Tenants’ rights advocates seeking to build protections for residents at city-subsidized, but privately operated “three-quarter” houses, were backed by several City Council members, but corresponding legislation also met some resistance from the de Blasio administration during an Oct. 6 Council hearing. City officials cited progress relocating roughly 5 percent of tenants in the three-quarter houses, but acknowledged challenges with identifying the unregulated units.

The boarding houses, named for their position between halfway houses and standard homes, shelter people who may be returning to the community from prison, rehabilitation programs or homeless shelters. Though the houses are indirectly subsidized with tenants’ public assistance money, they are run by private operators who aren’t licensed or sanctioned by the city. People land there for the cheap rent and the promise of employment training or other programs, but upon arrival, many tenants find unbearable living conditions, unscrupulous landlords and little recourse for reporting either. Houses flout building regulations by crowding too many tenants into rooms or introducing restrictive rules. It’s becoming widely recognized that many of the houses deserve to be closed. The question is, where to put residents displaced by their closure?

“We don’t want anyone to become homeless as a result of city actions, if that can be avoided,” Stephen Levin said at the joint hearing of the General Welfare committee, which he chairs, and the Housing and Buildings committees. “Ultimately we do not want to rely on a three-quarter house system, I think we all agree on this. It is a bad system, an unregulated system, it is rife with corruption and fraud … it’s a bad thing.”

Even though they are loathed by housing advocates, elected officials and tenants living in substandard conditions, the three-quarter houses still thrive in part because there are so few supportive or permanent housing units available for relocating people.

The de Blasio administration launched a task force in June 2015 in response to a New York Times report exposing some of the system’s most rampant abuses. One operator, who was charged with forcing tenants to get Medicaid-eligible medical services from providers in return for kickbacks from their doctors, was later arrested for fraud. Another chain, Narco Freedom, which had nearly two dozen locations at its peak, closed after similar charges.

The task force inspected 95 buildings and moved 428 people from 44 of those to temporary emergency housing offering case-management services. (The nonprofit Samaritan Village is contracted to receive most of those clients.) But they represent a fraction of more than 10,000 residents living in an estimated 317 sites, according to a 2013 report from the Prisoner Reentry Institute at John Jay College.

But even finding these three-quarter houses presents a challenge. Over the past year-and-a-half, city officials have had to use forensic techniques in order to locate them. At the council hearing, Human Resources Administration Commissioner Steven Banks said the city’s approach included identifying addresses housing at least 10 unrelated people receiving benefits, calls to 311 and intelligence from housing advocates. He said city investigators haven’t gone to each of the sites identified in the report because some have already relocated. “We know that operators open places, close places, open places, so we say to ourselves, if we’re going to put these kind of resources on a problem that hasn’t been looked at in 20 years, what’s the best way to do it first?” Banks said.

Following the New York Times piece, the city stopped referring people to the centers, but other providers, supervised-release programs and word-of-mouth still drive clients.

Before the hearing, advocates from the Three-Quarter House Tenant Organizing Project and nonprofit MFY Legal Services rallied for the City Council to pass a package of legislation, which includes five bills and a resolution. Since the city lacks the ability to quickly identify, fine, inspect or shutter these houses, the package contains mostly tenant-facing changes that represent low-hanging fruit in the effort to improve conditions for residents. Councilman Corey Johnson, a sponsor of one of the bills, said “scumbag landlords are taking advantage of vulnerable populations” and that people needed stable places to regain control of their lives.

The city has aggressively tried to address the unregulated units over the past 15 months, but said some of the proposed bills could overrule agencies’ response to the problem.

Three-quarter houses, heavily concentrated in central Brooklyn and southeast Queens, are one of few affordable options to those who receive a $215 monthly rent voucher – unchanged since 1988. City Council Speaker Melissa Mark-Viverito backed a resolution in the package urging the state Office of Temporary and Disability Assistance to raise the public assistance rental allowance level.

The package also includes tools to bar landlords from forcing tenants to undergo medical treatment and helps tenants access emergency relocation services.

“When the city puts a vacate order on somebody’s building and people get kicked out, the city is supposed to help you relocate to safe stable housing,” said Michael Grinthal, a supervising attorney at MFY Legal Services, which supported the legislation. But those domiciles rarely issue leases or allow residents to get utility bills or mail in their names, making it difficult for tenants to apply for benefits. “What we see at MFY is that over and over and over again, the tenants get sent away.”

Anne-Marie Hendrickson, a deputy commissioner at the Department of Housing Preservation and Development, cautioned against a move she said would “effectively overturn” a rule offering a 90-day window for vacated tenants to apply for relocation benefits. She also opposed a bill that would codify the evidence needed to verify tenants qualify for relocation services, on the grounds it would reduce its flexibility in choosing what documents to accept, and may also conflict with an impending court decision.

Banks requested tweaks on one bill - which would require HRA to compile and report information about violations - saying it could have the unintended consequence of displacing residents and violating their confidentiality. But he agreed, at least in spirit, with a bill that would ensure that tenants receiving shelter allowance from the city are notified of their rights.

Jumaane Williams, chairman of the Housing and Buildings Committee, said the situation was a byproduct of the shortage in sustainable places to live. “We have to look at everything that we do in city government and how that pushes the pressure on housing for these unscrupulous people to exist,” he said. “Whether we’re talking about the state dealing with rent regulation, when we’re talking about rezonings that do not have the adequate affordable housing in those communities. Everything that we do is causing this.”

This article was first published on our sister publication, New York Nonprofit Media on October 7.