Mayor Eric Adams stood with public housing residents in Harlem on Monday and urged lawmakers in Albany to pass legislation that supporters said would unlock “billions” in new funding to make much needed repairs to the city’s deteriorating public housing stock.

The New York City Housing Authority (NYCHA) oversees a sprawling network of about 176,000 apartment units that currently requires an estimated $40 billion to fix busted boilers and broken elevators, replace water pipes, and make other desperately needed repairs. But the legislation under debate in the state Assembly in Albany has been controversial because it would change how thousands of public housing units are classified with the federal government, raising fears for many tenants and advocacy groups who said the plan could threaten many of the rock-solid protections that NYCHA residents currently enjoy.

“They definitely will lose rights under federal law,” said Assemblyman Harvey Epstein, who opposed the bill, and whose district contains 13 NYCHA developments in Manhattan.

Those rights include the ability to pass an apartment on to the next generation, to have an administrative hearing before NYCHA can move to evict tenants, and to organize and form tenant associations and get money to pay for those activities.

As it’s written, the legislation, introduced in the state Assembly in May 2021, would establish a new entity called the New York City Public Housing Preservation Trust, a public-benefit corporation that would be responsible for converting thousands of NYCHA units from what’s known as Section 9 of the U.S. Housing Act – which first established funding for public housing in the 1930s — to the program known as Section 8, which provides vouchers for eligible low- and moderate-income families to rent housing in the private market.

On Wednesday, days before the end of the legislative session on June 2, Sen. Julia Salazar of Brooklyn introduced a new bill in the upper house that mirrors the assembly version. Salazar’s spokesperson, Alvin Pena, did not respond when asked why the senator waited until the last minute to put forth her proposal.

On Thursday, Mike Murphy, a spokesperson for Senate Majority Leader Andrea Stewart-Cousins, said the leader is hopeful the state Senate bill can move forward for a vote.

Public housing is constructed, owned, and operated by a public agency and receives much of its funding from the federal government. NYCHA is the largest public housing authority in the country, while many other cities don’t have public housing. Congress has cut funding for public housing under Section 9 over the several decades, leaving the authority with insufficient funds to maintain the buildings and make repairs. Section 8, which is more widely used across the country, enjoys broader support in Congress. And, the subsidies not only help renters pay the rent but also benefit private landlords who receive rental payments.

In 2019, the average unit in the Section 9 program received $1,250 a month in federal funding, while the average Section 8 Tenant Protection Voucher received $1,900 a month, an extra $650 per unit per month, according to Greg Russ, NYCHA’s chairperson and chief executive officer.

Under the pending legislation, the newly formed trust could then use that steady stream of extra federal dollars to issue bonds as a means to raise additional funding — essentially borrowing money from private investors.

“So, for example, you could have a dollar extra income that could leverage $5 in debt,” Russ said.

If passed, the legislation is estimated to convert roughly 25,000 NYCHA units from the Section 9 program, though Russ said NYCHA will continue to own the buildings and land they sit on. And, he said all residents can vote to opt into the new program.

In addition to having the ability to raise private capital for repairs, the trust would bypass the onerous procurement process, allowing for faster renovations and repairs.

Out of 50 residents associations in New York City, 35 groups representing about 50,000 tenants support the legislation, Russ said.

But opponents of the proposal are skeptical.

Earlier this month, the Citywide Council of Presidents of NYCHA Tenant Associations, a body that represents residents across the five boroughs, wrote to state lawmakers urging them not to pass it because they believe the state and the city should provide direct funding to support affordable housing for the roughly 400,000 residents who live in public housing in New York City.

“We fight for Section 9 Public Housing because it belongs to us – these are our homes,” said Daniel Barber, the group’s chairperson. “The promise of stability, opportunity and equity was guaranteed through legislation by way of the Section 9 lease.”

Marquis Jenkins, co-founder of Residents to Preserve Public Housing, formed three years ago to oppose the legislation when it was first introduced in 2019, said lawmakers are pushing the plan on residents.

“The vast majority of residents do not understand this plan,” said Jenkins, who urged state lawmakers not to pass it this year. “They have time. They can take six months and educate the residents and get real feedback and try to introduce this again in January.”

Jenkins argued that, because the proposal loads more debt onto NYCHA developments – an arrangement he likened to taking out a mortgage on a property – it opens the housing authority up to risk if the trust was unable to pay those debts in the future.

“The developments or the property then goes into foreclosure,” Jenkins said, adding that if the law passes, he believes it will further erode the Housing Act’s guarantees to provide public housing for low- and middle-income Americans.

“There'll be no more public housing in New York City if this plan goes through,” Jenkins said.

Opponents also said they were concerned about eligibility. Unlike Section 8, they said NYCHA tenants are not subject to income limits under Section 9 in determining their eligibility to stay in their homes.

“Section 8, you have to qualify for that. There's no guarantee,” said Aixe Torres, 69, president of the Alfred E. Smith Resident Association, a NYCHA development in downtown Manhattan. “Unlike in section 9, you pay 30% of your income for rent, and that's it.”

Russ, NYCHA’s chairman, said there is a provision in the bill that would permit tenants with income over the federal limit to receive Section 8 vouchers to remain in public housing.

“The bill also makes it clear that those higher-earning families will retain their units,” said Russ.

The bill’s sponsor, Assemblyman Steven Cymbrowitz, who chairs the Assembly Committee on Housing, said he’s confident the bill will pass the lower house before the legislative session ends.

Gov. Kathy Hochul, who also supports the bill, said on Tuesday that if the Senate doesn’t pass the bill the legislation will be introduced again next year.

“I do believe that has a chance of survival,” Hochul said.

This story has been updated throughout for clarity and new developments