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How Many Rent-Regulated Units Are Rented at Preferential Rates and Where Are They Located?

It is commonly assumed that rent regulation limits the amount owners can charge tenants, keeping rents below what the market would otherwise command. Yet for thousands of apartments across the city, landlords charge their tenants rents that are lower than the maximum allowed under rent-regulation rules. This is known as a preferential rent. While landlords will sometimes forgo additional permissible rent to retain a reliable tenant, in neighborhoods where there are large shares of tenants paying preferential rents, it is an indication that local market rents are not constrained by rent regulations.

Using apartment registration data from the New York State Division of Housing and Community Renewal, IBO found that of the 765,354 state-registered units subject to the traditional rent-regulation rules in 2013 (the most recent data available), 23 percent—more than 175,000 apartments—were rented at a preferential rate.

Share of Regulated Units Rented at Preferential Rates

Click on a neighborhood to see number of rent-regulated apartments and share with preferential rents.

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  • Neighborhoods with some of the highest shares of tenants in regulated units paying preferential rates were Oakwood in Staten Island (62 percent), and Fresh Meadows and Bay Terrace in Queens (61 percent and 60 percent, respectively). The overall number of regulated units in these areas, however, was small.
  • In neighborhoods with large numbers of regulated units, those with high shares of units receiving preferential rents include Flushing (38 percent), Astoria (35 percent), and Hunters Point-Sunnyside (34 percent).
  • Some of the neighborhoods with substantial numbers of regulated units and the lowest shares of apartments with preferential rents include the West Village (10 percent) and the Upper West Side (10 percent). Outside of Manhattan, Borough Park (15 percent) and Prospect-Lefferts Gardens (17 percent) in Brooklyn had low shares of preferential rents.

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  • The prevalence and extent of the rent preference varies among the boroughs. Brooklyn had the largest number of regulated units receiving preferential rents, followed by Queens.
  • In terms of the median preferential rent discount—the difference between what the tenant pays and the maximum legal rent the landlord could charge under rent regulation—apartments in Manhattan had the largest median discount, while units in Brooklyn had the smallest.

The fact that in some parts of the city more than a quarter of units receive preferential rents indicates that rent regulation is not always the most important factor in determining a tenant’s rent. Barring substantial increases in market rents in the neighborhoods with large shares of regulated units with preferential rates, continued regulation might not make much difference in determining the cost of housing for tenants in those areas.

 Prepared by Sarah Stefanski

New York City Independent Budget Office

SOURCE: IBO analysis of data from the New York State Division of Housing and Community Renewal
NOTES: A total of 862,254 regulated units were registered with the New York State Division of Housing and Community Renewal in 2013, approximately 84 percent of the total estimated number of rent-regulated units in the city. A total of 96,900 units added into rent regulation after 1974 in exchange for certain financing benefits, such as the 421-a and 421-g tax incentive programs, were excluded from this analysis.

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New York City By The Numbers

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How Much Do Public School Budgets Vary Across the City’s School Districts and Boroughs?

There is a great deal of variation in average per pupil allocations across community school districts. In 2013-2014, the last school year in which budgets were set by the Bloomberg Administration, school district allocations averaged $8,255 per student in grades pre-k through 8. The difference in per pupil allocations between the district with the highest average allocation (district 16, Bedford-Stuyvesant) and the lowest (district 24, Corona/Elmhurst) was $3,800.

This variation is not unexpected. Schools recieve funding from a variety of state, city, and federal sources, many of these funding streams attempt to direct resources to students deemed to have greater needs. Moreover, per pupil spending is also a function of school size, with large schools generally receiving less funding per pupil than schools with fewer students.

  • Some part of the difference in allocations relates to the relative socio-economic status of the communities within each district.
  • The largest per pupil allocations are found in the South Bronx (district 7), Central Brooklyn (district 16), Upper Manhattan (districts 4 and 5), and the Lower East Side (district 1). The lowest per student allocations are found in Queens (districts 24, 25, and 26) and Manhattan (district 2).

The results displayed by borough and funding source shed more light on these differences.

  • The three largest funding streams for schools, Fair Student Funding, other city funds, and Federal Title 1, drive the major difference across boroughs. Schools in Queens receive, on average, $1,310 less per pupil from these combined sources than schools in the Bronx.

School size also contributes to the differences in per pupil allocations across districts and boroughs. Generally, large schools receive less funding in per pupil terms than small schools. This is likely because schoolwide costs are being shared over a greater number of students. Queens, with the largest average school size, had the lowest per pupil allocations, while Manhattan and the Bronx, with the two smallest average school sizes, had the two largest per pupil allocations.

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 Prepared by Ray Domanico

New York City Independent Budget Office

SOURCE: IBO analysis of Department of Education data
NOTES: Excludes high schools and schools in the citywide special education district (district 75) because they are not evenly distributed across community school districts. Spending allocated to school budgets exclude fringe benefits.

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New York City By The Numbers

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Has the Distribution of Cultural Development Funds Shifted Over Seven Years?

In 2009, the city’s Department of Cultural Affairs concluded a multiyear initiative to reform the Cultural Development Fund, the primary source of city funding for hundreds of arts and cultural organizations throughout the five boroughs. (The 33 cultural institutions located on city-owned property receive other support and are ineligible for these grants.) From fiscal years 2009 through 2015, the city has awarded a total of $210.5 million in Cultural Development Fund  grants. An average of 886 organizations per year received funding.

  • Total annual Cultural Development Fund grants (including City Council member items and Borough Arts Council grants) have increased from $29.0 million in fiscal year 2009 to $33.2 million in 2015. There is $33.5 million budgeted for the fund in 2016. Average funding per organization increased from $32,858 in 2009 to $37,340 in 2015.
  • Groups based in Manhattan receive by far the most funding, with awards totaling just under $20 million in 2015; organizations in Brooklyn, the borough with the second-highest share, received $6.5 million in funding that same year.
  • Manhattan’s share of total funding has decreased somewhat, from 63.7 percent in 2009 to 60.1 percent in 2015, while Brooklyn’s share has increased from 15.7 percent to 19.5 percent over the same time span. Shares for the other three boroughs changed very little.
  • Average funding per organization in 2015 ranged from $29,079 in Staten Island to $59,224 in the Bronx.

Organizations receiving grants can focus on single disciplines such as folk art, dance, or literature or be multidisciplinary. Multidiscipline organizations have received the highest percentage of total funding, over one-quarter of all funding each year. There has been little change in the distribution of funding across all disciplines since the revamping of the cultural fund in 2009.

NOTES: *Chart excludes funding for Borough Arts Councils because many of them do not categorize recipient groups’ disciplines. **Combines Botanical, Crafts, New Media, Photography, Science, and Other categories. ***Combines three different multidiscipline categories.

  • Music has seen the biggest decrease in its share of funding over the past seven years, a drop of 2.9 percentage points from 17.0 percent of total funding in 2009 to 14.1 percent in 2015.
  • Visual arts has seen the biggest increase in its share of funding over the same time period, from 4.5 percent in 2009 to 6.4 percent in 2015.

 Prepared by Katie Hanna

New York City Independent Budget Office

SOURCE: Department of Cultural Affairs

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New York City By The Numbers

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Does City Spending on Antismoking Efforts Affect Smoking Rates?

A recently released American Cancer Society annual report says that based on federal Centers for Disease Control and Prevention guidelines New York State failed to invest sufficient funds last fiscal year on antismoking efforts. IBO’s review of New York City’s own spending on antismoking programs finds that spending levels have varied widely in recent years—and that after trending downward the local adult smoking rate has been increasing.

In 2002, the city’s Department of Health and Mental Hygiene launched its tobacco control plan for reducing smoking among city residents. The plan included: hiking taxes on tobacco products; distributing cessation aids for current smokers; advocating for and enforcing antismoking legislation; and running public education campaigns on the consequences of tobacco use. Spending rose steeply in 2007, with the increase driven by advertising, media campaigns, and nicotine replacement therapies, rather than agency staffing. Tobacco control spending jumped again in 2008—reaching more than 10 times the 2001 level—even as spending on agency staff barely grew. A three-year decline in spending followed in 2009 through 2011, with all of the cuts coming from sources other than health department staff.

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  • The impact of the tobacco control plan on smoking behaviors occurs with a lag because of the time it takes individuals to  cut back or quit—and particularly for spending programs, the time it takes to launch new initiatives.
  • In calendar year 2002, the city and state each hiked their excise taxes on cigarettes to $1.50, for a total of $3.00 per pack. With additional state increases in 2008 and 2010, the combined state and local tax is now $5.85 per pack, plus an additional $1.01 per pack federal tax.
  • The big increase in city spending on antismoking programs, along with the tax increases, have been credited with reducing the smoking rate in the city during a period when the U.S. smoking rate barely declined. In 2010, the city’s smoking rate fell to 14.0 percent, a 15-year low and 5.3 percentage points below the U.S. rate.
  • After 2010, smoking rates in the city began to rise, reaching 16.1 percent in 2013 (the latest data available), just 1.7 percentage points below the U.S. rate. The increase in the city’s smoking rate occurred in tandem with declines in spending on tobacco control programs. City spending on antismoking campaigns in 2011-2014 averaged about a third less than during the 2007-2010 peak spending period.
  • Health department officials have cited the decline in spending on tobacco control as a cause of the increase in the share of adults who smoke. With $5.0 million budgeted for tobacco control in the current fiscal year, less than half the amount spent in 2014, there is concern that the smoking rate could continue to rise.

Prepared by Erin Kelly
New York City Independent Budget Office

SOURCES: Department of Health and Mental Hygiene, Community Health Survey 2002-2013; Centers for Disease Control and Prevention, National Health Interview Survey, 2013

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New York City By The Numbers

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Do a Larger Share of Students Attending the City’s Specialized High Schools Live in Neighborhoods With Higher Median Incomes than Those Attending the City’s Other High Schools?

The city’s Department of Education runs nine specialized high schools that are among the most selective of the city’s public high schools. Eight schools admit students based solely on the score attained on the Specialized High Schools Admissions Test and admission to LaGuardia High School is based on an audition. All 8th graders and first-time 9th graders who are New York City residents are eligible to take the test. The score required for acceptance depends on the school and varies each year.

IBO used the address of each student attending a New York City public high school in the 2012-2013 school year to identify the census tract in which each student lived and the median household income for households residing in the tract. We then compared the median incomes of the neighborhoods where students lived who were attending the specialized high schools with those of students attending all other public high schools.

  • Students in the specialized high schools came from census tracts where the median household income averaged $62,457 compared with $46,392 for students in other high schools. (All dollar amounts are reported in 2012 dollars).
  • If we rank the census tracts by their median income and then divide the tracts into equal fifths (quintiles), we observe large differences between the share of students in specialized high schools and other high schools from each quintile.


 

  • Only 11 percent of specialized high school students came from the lowest income census tracts (those where the median household income is less than or equal to $33,862) whereas 30 percent of students in other high schools came from these neighborhoods.
  • Twenty-six percent of specialized high school students reside in the top income quintile (the 22 percent of census tracts with median incomes over $81,650) compared with just 7 percent of those attending other high schools
  • Overall, the share of students attending specialized high schools increases steadily and then drops marginally in the two highest quintiles, as we move from the census tracts with lower median household incomes to the census tracts with higher median incomes. For students attending other Department of Education high schools, the pattern is the opposite: the share of students declines as median income increases.

 

Prepared by Stephanie Kranes
New York City Independent Budget Office

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New York City By The Numbers

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Is the City Spending at Least 1 Percent of Its Federal Title 1-A Funds on Parental Involvement?

Federal Title I-A funds provide assistance to schools and local educational agencies (in New York City, the Department of Education) that serve a large number or share of students from low-income families. Under federal rules, school systems that receive at least $500,000 in Title I-A funds must use at least 1 percent of their annual allocation for activities that promote parental involvement. Title 1-A requires parental input into determining the activities provided as well as their implementation. Although schools also use additional sources to fund parental involvement, only Title 1-A requires that parents be involved in planning for the use of these funds.

  • In school year 2013-2014, 1,292 schools (nearly 79 percent) of the city’s public schools received Title 1-A funds.
  • Schools receiving Title I-A funds collectively spent $11.2 million on parental involvement activities in 2013-2014—more than double the required minimum expenditure of $5.2 million for the Department of Education.

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  • The education department gives schools a targeted amount of 1 percent of their Title 1-A funds to spend on parental involvement in the department’s school budget allocations.
  • In school year 2013-2014, 10 percent of Title 1-A schools with parental involvement spending targets self-reported spending below the amount targeted and nearly 71 percent reported spending more than their assigned target amount.

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  • Nearly 70 percent of schools receiving Title I-A funds were targeted to spend between $1,000 and $5,000 for parental involvement.
  • For schools spending in this range, the expected expenditure equaled about 0.1-0.2 percent of an average school budget.
  • Lack of standardized reporting limits analysis by type of expenditure.

Prepared by Liza Pappas & Yolanda Smith
New York City Independent Budget Office

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New York City By The Numbers

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The Public Assistance Caseload: More Job Training, Fewer Punitive Actions Under the de Blasio Administration?

In October 2014, the city’s Human Resources Administration announced a new employment plan for public assistance recipients. The plan, which was already being phased in before the formal announcement, makes the agency’s employment programs less punitive and puts more emphasis on education and training. Some of the changes can already be seen by comparing participation data from December 2013 with December 2014.

  • The number cash assistance cases under or facing sanctions for violating the employment requirements fell from 19,632 (19.6 percent of all cases) to 14,473 (13.6 percent).
  • Cases with the household head in an education, training ,or job search program increased from 3,347 (3.3 percent) to 5,485 (5.1 percent).
  • The number of cases classified as temporarily unengageable jumped from 9,119 (9.1 percent) to 19,823 (18.6 percent), primarily due to a big increase in the number of cases being evaluated for WeCARE, a program designed to help clients overcome medical and/or mental health barriers to employment.
  • The number participants in the long controversial Work Experience Program, which requires participants to work for their cash and food stamp benefits, also decreased somewhat from 10,661 (10.6 percent) to 9,786 (9.2 percent). The plan calls for gradually phasing out this program.

Prepared by Paul Lopatto
New York City Independent Budget Office

SOURCE: Human Resources Administration, Weekly Caseload Engagement Status Reports for January 5, 2014 and January 4, 2015
NOTES: The numbers exclude cases categorized as indefinitely unengageable including child only cases, and those in which the household head is receiving Supplemental Security Income, is age 60 or over, or is receiving services from the HIV/AIDS Services Administration. They also exclude a small number of cases categorized as unengaged. Cases are classified by their primary activity.

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New York City By The Numbers

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How Much Would the City’s Annual Contribution Be Today If Aid for the Metropolitan Transportation Authority’s Capital Projects Had Kept Pace with Inflation?

The city makes an annual payment to the Metropolitan Transportation Authority (MTA) to support the authority’s capital program. NYPIRG’s Straphangers Campaign asked IBO to review the annual contributions to see if they have kept pace with inflation.

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• The city’s contribution to the MTA’s first five-year capital plan (1982-1986) averaged $136 million a year. In nominal terms, the city’s contribution was highest during the 1987-1991 and 1992-1999 plans and has remained fairly constant at around $100 million per year since 2000.
• If the city had instead decided to keep its contribution at the 1982-1986 level in real (inflation-adjusted) terms, the contribution would have reached $363 million in 2014, and provide more than $1.8 billion for the proposed 2015-2019 capital plan.

• The city’s contribution to the MTA’s 1982-1986 capital plan averaged 1.2 percent of total city-funded expenses over the five-year period. Over time the city’s contribution as a share of total city-funded expenses has declined dramatically. The city’s contribution to the MTA capital plan in 2010-2014 averaged just 0.2 percent of total city-funded expenses a year.

New York City and state also provide indirect support to the capital program through dedicated tax revenue—in most cases, revenues predominately collected in the 12-county MTA region—that flow into the MTA’s operating budget. These revenues, which have grown substantially over the past three decades, are used to pay debt service on MTA bonds that finance capital projects as well as the operating expenses of the transit system. IBO estimates that New York City residents alone generated around $3.1 billion in city and state tax revenue for the MTA in 2014, compared with just $235 million in 1983.

Prepared by Alan Treffeisen
New York City Independent Budget Office

SOURCES: IBO analysis of data from the Metropolitan Transportation Authority, Moody’s Analytics, and the New York City Comptroller’s Office
NOTES: Inflation measured by the local government GDP deflator for the New York City metropolitan region. IBO compares the city’s contribution to the MTA on a calendar year basis to the city’s fiscal year expenditures.

 

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New York City By The Numbers

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How Many Students Can Enter a Gifted & Talented Program in New York City?

In the 2013-2014 school year, approximately 36,000 students took the test to determine their eligibility for a seat in a New York City public school Gifted & Talented program for the 2014-2015 school year. The test is grade-specific and any student entering grades K through 3 can potentially take it.

The Department of Education defines the criteria for acceptance to a Gifted & Talented, or G&T, program. Students must take two tests measuring their verbal and nonverbal skills. The scores of these tests are combined to find a single rank for the student based on their age and national norms. Students can apply to a district-level G&T program if they rank above the 90th percentile, and they can apply to any of the five citywide G&T programs if they rank above the 97th percentile. Students receive offers based on their ranked scores and their school preferences.

  • Roughly 5,400 incoming kindergarteners who took the G&T test in school year 2013-2014 (about 40 percent of the test-takers) surpassed the 90th percentile, making them eligible to apply for a G&T program—1,500 of them achieved the highest score.
  • But the school system had G&T program seats for less than half of the qualifying kindergarteners, only a total of 2,200 seats were available across the city. This included 273 seats in the five most selective citywide programs.
  • This gap between the number of students meeting the official criteria and the spots available has meant that in recent years most of the G&T programs can only accommodate students ranking closest to the 99th percentile.

Prepared by Diana Zamora Bonnet
New York City Independent Budget Office

SOURCE: Department of Education

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New York City By The Numbers

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