The city has reached a $2 billion settlement with federal investigators to repair deplorable conditions at the city's public housing apartments.

The investigation has been going on for years.


The amount agreed upon is in addition to what the city is already spending on New York City Housing Authority (NYCHA) housing.

The first billion will be paid out over the first four years, with the remaining billion paid in the years that follow.

"This is not just a short-term solution that kicks the can down the road. After the first four years, the city has committed to providing $336 million per year in capital funding through 2027," United States Attorney for the Southern District of New York Geoffrey Berman said Monday. "Today marks the beginning of the end of this nightmare for NYCHA residents."



The Department of Housing and Urban Development will contribute $300 million per year for four years, and the state has pledged $550 million for repairs and improvements.


The deal also calls for the appointment of a monitor to indefinitely oversee the housing authority.



Gov. Andrew Cuomo originally appointed a state monitor that was also expected to oversee NYCHA, but that monitor has been rescinded, giving deference to the federal monitor.

But it may be quite some time before the federal monitor is appointed, as it has to go through the judicial process.


The accusations stemmed from an investigation that found widespread mismanagement at NYCHA, which has received thousands of complaints each year about broken elevators, insufficient heat, mold, and infestations of rats and cockroaches.


The payment will settle claims that NYCHA used dirty tricks like building fake walls to hide problems from inspectors and lied about lead paint conditions to mask risks to low-income residents and their children, federal prosecutors said.

The agency "engaged in a culture of false statements and concealment" when filing reports required to secure federal housing subsidies, Berman said. "The culture of NYCHA is to blame. The management of NYCHA is to blame."

The U.S. Attorney's Office called it a cover-up culture, one that since 2010 or 2011 failed to provide safety.

Mayor Bill de Blasio called the settlement a "dramatic step" and a "turning point for our public housing system."

The settlement came in response to a civil complaint that zeroed in on what it portrayed as the agency's indifference to the risk of lead paint poisoning children, saying, it "knows that there is lead paint within apartment units in roughly thirty percent of its developments, but has failed — and continues to fail — to protect its residents from that paint when it peels and crumbles." Between 2010 and 2016, there were 19 confirmed cases of lead poisoning of children exposed to paint in public housing apartments, with hundreds more testing above safe levels for lead, it said.



Former agency officials from Brooklyn and the Bronx told authorities that workers would shut off an entire building's water supply just before inspections to keep them from finding leaks, the complaint said.

Other times, signs reading "Danger: Do Not Enter" were posted on basement doors to keep inspectors from discovering dangerous or unsanitary conditions, it said. A former maintenance worker reported that NYCHA staff also would build false walls out of plywood just to conceal other dilapidated conditions, it added.

The problems were the result of "management dysfunction and organizational failure, including a culture where spin is often rewarded and accountability often does not exist," the compliant said.



The Justice Department is not pressing charges, though it reserves the right in the future.

The housing agency's annual operating budget is $2.3 billion for public housing where nearly 400,000 low- and moderate-income residents live. Tenants pay an average of $522 a month in rent, with the U.S. Department of Housing and Urban Development subsidizing the rest.

In April, NYCHA Chairwoman Shola Olatoye stepped down amid increasing public scrutiny of her tenure over the lead paint and heat issues.

Berman noted that NYCHA has new top management.

"We're hopeful with the federal monitor and the funds available that they're going to be able to right the ship," Berman said.


In a press conference responding to Berman's press conference on the settlement, de Blasio called NYCHA's dilapidated conditions a long-standing issue that has been a problem in previous administrations as well.

The mayor said allegations of NYCHA lying and trying to cover up the conditions will be investigated, but the mayor wouldn't let the deputy mayor overseeing NYCHA explain what she knows:

"We are not here to rehash each and every step of the past," de Blasio said.


De Blasio also said the federal monitor may ultimately usher in more federal money for the city's public housing agency. He said his hand-picked team will remain in charge, however.

The mayor apologized to the 400,000 New Yorkers living in NYCHA properties — although that apology came with a caveat.

"I want to offer a joint apology — and you can find out if the other people involved want to be a part of it," de Blasio said. "I think the federal government owes them an apology. Recent administrations going back 30 years owe them an apology. I think the state government owes them an apology, also going back decades. I think the city government owes the apology. My administration and I will offer an apology, but the administrations before me should offer an apology too."

City Hall said it is investigating who lied, but the mayor wouldn't let the deputy mayor overseeing NYCHA explain what she knows:

"We are not here to rehash each and every step of the past," de Blasio said.

The mayor said the issues at NYCHA reflect problems in the culture of problems of employees there, as well as a lack of federal funding.

Berman disagreed. "These problems exist, these conditions exist not because of any loss in federal funding, but because NYCHA was a dysfunction operation and is fundamentally flawed and engaged in a culture of false statements and concealment," he said. "That's recognized today. Even the city and NYCHA itself recognize its own failings because they agreed to the appointment of a federal monitor with broad powers."

Trump administration officials say the city should turn to private funding.

De Blasio said NYCHA may not need more private sector funds; he said more taxpayer money may start flowing from Washington to the city if Democrats regain more control of the federal government.

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