Empty in the Middle

Owners Opt Out of Mitchell-Lama for Market Rents

Indeed, Mitchell-Lama apartments have long been a plum to hand out to the politically powerful or socially significant. A 1988 Newsday investigation found an array of highly paid, well-connected tenants, including one Mario Cuomo campaign attorney and a former housing authority member, living in oversized apartments in the Cooper Gramercy, for instance. Abuse, of course, is not limited to tenants. Earlier this year, the federal housing agency blocked a 24 percent rent increase for a Brooklyn Mitchell-Lama development after learning of irregularities by its owner, Herman Kraus. (Mitchell-Lama rent increases must be approved by city or state agencies, and the program's goal was to raise rents only so that landlords could realize a 6 percent return.)

"Generally, it's a well-run program, but are there problems? Hell, yes," says Bob Willos, cochair of the Mitchell-Lama Residents Coalition. "Of course there are people living in these buildings who shouldn't be; people who are too wealthy, or squatters, or someone's brother-in-law. Yeah, there's been corruption. But it's probably the best middle-income housing program in the United States because enough of it is doing what it's supposed to do."

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