NYC Settles Housing Lottery Lawsuit, Lowers Community Threshold

New York City has settled a legal dispute over its long-standing practice of setting aside 50% of the affordable apartments offered in city-run housing lotteries for neighborhood residents.

In a settlement ending a lawsuit that was filed in 2015, NYC has agreed to lower the 50% threshold for reserved affordable units to 20% until May 1, 2029, when the threshold will drop to 15%.

Any housing project that goes to market within the next three months will be grandfathered in under the old standard.

In 2015, Craig Gurian, an attorney who is the executive director of a group known as the Anti-Discrimination Center, filed a lawsuit on behalf of two Black New Yorkers who were unable to get housing in city-run lotteries outside of their community districts.

The city’s policy, which was known as community preference, reserved 50% of the units for residents of the local community district.

The lawsuit alleged that community preference violates the federal Fair Housing Act because it perpetuated segregated district demographics by lowering the chance that residents could move to new neighborhoods.

Prof. Andrew Beveridge, a sociology professor at Queen College with expertise in demographics, specifically the application of GIS technology to the analysis of social patterns, testified for the plaintiffs that the “community preference policy imposes a sorting process that would not otherwise exist and does so in a pattern that causes material disparities by race and ethnicity.”

“The result of the operation of the community preference policy is a pattern that perpetuates segregation more (and allows integration less) than would exist without the policy,” Beveridge said.

According to the settlement, NYC has agreed to pay each of the plaintiffs, Shauna Noel and Emmanuella Senat, $100,000; the city also will pay $6M covering the plaintiffs’ attorneys’ fees.

Mayor Eric Adams has made the creation of more affordable housing in every city neighborhood a centerpiece of his “Moonshot” plan to create 500,000 new housing units by the end of the decade.

In a statement, the mayor characterized the settlement as a win-win that will enable to city to continue the practice of community preference, albeit with lower thresholds.

“This agreement, which allows the city to maintain the community preference policy, preserves a critical tool that lets us build on this progress and continue creating new affordable in partnership with communities across the city,” Adams said.

Gurian called the settlement a victory for fair housing. “City officials have turned away from the discredited politics of racial turf and said out loud, in words, that all of our neighborhoods need to belong to all of us,” Gurian said, in a statement.