According to a 1994 Urban Institute study commissioned by the National Cooperative Bank, the cooperative housing created under these programs offered substantial public benefits in the form of both long-term retention of affordable housing stock and superior financial performance. At this level of income, renters in Housing Credit properties would almost certainly never have the opportunity to own a home . NCB has financed over 30,000 units of affordable housing in the United States over the past fifteen years with delinquency ratios below national averages and nominal charge offs in recent years. Under Section 42 in its current form, a few developers have utilized a somewhat cumbersome leasing cooperative structure in the hope that it would provide a taste of ownership to low income residents. While the intent is commendable, the residents have only the distant promise that, at some remote future date, they might, through an option to purchase, gain actual ownership.
Experience indicates that resident's derive no sense of ownership from that uncertain possibility.
This proposal does not increase the Housing Credit but simply allows a cooperative structure. Our legislative proposal is anticipated to have little or no revenue impact , because the cooperative structure will be equal to a rental. Senator D'Amato submitted the proposed legislation to the Joint Committee on Taxation for a revenue impact estimate, and we are awaiting the results. In addition, the resident's initial limited equity contribution could appreciate modestly over the term of their residency. This could result in as many as 15,000 renters within five years moving into units they would own.