooklyn Heights community.”

“Reconstructing the BQE will be an enormous undertaking, but long before the City settles on a plan and the first shovel hits the ground, we need an equally expansive effort to get the design, the construction method, and the process right,” said State Senator Brian Kavanagh. “That’s why from the first day this project was announced to today, I’ve joined my elected colleagues and many local organizations and residents calling upon the DOT to explore every feasible alternative option and to give every affected community a full opportunity to have their needs and concerns considered. The DOT has met with us and has shown signs that they are willing to do just that. We know we have to keep our communities engaged and keep the pressure on, so I’m proud to stand with Comptroller Stringer, Congressmember Velazquez, Assemblymember Simon, Councilmember Levin, the Brooklyn Heights Association, the Cobble Hill Association, and many other concerned New Yorkers, to renew our call for a full, thorough, transparent process.”

“I am glad to stand with Comptroller Stringer, my partners in government, and with community residents to ensure our communities’ voices are heard and that all feasible options for the reconstruction of the BQE are rigorously examined. I am encouraged that DOT has begun engaging in small group meetings with those who will be most affected by the reconstruction and that DOT is open to considering alternative plans to its two existing proposals, but we need greater transparency and engagement at every level of this process,” said Assembly member Jo Anne Simon.

“DOT’s proposed innovative approach has revealed several concerning impacts on the surrounding community, and a better way is needed. I appreciate DOT’s efforts as they explore alternative options and I urge them to continue to work with community stakeholders to find a solution that’s in the interests of everyone,” said Council Member Stephen Levin.

EDITOR'S NOTE:

Comptroller Stringer is entering his sixth year as New York City Comptroller, This highway in Brooklyn has not gotten into the situation it is now overnight. One thing this coalition fails to recognize is that this highway will be a major route to and from the new Amazon Queens headquarters, and that is why the NYCDOT is doing repairs on it. 

Where is Comptroller Stringer on the fate of the Cross Bronx Expressway. A major route from mainland United States to the Bronx, Long Island and New England. The Cross Bronx Expressway is mostly a large parking lot that is carrying a load much greater than it was built for. Where is the NYCDOT plan to fix the Cross Bronx Expressway?

What you should be asking City Comptroller Scott Stringer is why he is trying to pander to some Brooklyn Heights residents that he wants their vote from in the next mayoral election. Why is Comptroller Stringer not concerned with the Cross Bronx Expressway which is in as bad if not worse shape than the Brooklyn Queens Expressway.

Mayor de Blasio, Comptroller Stringer, Pension Fund Trustees Launch Next Step in Comprehensive Effort to Divest from Fossil Fuels

NYC pension funds issue RFI to solicit input from wide-range of experts in unprecedented effort

RFI follows vote by NYCERS, TRS, and BERS to begin process of divestment from fossil fuel owners

  Mayor Bill de Blasio, Comptroller Scott M. Stringer and trustees of the New York City Employees’ Retirement System (NYCERS), the Teachers Retirement System (TRS), and the Board of Education Retirement System (BERS) today announced the next significant step toward achieving a first-in-the-nation goal of divestment from fossil fuel reserve owners. Launching one of the most significant and comprehensive divestment effort in the world to date, NYCERS, TRS, and BERS, which together represent 70 percent of the total assets of the City’s $193 billion pension funds, issued a Request for Information (RFI) to gather input and recommendations from a wide range of experts to determine a prudent strategy to divest from fossil fuel owners within five years. The RFI seeks insights from a variety of fields to ensure divestment from fossil fuels is conducted in a responsible way that is fully consistent with fiduciary obligations.

“New York City is standing strong for our planet and pensioners with this next step towards divestment,” said Mayor de Blasio. “The future is about clean energy and cleaner air as we continue fighting climate change. I thank Comptroller Stringer and Trustees for their leadership as we take important steps towards divesting from fossil fuels.”

“We know that the future is with big ideas in clean energy, not with big polluters, and we believe that a green economy is a thriving economy. Today’s historic action reflects our commitment to growing our funds for pension fund beneficiaries and protecting our planet,” said New York City Comptroller Scott M. Stringer. “Mayor de Blasio has been an incredible partner as we break new ground and forge a new path in this age of climate change. I thank him for his leadership, as well as the trustees for their partnership and focus on our fiduciary obligations to ensure a healthy retirement – and a healthy earth – for the hundreds of thousands of City workers and retirees we serve.”

  

In January, NYCERS, TRS, and BERS passed a joint resolution submitted by Mayor de Blasio and Comptroller Stringer to begin analyzing ways to divest from fossil fuel owners. The RFI issued today is the first major step toward achieving the groundbreaking goal of divestment within five years in a way that fulfills the fiduciary duties of the pension funds. In order to protect the long-term interests of the Systems’ beneficiaries and determine the most effective way to safeguard the Systems from the economic and investment risks of climate change, the RFI will collect advice, information and analysis from leading experts. Insights from experts in a variety of fields will be used to develop the Request for Proposal (RFP) for services to determine the path toward unwinding investments in fossil fuel owners from the pension fund portfolio. People who have backgrounds in investment, finance, legal, scientific and environmental policy, among others fields will be engaged, with responses due on June 1, 2018.

Those who respond to the RFI may be selected to make oral presentations to the Trustees and staff to allow greater understanding and discussion of their recommendations. After the Bureau of Asset Management (BAM) and the Mayor have fully reviewed all responses from the RFI, the Bureau will begin to develop and then issue the Request for Proposal (RFP) for services to create a strategy for divesting from fossil fuel owners.

To view the RFI, click here.

Comptroller Stringer serves as the investment advisor to, and custodian and a trustee of, the New York City Pension Funds. The New York City Pension Funds are composed of the New York City Employees’ Retirement System, Teachers’ Retirement System, New York City Police Pension Fund, New York City Fire Department Pension Fund and the Board of Education Retirement System.

In addition to Comptroller Stringer, the participating New York City Pension Funds’ trustees are:

New York City Employees’ Retirement System: Mayor Bill de Blasio’s Representative, John Adler (Chair); New York City Public Advocate Letitia James; Borough Presidents: Gale Brewer (Manhattan), Melinda Katz (Queens), Eric Adams (Brooklyn), James Oddo (Staten Island), and Ruben Diaz, Jr. (Bronx); Henry Garrido , Executive Director, District Council 37, AFSCME; Tony Utano, President Transport Workers Union Local 100; Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

Teachers’ Retirement System: Mayor Bill de Blasio’s Appointee, John Adler; Chancellor’s Representative, Raymond Orlando, New York City Department of Education; and Debra Penny, Thomas Brown and David Kazansky, all of the United Federation of Teachers.

Board of Education Retirement System: Schools Chancellor Richard Carranza; Mayoral: Issac Carmignami, T. Elzora Cleveland, Vanessa Leung, Gary Linnen, Lori Podvesker, Stephanie Soto, Benjamin Shuldiner, Miguelina Zorilla-Aristy; Michael Kraft (Manhattan BP), Debra Dillingham (Queens BP), General Chacon (Bronx BP) and Peter Calandrella (Staten Island BP); and employee members John Maderich of the IUOE Local 891 and Donald Nesbit of District Council 37, Local 372.

Comptroller Stringer, NYC Pension Funds Announce $450 Million Investment in Affordable Housing

NYC’s Pension Funds launch first-of-its-kind initiative that commits millions of dollars to support affordable housing for veterans

Comptroller’s Office and NYC Pension Funds reach new milestone of 100,000+ affordable units created and preserved through funded mortgages

  Comptroller Scott M. Stringer and the New York City Pension Funds today announced a major new investment of $450 million to purchase and support non-predatory mortgages for everyday New Yorkers and support affordable housing across the five boroughs. In addition to stocks and bonds, Comptroller Stringer and the Pension Funds also invest in funds that finance affordable single-family homes as well as larger, multi-unit buildings in New York City. The investment of $450 million in pension funds will support and create tens of thousands of affordable homes and units citywide. The new investment includes a first-of-its-kind infusion of millions of dollars specifically to support veteran in New York City. Since the Comptroller’s Economically Targeted Investment program began, the Pension Funds have created or preserved over 100,000 affordable units citywide.

The $450 million will be invested through a separately managed account with RBC Global Asset Management’s Access Capital Community Investment Strategy, which invests in non-predatory, agency-backed mortgages from both private and government affordable housing programs, such as those run by a wide variety of federal, state, and city housing and economic development agencies. It includes a renewal of $300 million that had previously been invested and the addition of $150 million in new funds. The initial agreement is for three years, with the option of two three-year extensions.

By purchasing and owning these tens of thousands of mortgages, the Pension Funds are making stable long-term investments while supplying the capital needed to make more affordable housing loans. This enables and encourages public and private lenders to issue more affordable housing mortgages and promotes lower interest rates that are more favorable to consumers.

Further, the Comptroller’s Office, in partnership with RBC GAM Access Capital, has created a first-of-its-kind program to support affordable housing for veterans in New York City. Each year at least $5 million will finance mortgages guaranteed by the Department of Veterans Affairs to veterans and their families living in New York City, with the goal of 10 percent of all capital invested through RBC GAM Access Capital going to these mortgages.

“We have to work together to make New York City more affordable – and we’re taking action in innovative ways through the Pension Funds. We’re demonstrating that you can simultaneously protect the retirements of hardworking New Yorkers while mitigating one of our city’s long-term challenges. This is undoubtedly a great thing,” New York City Comptroller Scott M. Stringer said. “We’re proud to have helped create and preserve over 100,000 affordable units citywide, and even more thrilled to launch a new effort to support our veterans. Through this initiative, we’re helping everyday families, adding long-term affordable housing, and strengthening our pension funds. This is going to have positive outcomes for many, many New Yorkers.”

The Comptroller’s Office expects investing in mortgages for veterans will encourage more banks to issue VA-backed mortgages, making it easier for veterans to obtain stable housing at better rates. Approximately 210,000 veterans live in New York City.

Since 2007, investments from the pension funds in the separately managed account with RBC GAM Access Capital have totaled $397 million — resulting in 1,887 affordable single-family homes in New York City — as well as $170 million invested in multi-family buildings that delivered 33,390 affordable units across the five boroughs. Historically, the separately managed account has made nearly half of single family home investments with New York City families making less than 80% of Area Median Income (AMI)— currently $77,000 a year for a family of four— and half with moderate and middle income families.

The investment in RBC GAM Access Capital is part of the Comptroller’s Office’s Economically Targeted Investments program, which seeks investments that deliver strong returns while also creating secondary benefits, such as affordable housing and good paying jobs. The Economically Targeted Investment program was launched in 1984, and currently the City Pension Funds have invested nearly $2.5 billion with an additional $500 million in future commitments. These investments have financed 105,000 units of affordable housing.

For information on the New York City Pension Funds’ Economically Targeted Investment program, click here.

“Solving the affordable housing crisis requires innovative solutions and strong partnerships, and I commend the Comptroller for extending this important lifeline to our city’s veterans,” said New York City Department of Housing Preservation and Development (HPD) Commissioner Maria Torres-Springer. “Creating more opportunities for affordable homeownership, especially for those individuals who have sacrificed for our country, is a critical component of the Mayor’s housing plan.  We look forward to our continued collaboration as we work to improve access to homeownership across the five boroughs.”

Comptroller Stringer serves as the investment advisor to, and custodian and a trustee of, the New York City Pension Funds. The New York City Pension Funds are composed of the New York City Employees’ Retirement System, Teachers’ Retirement System, New York City Police Pension Fund, New York City Fire Department Pension Fund and the Board of Education Retirement System.

In addition to Comptroller Stringer, the New York City Pension Funds’ trustees are:

New York City Employees’ Retirement System: Mayor Bill de Blasio’s Representative, John Adler (Chair); New York City Public Advocate Letitia James; Borough Presidents: Gale Brewer (Manhattan), Melinda Katz (Queens), Eric Adams (Brooklyn), James Oddo (Staten Island), and Ruben Diaz, Jr. (Bronx); Henry Garrido , Executive Director, District Council 37, AFSCME; Tony Utano, President Transport Workers Union Local 100; Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

Teachers’ Retirement System: Mayor Bill de Blasio’s Appointee, John Adler (Chair); Raymond Orlando, representing the Chairperson of the Panel for Educational Policy and Debra Penny, Thomas Brown and David Kazansky, all of the United Federation of Teachers.

New York City Police Pension Fund: Mayor Bill de Blasio’s Representative, John Adler; New York City Finance Commissioner Jacques Jiha; New York City Police Commissioner James P. O’Neill (Chair); Patrick Lynch, Patrolmen’s Benevolent Association; Michael Palladino, Detectives Endowment Association; Edward D. Mullins, Sergeants Benevolent Association; Louis Turco, Lieutenants Benevolent Association; and, Roy T. Richter, Captains Endowment Association.

New York City Fire Department Pension Fund: Mayor Bill de Blasio’s Representative, John Adler; New York City Fire Commissioner Daniel A. Nigro (Chair); New York City Finance Commissioner Jacques Jiha;  Gerard Fitzgerald, President, LeRoy McGinnis, Vice President, Edward Brown, Treasurer, and John Kelly, Brooklyn Representative and Chair, Uniformed Firefighters Association of Greater New York; John Farina, Captains’ Rep.; Paul Mannix, Chiefs’ Rep., and Jack Kielty, Lieutenants’ Rep., Uniformed Fire Officers Association; and, Thomas Phelan, Marine Engineers Association.

Board of Education Retirement System:  Schools Chancellor Carmen Fariña; Mayoral: Isaac Carmignani, T. Elzora Cleveland, Vanessa Leung, Gary Linnen, Lori Podvesker, Stephanie Soto, Benjamin Shuldiner, Miguelina Zorrilla-Aristy; Michael Kraft (Manhattan BP), Deborah Dillingham (Queens BP), Geneal Chacon (Bronx BP), April Chapman (Brooklyn BP), and Peter Calandrella (Staten Island BP); and employee members John Maderich of the IUOE Local 891 and Donald Nesbit of District Council 37, Local 372.

Comptroller Stringer, NYC Funds: After Two Years of Advocacy, “Proxy Access” Nearly A Market Standard

Number of companies with meaningful proxy access has grown 5,266% in just two years

17 companies targeted for proxy access due to a lack of diversity have named a woman or minority director in the last two years

NYC Funds’ 2016 Post-Season Report highlights proxy access, political spending disclosure, and other governance initiatives

   More than 300 U.S. companies – including nearly half of the S&P 500 – have enacted rules which give large, long-term investors the ability to nominate directors to companies’ boards, allowing investors to ensure these boards are diverse, climate-competent, and able to create long-term value, according to the New York City Pension Funds’ 2016 Post-Season Report released today by New York City Comptroller Scott M. Stringer. The report also highlights other shareowner efforts over the last year, including work on disclosure of political spending.

“Just two years ago, we launched a nationwide campaign to change the rules of the road for director elections. We emphasized diversity, accountability, and transparency in companies – and there’s no doubt it’s resonating across the marketplace. Companies are taking action because of the work we started just a couple years ago,” New York City Comptroller Scott M. Stringer said. “Incorporating a multitude of perspectives and listening to diverse viewpoints is critical for businesses in the 21st century. It’s clear we’re moving in the right direction, but there’s more to do.”

The New York City Pension Funds’ “Post-Season Report” provides an overview of shareowner initiatives by the New York City Pension Funds in 2016.

Highlights include:

The Boardroom Accountability Project

Proxy Access is the ability of large, long-term investors to nominate board directors on a company’s ballot. In 2010, the SEC enacted a universal proxy access rule, which was subsequently challenged in court and overturned on technical grounds. In response, Comptroller Stringer and the New York City Pension Funds launched the Boardroom Accountability Project in 2014 to bring this right to the U.S. market, company by company. Firms were targeted if they had little or no board diversity, excessive CEO pay, or substantial exposure to risks related to climate change, such as a reliance on carbon-intensive business practices.

• In 2014, only six U.S. companies had meaningful proxy access. Today, more than 322 companies do – an increase of 5,226 percent.
• Ninety-six companies targeted by the New York City Pension Funds have enacted proxy access – roughly 30 percent of those that have proxy access today. Seeing the changing landscape, hundreds of other companies have implemented proxy access on their own or in response to engagement from other investors.
• In 2015, when the New York City Pension Funds filed proxy access proposals with 75 companies, just eight percent of them agreed to implement the proposal before a shareowner vote. In 2016, 72 percent of 72 target companies enacted proxy access before votes were cast.
• The 18 proposals that did go to a vote in 2016 received an average 58 percent support. Thirteen of them received majority support.
• At least 17 companies that were targeted for inadequate board diversity over the last two years – including AbbVie, Cabot Oil & Gas, Ebay, Fidelity National Financial, Priceline, and Union Pacific – have added at least one female and/or minority director.

Political Spending Disclosure

Over the last year, the New York City Pension Funds and Comptroller Stringer have encouraged numerous energy companies to increase transparency around political spending and enact policies that give their boards of directors oversight over this practice. These moves enable investors to determine whether corporate political spending actually aligns with the long-term interests of the company and investors.

• In response to a first-time proposal, Eversource Energy adopted a policy that ensures board oversight and disclosure of political spending. The proposal was withdrawn.
• Three companies – Consolidated Edison, PNM Resources, and PPL Corporation – agreed to enhance their public disclosures before proposals were filed.
• Two additional companies, Cabot Oil & Gas and DTE Energy, agreed to improve their disclosures after strong votes from investors on the pension funds’ proposals.

The 2016 Post-Season Report also includes information on a number of other initiatives, including efforts to enhance disclosure of workplace diversity data at Capital One, claw back incentive pay from executives at Wells Fargo, institute governance reforms at Mylan, and encourage ExxonMobil to release information on climate change risks.

To read a full copy of the report, click here.

Comptroller Stringer serves as the investment advisor to, and custodian and a trustee of, the New York City Pension Funds. The New York City Pension Funds are composed of the New York City Employees’ Retirement System, Teachers’ Retirement System, New York City Police Pension Fund, New York City Fire Department Pension Fund and the Board of Education Retirement System.

In addition to Comptroller Stringer, the New York City Pension Funds’ trustees are:

New York City Employees’ Retirement System: Mayor Bill de Blasio’s Representative, John Adler (Chair); New York City Public Advocate Letitia James; Borough Presidents: Gale Brewer (Manhattan), Melinda Katz (Queens), Eric Adams (Brooklyn), James Oddo (Staten Island), and Ruben Diaz, Jr. (Bronx); Henry Garrido , Executive Director, District Council 37, AFSCME; John Samuelsen, President Transport Workers Union Local 100; Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

Teachers’ Retirement System: Mayor Bill de Blasio’s Appointee, John Adler; Chancellor’s Representative, Raymond Orlando, New York City Department of Education; and Debra Penny, Thomas Brown and David Kazansky, all of the United Federation of Teachers.

New York City Police Pension Fund: Mayor Bill de Blasio’s Representative, John Adler; New York City Finance Commissioner Jacques Jiha; New York City Police Commissioner James P. O’Neill (Chair); Patrick Lynch, Patrolmen’s Benevolent Association; Michael Palladino, Detectives Endowment Association; Edward D. Mullins, Sergeants Benevolent Association; Louis Turco, Lieutenants Benevolent Association; and, Roy T. Richter, Captains Endowment Association.

New York City Fire Department Pension Fund: Mayor Bill de Blasio’s Representative, John Adler; New York City Fire Commissioner Daniel A. Nigro (Chair); New York City Finance Commissioner Jacques Jiha; James Slevin, President, Gerard Fitzgerald, Vice President, Edward Brown, Treasurer, and John Kelly, Brooklyn Representative and Chair, Uniformed Firefighters Association of Greater New York; John Farina, Captains’ Rep.; Paul Ferro, Chiefs’ Rep., and Jack Kielty, Lieutenants’ Rep., Uniformed Fire Officers Association; and, Thomas Phelan, Marine Engineers Association.

Board of Education Retirement System:  Schools Chancellor Carmen Fariña; Mayoral: Issac Carmignami, T. Elzora Cleveland, Vanessa Leung, Gary Linnen, Lori Podvesker, Stephanie Soto, Benjamin Shuldiner, Miguelina Zorilla-Aristy; Michael Kraft (Manhattan BP), Debra Dillingham (Queens BP), Geneal Chacon (Bronx BP) and Peter Calandrella (Staten Island BP); and employee members John Maderich of the IUOE Local 891 and Donald Nesbit of District Council 37, Local 372.