City Plans Up to $100M Insurance Program for Affordable Buildings

The city plans to commit up to $100 million over three years to launch a program meant to lower property and liability insurance costs for income-restricted and rent-stabilized buildings. The Economic Development Corporation is now hiring outside lawyers to set it up, with proposals due Nov. 16.

The request for proposals was published in a city notice on Oct. 23 and made available the same day.

The money and the ground rules

EDC describes the $100 million as a one-time infusion to launch and sustain the program, which is expected to run indefinitely as part of the city’s affordable housing system.

The conditions are ambitious. The program must deliver policy results, stay solvent and self-sustaining, and at minimum preserve the city’s money, with a preference for structures that earn a return.

Cheaper insurance for landlords, no loss to taxpayers, and ideally a profit. Lawyers will be paid to figure out how.

Who it is for

The target buildings largely already have legal or contractual ties to the Department of Housing Preservation and Development and the Housing Development Corporation.

As lenders and regulators, the notice says, those agencies monitor the buildings’ finances and condition and regularly engage owners on operational issues, including insurance coverage.

What the lawyers would do

Outside counsel would advise and represent EDC, and agencies on request, on tax, insurance, corporate governance and public finance matters. That includes structuring the program, investing the capital and governing it over time.

EDC says it will weigh proposal quality, staff and subcontractor experience, similar past work and fees. The contract carries M/WBE participation goals.

What the notice does not say

The notice does not say how the program would cut premiums, how many buildings could take part, or what the legal contract itself is expected to cost.

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