NYC Housing Overseer Let Towers Misspend $163,862, Stay Unsafe

New York's state comptroller⧉ found that the New York City Department of Housing Preservation and Development (HPD) -- the agency that oversees the city's Mitchell-Lama affordable-housing program -- let three developments spend $163,862 on bonuses, gratuities, and undocumented expenses from January 2019 through December 2024, while self-closing fire doors failed to latch, mold spread through occupied apartments, and mice got into a day care's classroom at one of the towers.

Mitchell-Lama is a 1955 New York State program that trades low-interest mortgages and tax breaks for income-restricted rents; HPD, described in the audit as "the nation's largest municipal housing preservation and development agency,"⧉ supervises 92 of these developments citywide -- about 46,787 apartments.▸ Owners hire private "managing agents" to run each building day to day, and HPD's job is to confirm those agents keep the buildings safe and spend development funds only on development business. The comptroller sampled three: Clinton Towers in Manhattan (397 units), Evergreen Gardens in the Bronx (358 units), and Tivoli Towers in Brooklyn (321 units) -- 1,076 apartments in all, run by three different management companies.

Under New York City's Administrative Code⧉, a self-closing fire door that fails to latch is a class C "immediately hazardous" violation, and the owner has 14 days from notice to fix it.▸ Auditors found exactly that failure at all three towers -- broken doorknobs and missing lock components keeping stairwell fire doors from closing -- plus crumbling facades, holes in a building foundation, and units with mold and water damage; taken together, that whole category of hazardous conditions is required to be corrected within 21 days or less. At Evergreen, 22 of 35 sampled units had hazardous conditions; at Tivoli, 10 of 32. At Clinton, a day care leasing commercial space reported an ongoing mice infestation, and auditors photographed droppings on the classroom floor, in a book closet, and on traps placed under radiators while children were present. None of the three developments gave HPD or the auditors the annual individual-unit inspection reports the program's rules require -- meaning HPD had no paper trail showing it knew what state these apartments were actually in.

The $163,862 breaks down as non-mandated bonuses and holiday gratuities to maintenance staff, porters, and superintendents ($39,449 at Clinton, $53,793 combined at Tivoli), plus expenses auditors couldn't match to any invoice or canceled check.▸ Clinton's tab included $932 spent on "food and drink" for its board of directors -- while the development ran a net loss before depreciation in each of the three years auditors checked and carried about $4.1 million in unpaid bills as of June 2025. A separate, earlier HPD audit had already told Clinton's superintendent to stop using a personal credit card for building purchases; this audit found $9,551 in reimbursements still going to him for personal-card charges through June 2024.

HPD's own rules impose two separate checks on big contracts: bids and services worth $100,000 or more need competitive bidding and written city sign-off, and any vendor whose payments reach $100,000 in a year has to be reported to HPD, even under an existing contract.▸ Auditors couldn't find bidding or approval documentation for $4.6 million in contracts across the three developments -- including an $811,350 boiler-service contract at Evergreen -- and separately found that all three developments had paid a vendor over the $100,000 notification threshold without ever telling HPD, including a $579,810 repair contract at Clinton, $180,561 for fencing at Evergreen, and $161,631 for building supplies at Tivoli. Meanwhile, the buildings were also losing money on the other end: vacant units at Clinton and Tivoli cost $327,514 in rent no one collected, and the three developments together were owed nearly $4 million in tenant arrears, most of it more than 90 days overdue.

HPD's Acting Commissioner, in a written response included in the audit, said the agency agreed with most of the recommendations -- many already underway -- and that the report gave incomplete credit for preservation financing at Tivoli specifically: an approximately $55 million refinancing that closed in June 2022 and roughly $13 million in supplemental City capital subsidy that closed in September 2024, both funding facade, roof, elevator, and plumbing work HPD says mostly predated or overlapped the audit fieldwork.▸ The comptroller's office said it reviewed and considered that explanation before finalizing its findings. The audit gives HPD 180 days from its release to report back on what it did with the recommendations -- a deadline that fell in mid-July 2026.