Giuliani was sworn in as mayor on January 1, 1994. Joan Malin was appointed commissioner of DHS on February 24, 1994, with Muzzy Rosenblatt staying on to become first deputy commissioner. Before she became DHS commissioner, Malin had worked as deputy commissioner under Dinkins and had helped develop the Tier II shelters under Koch.
According to Malin, “in the Koch years . . . it was totally crisis management . . . how we get through the day, how we get through the night. . . . It is like headline avoidance policy . . . how do we do things that are just not in the press all the time?”1 During the Dinkins years, the city at last developed, through the Cuomo Commission, a vision of what homelessness policy should look like. Again according to Malin, “The Giuliani folks when they came in, basically said we don’t disagree with that policy, we want to continue the work of the Cuomo Commission. . . . But they also put more emphasis on operations, in terms of how to manage numbers.”2
Just the existence of DHS as its own agency and not part of HRA revolutionized homelessness policy from what it had been earlier. For Malin, being independent
[a]llowed us to focus in the way that we would not [have] been able to do at HRA and I say that because I was at both places. You know, as a commissioner, you’re at the table with the deputy mayors and when they’re making changes in the budget, or they’re thinking about allocation of resources, or vacancy control or whatever, you can advocate for your organization. When you were within HRA, HRA had to advocate for you along with five other mini-organizations and you never get the priority unless there was something so urgent and so crisis-driven that you had to be able to do it. And so to me it made a huge difference . . . your ability to negotiate with NYCHA, with HPD, and from commissioner to commissioner. And that was significant.3
Nonetheless, the department’s existence remained tenuous. In September 1995, as provided for in the original enabling legislation, the City Council revisited the question of whether the department should continue to exist. By a vote of thirty-two to thirteen, with one abstention, the council voted to extend the life of the department to October 1996. A condition of further renewal was that the department end its use of large hotels without kitchens in each unit. A 1993 law allowed the department to house families in hotels for up to sixty days as it looked for permanent housing for them. For stays of longer than sixty days, the law held that only hotels of one hundred units or less could be used and that each unit had to have a kitchen. As of September 1995, the department was still using hotels that violated both provisions. Another sore point for the council was the department’s continued practice of having families sleep in the EAU as shelter was sought for them. Despite these shortcomings, the council voted to reapprove the department for a year. One observer’s comments, those of Gretchen Buchenholtz, executive director of the Association to Benefit Children, captured the general sentiment: “There are serious problems with the hotels and the EAU. But given the limitations, I think that any day I would prefer to have the agency continue in its independence than see it go back into a bureaucracy like the Human Resources Administration.”4 But bitter disputes over the existence of the department, and over the terms of its existence, would resurface later in the Giuliani administration.
Early on in her tenure, Malin had a big impact on policy. Only about a month after Malin’s appointment, a mayoral spokeswoman acknowledged that “the Mayor is relying on his new Commissioner for Homeless Services, Joan Malin, to help formulate the policy that will guide this administration.”5 For example, Malin reported to Giuliani that some of the positions he had taken during the recent campaign were untenable. Giuliani had proposed that stays at the shelters would be limited to ninety days. Malin pointed out that this was simply illegal: “With the court mandates and the whole regulatory framework from the state . . . one really couldn’t do ninety days and out.”6 Giuliani had also proposed to challenge the court decisions that established a right to shelter. Malin advised otherwise. “The public doesn’t want us to walk away from the right to shelter. They just want us to do it better,” she argued.7
The big question then became, How could the city legally impose some kind of limits on the use of the shelters? The administration wanted to be able to say to clients,
We do our part, they do their part, but there’s some point in which we can say this is a limited resource for people very, very much in need and then when we’re done with our part, we’re done. And we can ask people to leave. A lot of the policy was trying to figure out how to do that, recognizing the constraints of the mandates that we were under and the state regulations we were under.8
As we saw, the Cuomo Commission had already developed the public idea through which such limits would be achieved. This was the concept of “a mutuality of obligation” or “a balance of rights and responsibilities.”
This public idea was not likely to be ignored because in the highly competitive political environment of New York at that time, all parties had strong incentives to “claim” a potentially popular idea.9 Who would take it up? Though he himself had organized the Cuomo Commission, Dinkins chose not to emphasize its main idea, probably because he had been a prominent supporter of the strictly rights-based approach the commission was implicitly criticizing. And so a political opportunity was handed to Giuliani, who pounced on the ideas developed in The Way Home. Giuliani campaigned on a platform of introducing a “mutual responsibility” model in the shelter system.
In short, Giuliani can be thought of as a political entrepreneur, marketing the public idea of “balancing rights and responsibilities” and winning electoral support with it. This conception of social policy reform came with Giuliani into City Hall, where it shaped the particular outline Giuliani’s social welfare policy in general was to take. Thus welfare reform under Giuliani took the form of imposing work requirements as a way in which welfare clients could “give something back.” Giuliani hoped to impose similar requirements on shelter clients, and throughout his term he would struggle against courts, state regulations, and advocates to do so.
In May 1994, DHS released the document “Reforming New York City’s System of Homeless Services,” which explicitly embraced the Cuomo report and its concept of mutual obligation, which would become a primary reform objective of the department:
Eligibility rules ensure that those most in need of assistance and services have access to them. . . . Mutual responsibility will be established through an agreement known as an independent living plan, signed by both the provider and recipient, which indicates the homeless persons’ acceptance of the responsibility to participate in programs provided to assist them in resolving their crises and in moving toward independent living, mutual responsibility.10
A policy of mutual responsibility could also be described as paternalistic, though the Giuliani administration did not use that term. But how to enforce paternalism? In late 1994 it seemed the city might be able to enforce paternalism through a strong eligibility process. On December 29, 1994, the outgoing Cuomo administration rescinded the state regulation 83 ADM-47, which had required that “[e]mergency housing must be provided immediately if a homeless person is determined eligible.”11 The new regulation, 94 ADM-20, instead stipulated that “[i]t is the expectation that assistance will be provided within 48 hours of application for such [temporary housing] assistance.” The regulation also encouraged policymakers who believed in tightening the eligibility process, for it required that the city “must make reasonable efforts to determine the applicant’s eligibility prior to providing temporary housing assistance.”12 Malin felt that new regulations might make possible a strong eligibility process. “Rather than having to house everyone immediately, having forty-eight hours potentially gave you the opportunity to do more eligibility or to do more of what I would call preventive services in the hopes that would help them stabilize where they are.”13
Thus the administration thought that paternalism could be enforced by having clients sign an independent living plan as part of a stronger eligibility process. In the wake of the Callahan consent decree, no process for determining eligibility for the shelters had been developed because the language of the decree seemed to establish eligibility criteria so broad that any shelter applicant was likely to meet them. The mechanism through which the new mayor planned to enforce paternalism was to “implement a comprehensive eligibility determination process and ensure that scarce resources will be available to those most in need.”14 The administration reasoned that however poor an applicant might be, there was still at least a formal question of whether he or she qualified for home relief or was physically, mentally, or socially dysfunctional. And if upon investigation applicants turned out to meet these criteria, was it not reasonable that they be “expected to cooperate with staff and not-for-profit providers to identify the resources to which they may be entitled, and the assistance and services they need”? If so, and given that the consent decree reserved the right of the state to promulgate regulations for the shelters, couldn’t this expectation be expressed in a written and signed “independent living plan,” as DHS’s reform plan called for? The Giuliani administration asked Governor George Pataki to have the New York State Department of Social Services promulgate the regulations necessary to establish eligibility determinations and the independent living plans.15
At first, the city was not able to persuade the courts of the validity of this approach. Shortly after the new state regulations were promulgated on an emergency basis, New York State Supreme Court justice Helen E. Freedman temporarily barred the city from implementing them as far as homeless families were concerned.16 The Coalition for the Homeless (CFTH) similarly requested of Judge Stanley L. Sklar, who oversaw the implementation of the Callahan decree, to declare the state regulations null and void. CFTH argued that the decree “established minimal eligibility criteria for the purpose of avoiding the disqualification of needy individuals from assistance who were unable to navigate bureaucratic requirements. It is just such requirements that the emergency regulations seek to impose on Plaintiffs now.”17 By 1997, Judge Sklar had not ruled on the permissibility of eligibility requirements and independent living plans under Callahan. The city agreed not to implement the regulations and to notify the court should it decide to do so. While all parties awaited Justice Freedman’s decision regarding families, the city developed an implementation strategy that would pass muster under Callahan.
If overt paternalism in city-run shelters was stalled in court, the city found another strategy to achieve the same end: privatization. Before the late 1980s, contracting out for shelter provision had not been a major city policy. Both Manhattan borough president David Dinkins and the City Council criticized what they believed was the city’s underuse of nonprofits as shelter providers.18 Perhaps in response to these criticisms, in its 1987 final report Mayor Koch’s Advisory Task Force on the Homeless signaled a change in direction by recommending that the city “increase participation by nonprofit service providers and other private sector groups in developing and operating temporary housing.”19 Despite his earlier support for the direction, however, when Dinkins became mayor in 1989 no dramatic privatizations took place, partly because other policy developments, especially the crisis in homeless families, distracted his attention. When the Cuomo Commission reported, it also recommended that the city “not-for-profitize” the shelter system. The city should “refer individuals in need of service out of the shelters and into appropriate, existing not-for-profit residential service programs.”20 Although this recommendation really only restated Dinkins’s earlier support for nonprofits, the commission’s suggestion that the increased supply of apartments available to shelter families had caused the surge in new entries divided the administration and prevented action. In May 1994, Malin’s plan for reforming New York City’s system of homelessness services made the development of “small, community-based programs, provided by not-for-profits,” one of its ten primary objectives. “The not-for-profit community has been at the forefront of identifying and providing for the needs of homeless people. An even greater reliance will be placed on it to deliver these services.”21
Switching from a mostly city-operated system to a privatized or not-for-profitized system was a daunting managerial challenge. Malin described the task as follows:
[Coming] out of HRA, then trying to create a new agency and with a new mindset and . . . thinking about things in a new, different way . . . that’s a very challenging thing to do from an organizational perspective in any event. [It’s] particularly challenging to do when many of the same people are coming over and there was not a lot of latitude to bring in new people. Resources were tight, the civil service rules, and all that kind of stuff. That is just huge. At the same time you’re trying to manage a very large budget, you want to make policy changes. Shifting to a nonprofit-based system requires a whole different way of thinking of the way you do work. I mean you had people for the last ten years—and I will say there were some wonderful people that I worked with, whose hearts were in the right place and they really worked very hard to get the three hots and a cot, the whole thing—that’s not the same thing as managing a contract.
Once you’re contracted to a nonprofit, how do you work with that nonprofit? How do you not micromanage and yet assure accountability of public resources? [How do] you know the city is getting what it’s asking for in terms of quality services and how do you think about quality services? This is a whole different way of thinking about the delivery of care and that was a big challenge, to get the same people who were doing the other stuff to think about it a different way and [do] different jobs. [And] at the same time you are managing.22
Despite the challenges, privatization advanced under the Giuliani administration as never before. In 1988, 73.1 percent of single men’s shelters were operated by the city, and 26.8 percent were privately operated. By 1996, 45.7 percent were city run and 54.3 were privately run.23 Family shelters were also privatized. By 1996, 72 percent of homeless families were sheltered in private, not-for-profit shelters.24 By the end of 1998, most of the eighty family shelters had been turned over to not-for-profit organizations.25 What, then, were the consequences of the privatization, or, more accurately, the not-for-profitization, policy? Consider the fate of the Men’s Shelter at 8 East Third Street as it was in 1997.
A revisit to the Men’s Shelter at 8 East Third Street in the late 1990s revealed an institution seemingly transformed as thoroughly as any pumpkin ever was by a fairy godmother. The building had been completely cleaned, repainted, and redecorated. The stale smell was gone, not to be found even in the facility’s washrooms and kitchen. (To accomplish this it was necessary to tear up the sidewalk outside the building and lay new concrete.) The men themselves were clean and better clothed.
But as striking as the improved quality of life was the change in practices at the new 8 East Third Street. No clients were to be seen on the street. The men were issued laminated ID cards, and everybody wore them, visible for all to see. There was no pointless waiting or wandering. All the men one saw were either obviously doing something—attending a meeting, providing security, doing clerical or cleaning work—or seemed to be on their way to do something. Nothing untoward was said or done to me during my visit. Indeed, when I entered one dormitory, a man who was also a sort of watchman got up from his desk, shook my hand, and bade me welcome. It turned out he thought I was a new client, who should be greeted in this fashion as standard operating procedure.
Besides the obviously improved levels of amenity and order, 8 East Third Street’s program—the set of distinct services, procedures, and achievements that clients are expected to complete in some specific sequence—had also been revitalized. Fourteen years previously, as the intake point of the men’s system, the facility had not had a program beyond the interview with the “5 x 8 staff.” A small infirmary that slept some dozen men was the only on-site service available. For everything else, including shelter and food, men were referred elsewhere in the system, or to commercial flophouses in the neighborhood, where the city paid for their stay.
In 1997, 8 East Third Street no longer served as a general intake point but as a program shelter to which men elsewhere were referred. Prospective clients had to already be in the shelter system, suffer from substance abuse problems, and be willing to participate in the facility’s highly structured six-month therapeutic program. Incoming clients signed a contract specifying the cardinal rules they must obey, which included prohibitions on violence, substance abuse, and sexual activity. Clients also agreed to shower daily, keep a neat appearance, and provide urine for drug testing on staff request.
Once they were accepted, residents were assigned a case manager, with whom they worked out a treatment plan that specified attending at least three program meetings a week, perhaps including on-site GED classes or substance abuse meetings. As they completed their plan, they moved through three stages, indicated by the color of a sticker they were given to wear on their identification. Compliance with the treatment plan was monitored by the case manager and enforced through various disciplinary actions. Residents were supposed to complete their plan in six months. If they did not, their stay might be extended for up to nine months. A resident who had not completed his program by then was referred out of the facility to another shelter with a less demanding or more appropriate program. Thus the changes at 8 East Third were, first, an improved quality of life and degree of order and, second, the development of a strong, mandatory program.
Privatization of the shelters made possible the development of a more paternalistic system. Whereas the courts did not allow the city to levy requirements on clients in city-run shelters, they allowed this in the nonprofit-run facilities to which public shelters referred clients. The Callahan decree required the city to provide some shelter to every applicant and that such shelter be of a specified quality. But the decree had nothing to say about where or how shelter was to be provided. When the issue came up as to whether the Borden Avenue Veterans Shelter (BAVS), a Salvation Army shelter under contract to the city, could require its residents to undergo drug testing, the city successfully argued that it could:
The Salvation Army, if it were a state actor, would not be violating shelter residents’ due process rights by refusing to allow them to stay at BAVS since there is no right to stay in a shelter of one’s choice and since the City will provide alternate shelter to residents who do not wish to subscribe to the BAVS program. . . . The consent decree in Callahan wherein New York City agreed to minimum standards for homeless men’s shelters does not [affect] this issue.
Under privatization, the shelter system developed two tracks. Clients who requested shelter from the city without requirements could get it in such city-run general shelters as the Thirtieth Street Shelter at Bellevue Hospital, which, besides serving as the intake point to the single men’s system, was a general population shelter for some 520 residents. Another city-run general shelter then available was the upstate Camp LaGuardia Shelter with approximately 1,000 clients. These facilities offered little in the way of services and programs. They did not enjoy the best reputation, but they were subject to the quality and access specifications of the Callahan decree, and in providing them the city fulfilled its legal responsibilities.
To get better programs and services, shelter residents had to volunteer to enter the so-called program shelters, those that offer a set of services aimed at the needs of some particular type of client. Most program shelters are run by private nonprofits. This is so not because public shelters are incapable of offering programs; for example, the Greenpoint Shelter with its program for substance abusers is city run. But since the state will only approve and subsidize those private shelters that offer some specific program, desirable programs tend to be in the private rather than the public shelters.
And the private shelters have the power to enforce rules that the city lacks. Because clients have no right to a particular shelter, private shelters may require and enforce participation in their program as long as noncompliant clients are free to return to a general shelter. The two-track system gives clients a degree of choice that is not available in an all city-run systems. It also makes possible an exercise of authority that is less drastic, but perhaps more effective, than the impermissible denial of city shelters. Indeed, the provision of choice and the existence of a useable sanction go hand in hand. It is because clients make a voluntary choice to go to a certain program shelter that the shelters can reasonably expect clients to adhere to their program. For what sense does it make to volunteer for a program of which one wants no part?
To get a sense of how the private nonprofits operate, it is useful to look at one of the oldest of these shelters, the Borden Avenue Veterans Residence (BAVR or, less commonly, BAVS). This shelter illustrates how the system has taken advantage of its de facto two-tier structure to become more paternalistic. It is also one of the best-documented shelters because of the work of anthropologist Janice M. Hirota.26 BAVR’s program material makes clear its authoritative philosophy:
To create an atmosphere where staff and veterans know how to proceed, BAVR has developed a two-part contract that “obligates” the new arrival to a social service plan that will lead to “mutual goals” agreed to by the man and the administrators of the residence.
Part A of the contract is the price and ticket of admission. The man must be a veteran, and he must come from one of the more than twenty shelters in the city’s system. The A Contract outlines the rules and regulations the veteran will be living by at BAVR. It leads to the signing of the B Contract. The B Contract calls for the man to “establish and comply” with a service program tailored to his individual needs. If the man fails to comply or breaks the rules after admission, the Borden Avenue Residence has the authority through the contract to put him out. Other shelters in the city, not nonprofit agencies, have a hard time imposing that kind of discipline. Because of the contract, BAVR stands as a beacon that guides its residents toward the ultimate goal of independent living, dignity, and self-confidence through job placement and work.27
It should not be thought, however, that the threat of dismissal from the program shelter and the fear of returning to a general shelter are the sole or primary means by which the two-tier system exerts authority. These concerns are real, but cannot regularly serve as the main source of discipline. Many clients, despite their having chosen to apply to BAVR, see their signing of the contract as involuntary or as an empty prerequisite. Indeed, a past director of the shelter has acknowledged that the contracts are primarily management tools rather than sources of realistic sanctions.28 The force of the contract comes not so much from formal sanctions as from the tie it helps establish between the client and the institution. Thus Hirota writes, “The contract system is emblematic of what is, from a social service point of view, the ideal relationship between worker and resident. Within such a system a client’s problems are recognized and resolved by worker and resident working together in an individualized relationship of mutual respect and reciprocal accountability.”29
Thus the contract represents written recognition by the client that he has certain problems (often some form of disability, but always at least the need to search for permanent shelter). It therefore establishes a basis for social service staff to periodically review the client’s efforts to deal with those problems. In this way they may prompt him to fulfill the program.
The BAVR program is clearly paternalistic. It assumes that clients have some kind of “problem.” They need help to “do the right thing” about it, and such help will be “good for” them. These assumptions are expressed more or less subtly. Al Peck, former director of BAVR and now director of homeless services for the New York City Salvation Army, expresses them bluntly:
Many of the veterans suffer from multiple dysfunctions. Most prominently, drug and alcohol addictions, exacerbated by post-traumatic stress disorder (PTSD) and other mental illnesses, with resulting physical health problems. These must be treated before a veteran can make a successful transition to independent living. “We can find them jobs and a place to live, but if they don’t address their real problems, it’s only a matter of time before they lose the job and end up back on the streets, or in some other shelter,” said a social worker in the early days of the shelter. Since jobs were not the only answer, a system was set up to encourage those veterans who wished to change their lives from homelessness to be contributing members of the community.30
But clients do not face only clear-cut disabilities. Many display a set of behavioral and attitudinal stances that Hirota termed “drift,” which “means a basic lack of self-direction. . . . Drift seems extensive among BAVR residents; in particular, it marks their approaches to important personal decisions, including whether to stay or leave the shelter, what to do all day, and how to handle money.”31 Whether in fact most BAVR residents, or shelter clients generally, tend to drift is a question, and Hirota herself acknowledges that this trait “tends not to be captured in the available statistics.”
The BAVR program, however, clearly assumes that left to themselves, clients will tend to drift, and that therefore “structures and programs [must] help clients make choices that will break the pattern of drift and thus encourage them to take control of their own lives.”32 The key aspect of the BAVR that Hirota identifies as encouraging clients to take control of their own lives is the nine-month review.
This process follows up on the A and B contracts clients signed earlier. After 270 days in the shelter (consecutive or not), the client and his case worker meet with a review board consisting of the director of the shelter, the supervisor of social services, the head housemaster, and sometimes representatives from other shelter services. The case worker has prepared a file on the client that includes a brief evaluative summary, an updated confidential medical report, the amount in the client’s savings account, and a status report from the shelter employment programs. The board reviews the client’s activities for the past months and his present and future plans, including his plans for leaving. The client makes a statement and the staff asks questions, which typically focus on substance abuse problems, emotional issues, and the search for permanent shelter. Out of this discussion the board generally makes specific service recommendations that are then drawn up in the form of a new B contract, which is scheduled for review in thirty to ninety days.
The review reinforces the shelter’s paternalistic regime. First, reviews are a low-key method of enforcing the obligations clients enter into in their A and B contracts. They are performed not so much because clients might fail to “pass” the review and end up being sanctioned (most reviews end with the redrafting of the contracts) but because reviews provide the shelter administration and staff with an opportunity to concentrate their informal authority. The highest representatives of the shelter administration—the shelter director and the director of social services—take part in drawing up a new contract, which “puts teeth into whatever recommendations are made.” Further, a review presents the client with a unified voice from the shelter administration and staff, and thus “limits chances for the client to play any end against the middle.” Finally, without threatening to immediately eject a client, the review reasserts the temporary nature of shelter stays and thus focuses a client’s attention on the need to search for a permanent situation.33
The other program shelters of the city system display the same directive orientation as BAVR. Project Renewal employs the referral-contract program-monitoring model, as does the Ready, Willing, and Able shelter operated by the Doe Fund in Brooklyn. In general the trend toward privatization has made possible the development of a paternalistic shelter regime that could not have been achieved through other means. However, as we shall see, the paternalistic regimes of the program shelters had their limits. In particular, the question of what to do with the clients who for various reasons would not volunteer to enter a program shelter was unresolved and would eventually force the city to consider significant modifications in the paternalistic philosophy. In short, shelter quality and management improved dramatically during the process of not-for-profitization. Another example of this trend involved the transition of a facility, not from public to not-for-profit management but from for-profit to not-for-profit management. The transformation of the Times Square Hotel from a dilapidated, infamous welfare hotel in the late eighties to, in 1994, a multipurpose residence stunningly renovated to recapture the faded beauty of its heyday from the twenties through the sixties was remarkable. An account in the New York Times from 1989 paints a picture of how bad things had become:
There are only two single beds in the room at the Times Square Hotel where Kimberly Andrews, her husband and their 5-year-old son, who are homeless, have been living since September. The paint is peeling so badly from the walls onto the stained carpeting that Ms. Andrews routinely sweeps twice daily. The family’s room, on the 12th floor, does not have window guards or a smoke detector.
The elevators break down constantly, the rates are exorbitant ($2,640-a-month for Ms. Andrews’s room), children play in hallways where drugs are sold and many muggings have occurred. . . .
City officials acknowledge the conditions at the Times Square—hundreds of violations are documented in their own inspection reports—but say they have nowhere else to place the families.34
A later account documents the change:
Visitors to New York sometimes try to check into the Times Square Hotel, not realizing it is a supportive housing facility.
It is an understandable mistake. The 15-storey art deco building is attractive, well-maintained and stylishly furnished. Its vaulting lobby and marble staircase bespeak the elegance of a bygone era.
[In the late eighties,] the hotel was a dump. Its ceilings were caving in. Its halls were dark and dangerous. Its tenants—drug addicts, homeless families and elderly people with no place else to go—shared the premises with rats and maggots.
In 1994, the beautifully restored Times Square Hotel emerged from its scaffolding. . . . Today, the hotel is home to 652 proud, stable, well-cared-for residents.35
The Times Square was the largest of what was to become the most common form of supportive housing, that is, a supportive SRO (single room occupancy), which provides various types of apartments with on-site supportive services. At the Times Square those services were offered by the Center for Urban Community Services (CUCS), the same provider that worked at Ellen Baxter’s pioneer supportive housing facility, the Heights. A striking feature of the Times Square was the diversity of the populations it served: 130 clients were in rooms built and supported under the New York/New York Agreement for housing the mentally ill. Fifty-three units were devoted to formerly homeless people who did not suffer from mental illness, fifty units were devoted to people living with AIDS, and the remainder of the units were for elderly and low-income workers, including many artists from the local cultural scene.
Rosanne Haggerty was the policy entrepreneur behind the renovation of the Times Square. She was a recent graduate of Amherst College, and had been working on housing-related issues for Catholic Charities, where she became familiar with the then new and little understood Low Income Housing Tax Credit (LIHTC), which would become a key part of the financing of the Times Square renewal. In 1991, barely thirty years old, she got the seemingly unlikely idea to turn the decrepit old building, then in bankruptcy, into the world’s largest supportive housing project. Though a neophyte, she displayed a knack for formulating plans and communicating them to diverse interested stakeholders. A key early supporter was the local Community Board 5, chaired by Nicholas Fish, who reported, “she won over Board 5 by disclosing not only her general plans but also detailed financial data, including the formal prospectus for bank lenders.”36 Crucial support also came from Mayor Dinkins, who arranged for city acquisition and reconstruction financing. Haggerty described the process of selling her idea and getting it realized:
What was so remarkable about the experience was I didn’t have the backing of an organization, but just the idea of there was a way to save this building by taking basically smart ideas from other places, around mixed-income housing, around integrating jobs, around creating the robust supports that people would need to get back on their feet, and that it was actually highly efficient economically to do this. And that there were other populations besides individuals who were homeless who were seeking and would benefit from affordable housing in the Times Square area. Those were basic ideas that were all true in themselves but connected. There were examples around the country of good-quality mixed-income housing. There were good examples on a smaller scale of supportive housing, like Ellen Baxter’s work. . . . I had learned in my work at Brooklyn Catholic Charities how important it was to also deal with linkages to jobs and good access to transportation and that all these things really mattered in terms of the success of any community. And that there were other groups whose needs could be complementary to those of the homeless. For instance, low-wage workers seeking affordable housing in the arts, or in the hotel industry, who were part of the Times Square economic ecosystem.
So anyway, putting these ideas together struck so many people as obvious. . . . Really these ideas are logical, have been proven somewhere else, and the trick would be to integrate them. And what was so compelling was I immediately got support to keep going with this idea from what would seem to be unlikely places. Like the business community in Times Square. Like the Community Board. Unions that wanted housing for their members like the hotel industry and the actors’ and related unions. And that there were so many groups who typically wouldn’t be in the same room together who actually saw themselves as having a stake in having a solution to a policy challenge or a couple of policy challenges: big bankrupt buildings, needing better solutions to homelessness, wanting to spur positive community development in Times Square. And so this notion that very unusual coalitions can come together even around really edgy challenges the city faces is something that is the big takeaway for me from the whole Times Square experience.37
Alongside these breakthroughs in developing and managing facilities for the homeless, the legal machinery of McCain continued to operate and act as a driver of policy. By the time of the Giuliani administration in 1994, Justice Freedman herself would observe that “[t]he purpose of the fines was to secure compliance with legal requirements, but that does not appear to be happening.”38 Freedman deployed her new approach on November 22, 1994, when she appointed as special master one Kenneth Feinberg, who was well known for his work as a settlement master and referee in asbestos litigation against New York City and would later serve as head of the U.S. government’s September 11th Victim Compensation Fund. Soon after, lawyer Barbara Cutler would become his assistant. On February 1, 1995, through a consent order overseen by the court, the parties agreed to a plan that had been negotiated by the special master and that, among other provisions, suspended the prospective fine mechanism for a period of six months. Feinberg described his role as a special master as follows:
What we did was, whenever there was a crisis—overcrowding, failure to provide appropriate services, procedural roadblocks at the intake offices, eligibility criteria— . . . instead of these problems becoming a major confrontation in the court room, we would attempt, with success sometimes, to at least avert a legal crisis by working something out. . . . We periodically avoided situations in the courtroom by having what we called Band-Aid reforms that would alleviate the immediate crisis. . . . Everybody wanted to keep it out of the court. “Let’s not go before Judge Freedman, let’s not force her to act.” And that’s what we did for a number of years.39
Feinberg entertained some opinions that were perhaps surprising for someone in the middle of an intense institutional reform litigation. He believed that “the courts are a poor arm of government for imposing structural reform on public policy issues like homelessness.” And he subscribed to the perversity argument, saying, “I was always skeptical that the bulk of the individuals who were in the intake center claiming homelessness were homeless. . . . My experience in New York City . . . was that much of the homeless problem was self-generated.” But given the situation, Feinberg saw no alternative to dealing with the problem through the courts. Feinberg felt that the criticism directed at Justice Freedman was
[v]ery unfair. What do those critics want Justice Freedman to do? In the abdication of ultimate responsibility of other branches of government to solve the problem, why is Justice Freedman a target? . . . I always said to critics . . . “You have a better way? What’s the solution? Will you come up with a solution that will permit Justice Freedman to bow out? She’ll bow out. I’ll bow out. I’m not very comfortable micromanaging the homeless system in New York City.” And that sort of quieted the critics.40
The February 1995 plan outlined the role of the special master and called on the city to take a wide range of “immediate actions.” These included increasing the staffing at the EAU and at welfare hotels; establishing procedures for providing families with brokers’ fees and other expenses to help them relocate in permanent housing; ceasing referring families to congregate shelters where there were active contagious illnesses; distributing at the EAU a wide range of products for small children, including diapers, cribs, formula, baby food, and Pedialyte (a treatment for diarrhea); maintaining security, sanitation, and proper heating and air conditioning at the EAU; and referring domestic violence victims expeditiously to appropriate services.
The provision in this plan that the city EAUs provide Pedialyte—the brand name was specified—soon became a standard piece of evidence in the claim that Justice Freedman had descended into micromanagement of the complex homelessness bureaucracy. The Times noted that “[c]ity lawyers . . . say that Judge Freedman has used her power to manage shelter operations down to the last detail. She has, for instance, ordered that the city make infant formula, bottle warmers and Pedialyte available to homeless families.”41 Also in the Times, Joyce Purnick claimed that “[i]n the last 22 years the court has stipulated almost every detail of the city’s treatment of homeless families—from how quickly families must be placed in shelters to the availability of a particular brand of anti-diarrhea medication.”42
It turns out, however, that the specification of Pedialyte came not from Justice Freedman or the plaintiffs, but from the city. At this point, February 1995, the Giuliani administration was in power and was desperately trying to avoid the contempt charges that had so damaged the Dinkins administration. The city lawyers therefore drew up a plan that was elaborate and detailed enough to get the plaintiffs to hold off on contempt charges. And so Pedialyte was included. The city felt it had no alternative. According to Thomas Crane, then chief of general litigation in the city corporation counsel’s office: “We offered to make it available because we had our backs against the wall and . . . we had no leverage. So we sort of offered up all sorts of things because we had no ammunition. . . . She [Justice Freedman] memorialized something we had offered . . . under duress.”43 Ken Feinberg’s skills as a mediator got Steven Banks to go along.44
The February 1995 plan also required the city to develop and implement within six months a plan for promptly providing families with shelter that met court and regulatory requirements. But the proposed six-month grace period during which fines were supposed to be suspended did not last that long. On June 16, 1995, Legal Aid was back in court calling for new fines against the city for having allowed more than three thousand families to stay overnight in the EAU since January.45 Legal Aid submitted documents showing that conditions in the EAU continued to be horrific. One affidavit of Sanford Friedman, M.D., a professor of pediatrics at Albert Einstein College of Medicine who had experience with animal research, found conditions in the EAU in September 1995 to be “worse than any animal housing I have ever witnessed.”46 Reports from the special masters and a visit to the EAU by Justice Freedman confirmed that many families continued to spend days in the EAU and that conditions were very bad.
On March 15, 1996, a little more than a year after the first set of recommendations of the special masters was presented to the court, the special masters presented a new plan. Not much progress had been accomplished in the past year. After acknowledging the fiscal constraints the city faced, the new plan continued,
The plight of the homeless families [sic] shelter system in New York City has been further impacted by bureaucratic inefficiencies and delays. The outlook is grim.
Although progress has been made in some areas, over the past few months the mediation process has been unable to resolve effectively several conflicts relating to conditions and the overnight housing of homeless families with children at the EAU.47
In other words, the mediation of the special masters had resulted in little progress in improving the shelter system. Much of the new plan simply repeated many suggestions from the old plan that had not been implemented. As Justice Freedman would write in a May 1996 memorandum decision, “In fact over the last year and a half, in spite of the hard work of the Special Masters, the issuance of interim orders, and repeatedly providing additional time, non-compliance has grown.”48 With the special masters not being as effective as had been hoped, Justice Freedman went back to fining the city, even though earlier experience suggested that approach had not worked either.
Representatives of the city and the plaintiffs disagree sharply on the value of Feinberg and Cutler’s special mastership. As Thomas Crane, a lawyer for the city’s corporation counsel, saw the matter,
Freedman, I think, realized that . . . litigation driving the program may not [have] been the best way to do things; she appointed Ken Feinberg as special master and he had—one of his colleagues was really doing the day-to-day stuff, Barbara Cutler. That was not a fruitful special mastership. . . . I think Barbara tended to agree with everything that the plaintiffs wanted.49
Steven Banks, of Legal Aid, while acknowledging that the special masters were not able to resolve big problems with the shelter system, was nonetheless much more positive about their accomplishments:
I think that was a good model, because there were a lot of problems that were able to be resolved with his [Feinberg’s] intervention, and Barbara Cutler’s intervention on his behalf, that would have required court, judicial resources. And from our perspective resolving things outside the courtroom and getting relief for our clients more quickly was a very important thing. And so that period of time between 1995 and 2001 or at the end of 2001 was an important period where having a special master in place who understood the legal requirements and would agree with the city if our articulation of the legal standard was wrong or would agree with us if our articulation was right and our clients were greatly helped and the court was helped because there wasn’t constant litigation. . . . I think on the macro level the progress that was needed was not made. On a micro level a lot of individual families were helped and a lot of problems were solved that would have [gone to court].50
Another set of controversial decisions that Justice Freedman made concerned the requirement that the city place families in legal shelter “immediately.” As we have seen, this requirement originated in the state social service regulation 83 ADM-47, which resulted in repeated sanctions against the city. Effective December 29, 1994, the city got relief from this requirement when the state Office of Temporary and Disability Assistance (OTDA, formerly the Department of Social Services) issued a new administrative directive, 94 ADM-20, which stated that “[i]t is the expectation that assistance will be provided within 48 hours of application.”51 It was widely considered that the new regulation, issued on almost the last day of Mario Cuomo’s administration as governor, was a favor to Giuliani in return for his support of Cuomo during the governor’s losing campaign for reelection. Such was the opinion of Steven Banks, who called the change “a political payoff” and commented, “The governor in his last act is cavalierly saying that families with children can be left to sleep on tables, chairs and floors, This, evidently, is the real Mario Cuomo.”52 Michael J. Dowling, the Cuomo administration’s commissioner of social services, explained the governor’s action differently: “His basic comment is that we’ve got to operate the shelter system so that services are provided to people as quickly as possible, but that our standards have to reflect the reality of the situation.”53
In May 1996 the city returned to court, confident that it now had a longer time period in which to act. But Justice Freedman disagreed. She wrote,
Contrary to the position taken by defendant City . . . I do not believe that the provision of 94 ADM-20 that “[i]t is the expectation that [temporary housing] assistance will be provided within 48 hours of application for such assistance” permits the defendants to leave vulnerable families sleeping crowded together on office floors for two full days. That interpretation of 94 ADM-20 contravenes its provision that “each district is required to comply with all court decisions which apply to the district’s policies related to homeless persons and families.” . . . The overnight housing of homeless families at EAUs or IMCs (now called ISCs) is explicitly prohibited under the July 1986 McCain order, which has never been modified or vacated on appeal. Accordingly, the July 1986 order must be obeyed.
Freedman went on to argue that the ban on overnight stays in offices had many different bases besides 83 ADM-47. She cited various court decisions, the Emergency Assistance Program, state and federal equal protection guarantees, and article 17 of the New York State constitution.54 It turned out that the favor that Governor Mario Cuomo had supposedly done for Mayor Giuliani was much less of a favor than it seemed to be.
The incoming Republican governor, George Pataki, proved to be more helpful. On December 27, 1996, 94 ADM-20 was amended. The provision that districts must comply with all applicable court decisions was dropped. New language that shifted the burden of proving homelessness to the applicant families was substituted. Below is a sample of that language:
The considerable resources now devoted by some districts to temporary housing assistance necessitates that the obligation placed upon districts to assist homeless persons better reflect the balance between the needs of those seeking assistance and the desire of the Department and districts to provide this assistance in a rational, cost-effective manner.
While it is a matter of critical importance to the Department that districts have the means for providing necessary assistance to the truly homeless, the general principle that individuals and families have primary responsibility for securing their own housing remains. (italics added)55
To make the point clear about how the primary responsibility to find shelter was now on the applicants’ shoulders, the city presented the court with an affidavit of John E. Robitzek, acting general counsel of the OTDA (the promulgating agency of the revised administrative directive). The court summarized Robitzek’s interpretation of the revised regulation as follows:
[T]he presumptions and burden of proving homelessness has shifted to the families seeking shelter in that they must demonstrate clearly and convincingly that any previously available housing, whether their own or shared, is no longer available and that they are unable to access any other temporary or permanent housing. He notes that the portions of the ADM’s requiring verification of homelessness have been strengthened and the presumptions favoring homeless families have been weakened or deleted.56
By March 1998 the parties were back before Justice Freedman with the plaintiffs again requesting, among other things, that the city stop leaving families overnight in the EAU. Justice Freedman wrote that
[d]espite the changes in 94 ADM-20 the Court believes that previous appellate holdings in McCain v. Koch, McCain v. Dinkins, McCain v. Giuliani and Robinson v. Grinker mandate enjoining City defendants from finding families who clearly do not have appropriate alternative housing, or who cannot produce all of the documentation required but cannot return to previous housing, ineligible for temporary shelter.57
But the question to be determined here was, After the repeal of 83 ADM-47 and the promulgation of the revised version of 94 ADM-20 on December 27, 1996, how long did the city have to find shelter for applicant families? How long could the city allow such families to stay in the EAU? Did the city in fact have forty-eight hours to determine whether a family was eligible for shelter, during which time a family might stay in an EAU? To answer this question requires some recapitulation. Recall that in 1985,
The city had been required by 83 ADM-47 to provide shelter “immediately.” In Lamboy [Order, Freedman, J., Oct. 2, 1985, at 5, Lamboy (Index No. 41108/85], Justice Freedman held that having a family sleep overnight in an EAU did not constitute providing shelter, and hence families that stayed overnight in an EAU had not been provided shelter immediately.
Then, on December 29, 1994, the city had seemed to get relief from the “immediately” requirement when OTDA had issued a new administrative directive, 94 ADM-20, which stated that “[i]t is the expectation that assistance will be provided within 48 hours of application.”58 The city had therefore believed that it could leave families sleeping in the EAU for two days. But Justice Freedman had disagreed. She had pointed out that 94 ADM-20 also provided that each district was required to comply with all court decisions that applied to the district’s policies related to homeless persons and families.59 On July 3, 1986, Freedman had issued an order that said emergency housing was “not to include overnight accommodations at Emergency Assistance Units.” So, according to Freedman, despite the new regulation 94 ADM-20, the city still couldn’t keep families overnight in the EAU, much less for forty-eight hours.
On December 27, 1996, as mentioned above, the Pataki administration revised 94 ADM-20, which had been promulgated by the outgoing Cuomo administration. Again, the provision that districts must comply with all applicable court decisions was dropped. New language that shifted the burden of proving homelessness to the applicant families was substituted. So now the city concluded that finally it really did have forty-eight hours to find a family shelter and that it could leave a family waiting for that period of time in the EAU.
Steven Banks disagreed. When the Cuomo regulation was issued, it was reported in the Times that “Mr. Banks has argued that rulings based on the state constitution still prohibit the city from keeping families at the office overnight.”60 And after the revised Pataki regulation, Banks continued to argue that the state constitution disallowed having families stay overnight in the EAU and disallowed the city having forty-eight hours to place a family. According to Banks,
So now we’re in ‘95. And we go to court because we’ve got this directive with the city saying “we can leave people sleep there for forty-eight hours.” And we say “you can’t do that.” . . . Now it’s what does the constitution require. . . . The ‘86 decision actually said there is a right to shelter and you can’t let people sleep in the Emergency Assistance Unit.61
The ‘86 decision that Banks was referring to is McCain v. Koch, 502 N.Y.S.2d 720 (N.Y. App. Div. 1986), May 13, 1986. There the Appellate Division of the state supreme court found that “[i]t is also likely that plaintiffs will succeed on their claim that the NY Constitution article XVII obligates defendants to provide emergency shelter for homeless families.” Thus the Appellate Division granted the plaintiffs’ request for a preliminary injunction that would bar the state and the city from denying emergency shelter to homeless families.
The court noted that if this preliminary injunction, requiring the city to provide emergency shelter, were not granted, families would end up staying in the EAUs because the city was not providing them with emergency shelter. EAUs did not constitute emergency shelter but were only offices where applying families waited to be placed in emergency shelter. Thus, unless families were given emergency shelter, they would end up staying in EAUs. The Appellate Division noted that “in the event a preliminary injunction is not granted, they [the applying families] will be forced to sleep on the floors, desks, and counter tops of IMCs and EAUs.”62
Nonetheless, what the preliminary injunction forbade was the denial of emergency shelter; it did not prohibit allowing families to stay in EAUs while their applications were being processed, however long that might take. The issue of how quickly the city must provide emergency shelter had been determined by the “immediately” requirement of 83 ADM-47 and by Justice Freedman’s decision in Lamboy that staying in an EAU did not constitute emergency shelter. But 83 ADM-47 was repealed, and there remained no requirement in the Appellate Division’s 1986 McCain decision that, because of state constitutional requirements, the city could not keep families in an EAU. Staying in an EAU overnight might be unfortunate, but it was not forbidden by the Appellate Division as long as that stay was part of a process of determining the eligibility of a family and providing them appropriate emergency shelter.
In fact, this decision (McCain v. Koch, 502 N.Y.S.2d 720 [N.Y. App. Div. 1986], May 13, 1986) concludes that while it is likely that there is a right to shelter, the courts can’t regulate the quality of that shelter. Thus the decision reads in part,
[T]he adequacy of the level of welfare benefits is a matter committed to the discretion of the Legislature. . . . In light of the broad discretion vested in the Legislature, we cannot conclude that plaintiffs are likely to prove that article XVII substantively guarantees minimal physical standards of cleanliness, warmth, space and rudimentary convenience in emergency shelter.63
So even if one assumes that the Appellate Division of the state supreme court recognized in this decision that there was a right to shelter in the state constitution—in fact, the decision only says, “It is also likely that plaintiffs will succeed on their claim” that such a right exists—it seems the decision doesn’t say anything against letting families stay in the EAU.
In fact, the linking of the Appellate Division ‘86 decision with the prohibition of leaving families in the EAU comes in an order by Justice Freedman dated July 3, 1986. At the beginning of this order, Justice Freedman explained what kind of an order the plaintiffs were asking for:
Plaintiffs herein having sought an order requiring defendants to take adequate steps to comply with the preliminary injunction issued herein by the Appellate Division, First Department on May 13, 1986, which would include providing emergency housing to all eligible families with children but would not include overnight accommodations at Emergency Assistance Units or Income Maintenance Centers.64
Note that this formulation of the plaintiffs’ request does not imply that the Appellate Division’s preliminary injunction forbids overnight stays in the EAU. It implies that the plaintiffs want an order that forbids such stays. Now, Justice Freedman did grant such as order, as follows: “Now, it is hereby ordered and adjudged that city defendants . . . provide lawful emergency housing to all eligible families with children, such emergency housing not to include overnight accommodations at Emergency Assistance Units or Income Maintenance Centers.”65
But the point is that the source of the ban on overnight stays in the EAU is not the Appellate Division’s decision that found likely the state constitutional right to emergency shelter. The source of that ban is Justice Freedman’s order of July 3, 1986. In other words, there is no link between the constitutional right recognized by the Appellate Division and the ban on EAU sleepovers. Or in still other words, the ban on EAU stays is based on a court decision, Judge Freedman’s order of July 3, 1986, and not on the state constitution. But the Pataki revision on December 27, 1996, of 94 ADM-20 removed the language that required the city to comply with court decisions. So in fact that regulation’s provision that the city had forty-eight hours to provide assistance was good.
It is important to note that Justice Freedman sometimes found against the McCain plaintiffs in cases that the Legal Aid lawyers considered essential. Such was the case concerning the promulgation, on January 16, 1996, under New York State Social Service law, of a new section 352.35 to18 NYCRR, which was entitled “Eligibility for Temporary Housing Assistance for Homeless Persons.” The new section provided that homeless individuals and families must cooperate in the development of an independent living plan, which is a strategy developed by the applicant and the city to, among other things, get the applicant out of emergency shelter and into permanent housing. Failure to cooperate in the development of such a plan or to abide by it could result in sanctions, including termination of shelter. Homeless applicants were also required to comply with public assistance requirements, which could include “looking for work, engaging in training, accepting jobs and work assignments.”66 This provision would turn out to be very controversial once the city implemented a large-scale workfare program, the Work Experience Program (WEP), that became the largest welfare-work program in the country. The most striking part of the new section provided that “[p]rior to denying or discontinuing temporary housing assistance . . . the social service district [i.e., the city] must evaluate the individual’s or the family’s need for . . . preventative services for children and protective services for children and, if necessary, make an appropriate referral.”67 In other words, if a family with children had its shelter discontinued due to failure to live up to its independent living plan, its children could be placed in foster care. The plaintiffs argued that this provision was invalid on its face in that it attempted to overrule administratively the May 13, 1986, McCain decision of the Appellate Division that implied a state constitutional right to shelter. Plaintiffs further claimed that “a regulation suggesting a foster care alternative for the children of families who have been expelled to the streets is shocking.”68
On November 16, 1995, Freedman had issued a temporary restraining order enjoining the city from implementing that portion of the regulation that authorized termination of shelter to families with children that fail to abide by their independent living plan. But on December 30, 1996, she denied the plaintiffs’ request to make the ban on enforcing those provisions of 18 NYCRR 352.35 permanent. Freedman wrote,
While this Court seriously doubts the wisdom of a regulation that potentially causes small children or infants to be consigned to the streets for their parents’ or caretakers’ infractions or perceived non-compliance or noncooperation with DSS directives, such a regulation is not on its face so irrational or beyond the scope of DSS’ authority under Social Services Law §20 as to warrant the continuance of the temporary stay. . . . Although valid on its face, the regulation of course cannot be arbitrarily or irrationally applied or applied in such a way as to violate constitutional, statutory or case law.69
Upon a grant of reargument, Justice Freedman still declined to agree with the plaintiffs concerning 18 NYCRR 352.35 and wrote on May 27, 1997, that “the Court remains satisfied that the sanction provisions of the regulation do not on their face violate either the New York State Constitution or the Social Services Law nor do they directly contravene any appellate decision.”70 This decision was upheld on appeal to the Appellate Division on July 30, 1998.71 Thomas Crane of the city’s Law Department believed that these decisions represented a “milestone” in that they allowed the city to begin developing an effective eligibility-determination process.72
On January 12, 1999, Justice Freedman issued an order that again had the Giuliani administration complaining of judicial micromanagement of DHS. By 1996 it had become city policy to find ineligible families applying for shelter who had been living doubled up with other residents immediately before requesting shelter. Indeed, in an interdepartmental memo entitled “Guidelines for Determining Eligibility of Doubled-up Families for Temporary Housing Assistance,” dated August 23, 1996, city policy in such cases was described as follows:
People who resided in doubled-up housing immediately prior to requesting temporary housing assistance are presumed to be ineligible for assistance.
If the family resided doubled-up with a relative, and claims the relative will not permit them to return, the family is determined to be ineligible. It is not necessary to make a field visit in these cases. However . . . a field visit may be conducted.
Application of this policy resulted in scores of families being “booted,” as the New York Daily News put it, from the EAU. But Giuliani defended the practice, saying, “The fact is that we’re far better to force many of these solutions back to families, so that family units resolve these issues before it becomes the responsibility of the entire city.”73
But this policy seemed to be in violation of state welfare Administrative Directive 86 ADM-7, which provided that
[c]ommunity resources, including friends and relatives, which are actually available to the client must be used before an immediate need can be met by the local district. Local districts must not provide assistance to applicants who refuse to utilize such resources.
However, the local district must be sure that the resource is actually available. Unless the client volunteers to use family and friends, the agency must check with such people to see if they are willing and able to help.74
The regulation also provided that applicants found ineligible must be provided with written notice explaining the reason for their ineligibility.
On December 6, 1996, Justice Freedman issued an order that the city comply with the relevant portions of 86 ADM-7 and “make sure that the [other housing] resource is actually available” (brackets Freedman’s) to a formerly doubled-up family before finding them ineligible.
On January 12, 1999, Freedman issued an order that seemed to do no more than restate that the city did indeed have to make sure that alternative housing really was available to families found ineligible because they had been doubled up. The city objected vigorously. Deputy Mayor Joseph Lhota complained that “the advocates want us to diminish eligibility requirements, to shelter people who aren’t homeless but don’t want to go back to their family, and that’s not right.” Lhota’s analysis of the politics of the situation was that “[t]he tug of war is from a desire on the part of City Council and advocates to micromanage the department of homeless services.”75
In October 1999 it turned out that what was at stake was far more than simply requiring DHS to make sure it had its facts right in eligibility determinations. The New York Times reported that
[f]or the first time since the turn of the century, homeless people in New York City will be required to work as a condition of shelter, under a Giuliani administration policy to be put into effect before the end of the year, an administration official said yesterday. . . . The homeless who are able to work and who fail to comply with the rules will be refused shelter, and in the case of families, the children could be put in foster care, said Anthony P. Coles, the senior advisor to Mayor Rudolph W. Giuliani.76
Once the courts had declined to strike down 18 NYCRR 352.35—the state regulations that contemplated denial of shelter to clients who failed to comply with their independent living plan, which could include work assignments—the question was, When and how would the city implement those requirements? City officials had announced that they were getting ready to implement that policy but announced no specific starting date. As of October 1999 most homeless advocates and shelter providers believed that implementation of the policy would be put off at least until warmer weather arrived.77 Thus the decision to move ahead, in the winter, with work requirements and the possible placement of children of noncompliant parents in foster care came as a shock. Steven Banks remarked,
It’s extraordinarily callous, with the cold weather coming now, that the city wants to put vulnerable New Yorkers on the streets. The track record of workfare programs in the city hasn’t been one in which significant numbers were placed in jobs that allowed them to pay prevailing rents. It has been essentially a tool to reduce the caseload through sanctions.78
Legal Aid lawyers asked Justice Freedman for a temporary restraining order preventing the city from implementing the workfare and foster care policies. They also wanted to prevent the implementation of workfare requirements in the singles shelter system and therefore applied also for a temporary restraining order (TRO) from Justice Wilk, who was presiding over the Callahan case. The result was an unusual emergency hearing presided over by both judges. Leonard Koerner, a lawyer for the city, argued that the Appellate Division had already found that the relevant state regulation, 18 NYCRR 352.35, was valid on its face and could now only be challenged on a case-by-case basis after the regulation was implemented. Only the state’s top court, the court of appeals, Koerner argued, could stop the implementation of the regulation. “You may be right,” Justice Wilk conceded, but decided “in the spirit of the season” to grant the plaintiffs’ request for a TRO delaying implementation of the regulation through January 14.
The city was outraged. Michael D. Hess, then the city’s corporation counsel, exclaimed, “The decision is an emotional one, not a legal one. They talked about the Christmas season. That’s not how you decide cases, based on what month it is or what temperature it is outside.”79 The administration appealed the granting of the TRO to the Appellate Division (First Department) of the state supreme court. But in March 2000 the Appellate Division denied the city’s appeal. Giuliani announced that it would appeal the Appellate Division’s decision but took no action for the last two years of his administration.
On June 26, 1996, Joan Malin stepped down as DHS commissioner. Her greatest success, she felt, was the not-for-profitization of the department’s services. Her greatest disappointment “was the Emergency Assistance Unit and the whole front end of the system .We [were] never able to figure out a more effective way of trying to help and work with families.” Relations with the courts had continued to be a difficult point throughout her tenure. According to Malin,
It was a highly tense relationship. I think Helen [Freedman], her heart was in the right place, attempting to do the right thing. . . . I think [I made] an effort to try and get around it or develop some kind of working relationship where there was some acknowledgment . . . of how much the city had done or could do and what we could not do and what . . . Legal Aid was asking of us.
We could go in with reams of data showing what we’ve done and yet Steve [Banks] could walk in with three or four . . . compelling stories that would break your heart and we would completely lose. There was like no way around it.
Relations with advocacy groups such as Coalition for the Homeless and Legal Aid also remained difficult: It’s still frustrating because I don’t think they wanted to appreciate how difficult it was and what stresses and strains we were under. I never felt like that they were a partner that understood and I felt I was as good as the last headline. But the relationships with the nonprofit organizations felt much more like an alliance.”
Apparently court relations, being necessarily adversarial, made for an adversarial relationship with the advocates, but relations with nonprofits, being contractual, were more along the lines of working agreements. As for managing under court supervision, Malin said,
There were some elements of it which you basically did not manage. You took what resources you had and responded to what was being asked of you as opposed to trying to think through a different or more creative or more effective way of doing it.
If you stepped back and actually looked at the homeless system in the City of New York, no one would plan it to look the way it did. It’s ridiculous. And yet we were sort of boxed into that because each increment had been mandated by different courts, at different points in the courts’ engagement. That really created a system that’s almost impossible to manage well.80
In July 1996, Gordon J. Campbell was appointed DHS commissioner. At the time Campbell was chief of staff to Peter J. Powers, Giuliani’s first deputy mayor. Campbell had been in city government since 1986, having worked for a while at the Human Resources Administration under Koch and for a short stint at the Department of Education, where he dealt with another challenging case of institutional reform litigation, Jose P. v. Board of Education. Before taking the DHS position, Campbell was asked by Thomas Crane, chief of the General Litigation Division of the Corporation Counsel’s Office, “Are you sure you want to do it because you’re going to be named in over seventy lawsuits?” However, Campbell was a lawyer and a former prosecutor who felt very comfortable with litigation.81
It turned out that Campbell had as many problems dealing with the City Council as he did dealing with the courts. In 1995 the council had extended the life of DHS until October 1996 with the requirement that the department discontinue the use of hotels with more than one hundred units and without kitchens in each unit. As the deadline approached, the department and the administration struggled to find ways to comply. At one point, Campbell argued to the City Council that the 1995 law was overridden by a judicial order that mandated the end of chronic overcrowding in the EAU. The “stunned” council did not agree and characterized the department’s continuing use of noncompliant facilities at the Kennedy Inn in Jamaica, Queens, as illegal.82
When the October deadline came and the Kennedy Inn was still being used, the city decided to move its residents to other hotels or Tier II shelters. The families protested. According to one press report,
Residents of a Jamaica hotel for homeless women and children blocked traffic briefly yesterday to protest the city’s plan to oust them from the premises by the end of the month.
Holding signs that read, “We won’t go,” several Kennedy Inn residents stood outside in the rain along Baisley Blvd. to call attention to the decision by the city’s Department of Homeless Services to discontinue use of the for-profit hotel. Marlene Barnes, thirty-one, mother of two sons, ages five and eleven, said that the Kennedy Inn has been her safe haven for the past sixteen months: “‘It makes me feel depressed. This place is nice,’ Barnes said. ‘We take GED classes, we have a church downstairs and a medical van.’”83
The department managed to achieve compliance by December 1996. Eventually the Kennedy Inn would be bought by Hampshire Hotels and Suites, which gutted the entire facility and reopened it as a luxury hotel servicing nearby Kennedy Airport.84
The department’s existence came up for renewal once again on June 30, 1998. The City Council continued to have concerns. Families continued to stay overnight in the EAU. Councilman Stephen DiBrienza, chairman of the council’s general welfare committee, which oversaw the department, wanted to require as a condition of making the department permanent that the EAU be equipped with cots and cribs for families waiting to be placed. Campbell’s argument that these accessories were unnecessary as waiting time in the EAU had been reduced to no more than twenty hours did not convince DiBrienza. Also of concern was the fact that ongoing privatization brought with it a reduction in the ranks of the department’s workers, as many of their jobs were now being performed by nonprofit staff. Thus agency staff, which had been 3,000 in 1994, had been reduced to 2,170 by the summer of 1998.85
On June 24, the council passed a bill to make DHS an independent agency. The vote was forty-one to six. But the bill included several conditions, and the mayor announced that he would veto it. Among the conditions were a requirement that beds, cribs, and self-contained, lockable sleeping rooms be made available in the EAU; a limitation on the number of beds in new adult shelters to two hundred; a provision that mandated submission of reports to the council on sanitation, fire, and health conditions; and more supervisory staff at certain shelters. Giuliani supported making the department permanent but rejected the conditions, saying, “What they tried to do is load it down with so many terms, conditions and burdens that they would have destroyed it.” He threatened to veto the bill, which he did on July 24.86 DHS then existed by executive order and thus completely under the mayor’s control.87
The council responded by passing a bill to impose the conditions Giuliani had objected to. The mayor vetoed that bill on December 7.88 Giuliani made much of the bill’s provision to limit new shelters to two hundred beds maximum, which he claimed would have to be applied retroactively to existing shelters of over two hundred beds, thus creating a need for up to twenty-five new shelters. These the mayor threatened to open in the districts of council members who might vote to override the veto. The council denied that the bill’s size requirements would be retroactive, and moved to include an amendment to emphasize that point. Giuliani conceded that an amendment would reduce to no more than five the needed new shelters, which he still promised to open in the districts of recalcitrant council members. Nonetheless, the council overrode the mayor’s veto on December 17 by a vote of thirty-six to eight and passed Local Law 57 of 1998, which retained the provisions objectionable to Giuliani.89 Besides limiting the size of shelters to two hundred beds, the bill also tried to address the issue of families staying overnight at the EAU, which was a continuing problem. The bill required that while families were waiting to have their eligibility for shelter determined, they had to be kept, not on an office floor but in a self-contained and lockable room with a bed or crib as appropriate. The bill also required the city to provide applying families with help in gathering the official documents that they needed to produce to get their applications approved.
At the passage of Local Law 57, the mayor made preparations to open a shelter in the district of his opposition’s leader, chairman of the General Welfare Committee, Stephen DiBrienza. When no other facilities turned out to be available in DiBrienza’s district, the city served eviction papers on a psychiatric center that had been serving hundreds of mentally ill people for twenty-five years. Eventually four other programs offered at the building would be threatened with eviction to make way for the shelter that was to punish DiBrienza.
The City Council would again make homeless policy with Local Law 019, passed on May 18, 1999. This was an attempt to deal with some of the consequences of the repeal of the “immediately” provision of 83 ADM-47. With the end of that requirement, Justice Freedman had found that the city could not be fined for allowing a family to wait in the EAU for twenty-four hours while an eligibility determination was made. To prevent DHS from doing so, Local Law 019 provided that “[a]ny family with children seeking shelter who is still in the process of applying as of ten o’clock in the evening on the day such family sought shelter shall be provided temporary shelter placement for that night.”
Why such furious opposition on the mayor’s part to the council’s initiatives, given that both sides supported the underlying objective of making DHS a permanent agency? Sources indicated that more important than the two-hundred-bed limitation were provisions for reporting to the council and regulating the activities of the EAU.90 The real debate was over who could control the department and what policy should be. Provisions to improve conditions in the EAU in effect put legislative teeth into court orders made by Justice Freedman and were thus seen as encroachments on mayoral power. Requirements to maintain staffing levels at shelters expressed skepticism about the ongoing privatization of the department’s services, and the reduced personnel needs it entailed.
Of course from the mayor’s point of view what needed explaining was the council’s insistence on involving itself in the management—or even micromanagement—of DHS. Martin Oesterreich, who would become the department’s commissioner in March 1999 after the interbranch warfare quieted down, believes, “It was designed to extract the maximum possible damage on the mayor.”91 During that period, Giuliani was widely thought to be contemplating a run for the U.S. Senate seat that would eventually be occupied by Hillary Clinton. Giuliani looked to be a formidable candidate who would be able to claim credit for the city’s improved economic climate and lower crime rate. A potential weakness of the mayor’s was his controversial efforts to reform the city’s social services. According to this theory, a Democratic City Council hoped to hurt the Republican mayor’s Senate chances by highlighting the shortcomings of his homelessness policy.
Eventually a compromise was reached. Plans to evict the community groups and develop a shelter in DiBrienza’s district were dropped. Legislation to make DHS independent of HRA was passed. The mayor agreed to provide job security for two thousand people at the department. And Martin Oesterreich, the commissioner of the Department of Youth and Community Development, emerged as the administration’s choice to head DHS.
Fortunately, given the stormy political environment that had just surrounded the department, Oesterreich turned out to be a conciliator. City Limits, a magazine that covered the city’s advocacy and service professions, described the new commissioner in an article entitled “My Favorite Martin”:
Shhh. The mayor’s newest commissioner, Department of Homeless Services boss Martin Oesterreich, is getting a reputation as an accessible, open, honest guy. In fact, one advocate worried that if the mayor hears how popular the guy is, he’ll get the axe. . . .
Says Coalition [for the Homeless] executive director Mary Brosnahan: “In contrast to [former commissioners] Joan Malin and Gordon Campbell, he doesn’t take things personally.”92
Oesterreich made a point of maintaining good relations with the court and Steven Banks:
I certainly think that Steve Banks was not happy to see me go because he got to trust me. I mean I never lied to the guy. If I said I would do something I did it. And if didn’t think I could do it I told him straight out.
And you know we tried to come to a mutually agreeable point on those issues. [I] understood very well that this was in some ways a money maker for Legal Aid Society and I don’t mean that from the fees, I mean that from the fact that . . . this was part of their overall mission, that [it] was part of their fund raising appeal.93
In other respects, Oesterreich was more like his predecessors. He was a manager, not an advocate or an expert: “I wasn’t brought in because of theory. I wasn’t brought in because of policy and stuff. I was brought in because . . . with twenty-some years of city experience I knew how to handle the internal city activities.” He also subscribed to the “underlying cause” account of homelessness, and to the belief in the heterogeneity of the population that had been articulated by the Cuomo Commission and institutionalized under earlier commissioners:
My greatest challenge was devoting myself to the fact that homelessness was the presenting condition but it wasn’t the underlying condition. . . . I think my greatest challenge was to try to explain to people that the homeless are not all alike. They are all alike in that they present as homeless. But the reasons for presenting are much different.
Steven Banks, asked to identify the best DHS commissioner he had worked with, would later say,
Marty Oesterreich. And it would have been against type because he was commissioner under Giuliani, and . . . one would have thought we would have a contentious relationship. Marty Oesterreich was about solving problems. He wasn’t about ideology, philosophy. He was about trying to solve problems. And he also understood our role in the litigation. Our role is to represent flesh and blood people who have problems. And sometimes that collides with what the administration wants to do or not do. And ultimately the issue is, is it legal and therefore they would win if they went to court? Or is it likely to be found unlawful and therefore we’re going to win if we go to court? Or, alternatively, is there some middle ground that is just going to be a better result? He was always very willing to listen. That doesn’t mean we didn’t have litigation. It doesn’t mean that there weren’t disagreements. But he was oriented toward problem solving. I think that’s what makes a great public servant . . . problem solving. As opposed to, “I’m right because we’re the government and therefore we get to form policy and we don’t have to consider the fact that it may have an impact on individuals that could be unlawful and therefore you can stop it.”94
During Oesterreich’s tenure the census in the shelter system rose above twenty-five thousand, higher than it had been since the late 1980s. This, despite the administration’s finally successful efforts to develop a strict eligibility-determination process. Oesterreich famously commented, “I can’t screw the front door any tighter,” a remark, he would ruefully acknowledge, that “was probably the thing that they are going to put on my fucking tombstone.”95
Other indications of the limits of the Giuliani overhaul of the shelter system began to present themselves. In particular, the program shelters that had been developed with so much effort turned out not to be effective in dealing with all clients. This problem became apparent to Mark Hurwitz, who began at DHS as an assistant commissioner with a particular interest in single adult clients. Hurwitz was a lawyer who had been the first director of the Urban Justice Center’s Mental Health Project, which helped patients released from psychiatric facilities make the transition from hospitalization to community living. Eventually he became concerned that the paternalistically oriented shelter system was not addressing the problem of the considerable number of clients who declined to participate in a rehabilitative regime of one of the program shelters. Hurwitz described the problem as follows:
The system had really been designed as a series of program shelters to meet the specific needs of individual types of clients. So there were employment shelters, there were substance abuse shelters, there were mental health shelters. And then, because of the Callahan consent decree, which required that the city give shelter to anyone, there were general shelters [for] people who didn’t want to go into a program.
So while I was assistant and deputy commissioner one of the things I realized was these program shelters were operated the same way that those providers operated their programs that were not shelters. They were residential treatment programs for people with addiction problems. They were mental health community residences. At the time those kinds of programs required you to, if you were there for substance abuse treatment, to be clean and sober and to be committed to sobriety. If there were a mental health program you had to have insight into your mental illness, be willing to take medication. And so the program shelters, rather than being designed to serve anyone who had a mental illness or anyone who had an addiction problem, they were designed to serve those who were most, in the words of the providers, were most amenable to treatment or who were likely to respond well to treatment. That created this problem of the people with the worst problems got stuck in the general shelters and never left. And so I began a push to require just the shelter providers to take anyone regardless of their willingness to accept treatment.
That was a big change just in the shelter system. And then that actually started causing pressure on the housing system because now these nonprofit providers that were running shelters were being expected to place people out into housing. And [the shelter providers] were saying, the housing providers are requiring six months of sobriety; who in the shelter system can stay clean and sober for six months? And they . . . don’t take anyone on methadone. There were all these restrictions.96
In other words, Hurwitz was beginning to realize the limitation of a system that required clients to accept treatment before they would be eligible for permanent housing. This was the same realization that Sam Tsemberis had come to in his operation of the Project Help street-outreach program back during the late Koch years. Eventually, Hurwitz became aware of Tsemberis, who had moved on to found Pathways to Housing, a provider of housing to street people that, as we saw, would become famous for developing the Housing First strategy.
Evidence supporting the Housing First model had continued to accumulate. In 1997 Pathways to Housing had become part of the New York Housing Study (NYHS), which was a federally funded experimental comparison of the outcomes for street-dwelling homeless people of the Pathways housing-first, treatment-(possibly)-later model of providing permanent housing and the then traditional practice of providing permanent housing only to subjects who were sober and complying with psychiatric treatment. After five years, 88 percent of clients who participated in the Housing First model provided by Pathways remained housed, compared to only 47 percent of those who participated in the traditional, treatment-first approach.97
By 1999, Hurwitz had become aware of Tsemberis’s success and interested in incorporating a Housing First philosophy into the city’s shelter system. According to Hurwitz,
I started educating the shelter providers and we actually invited Sam Tsemberis to one of the shelter director meetings. And he came. At the time we were using overhead projectors. He asked to have an overhead projector available. And he put one slide on the projector. And it was a diagram showing a box that was labeled “treatment” with an arrow to a box that’s labeled “housing.” This is the current system. If you want to get housing you have to first go to treatment and agree to treatment. Then he said we have this philosophy of Housing First and we see it a little differently. And then he proceeded to do a headstand and looked at the slide upside down. [He said] we think if you get into housing, if you give people housing first they are much more likely to get the treatment that they need.98
During the coming Bloomberg administration, Hurwitz would be promoted to deputy commissioner at DHS, where, as we shall see, he continued to push to incorporate the Housing First approach into city practice.
On April 22, 1999, Mayor Giuliani and Governor Pataki announced a second “New York/New York Agreement” to create an additional fifteen hundred supported housing units for the homeless mentally ill over five years. Capital costs were split, with the city putting up $85 million and the state $45.7 million, while the state agreed to cover all operating and service expenses.99 New York/New York II was a follow-up to the first New York/New York Agreement negotiated under Koch and signed in 1990 by Governor Mario Cuomo and Mayor Dinkins, but the second agreement was widely considered a disappointment. According to Shelly Nortz, the long-time Albany lobbyist for Coalition for the Homeless, advocates had been pushing for an agreement to produce ten thousand units of supported housing.100 More modestly, the Giuliani administration had been asking for twenty-five hundred units and committed the city to contributing $85 million in capital costs, which it asked the state to match. But for months Governor Pataki refused to commit more than $40 million.101 According to Nortz, during his first term Pataki “really didn’t have an interest in putting any additional resources in. . . . They just literally didn’t seem to comprehend the value of it. I think what happened is that the city just decided to take what they could get and move on.”102
Advocates for the homeless were greatly discouraged. Mary Brosnahan, the executive director of the Coalition for the Homeless, was quoted as saying that the agreement “falls far short of what is needed.”103 Eventually Shelly Nortz would be able to put the matter in perspective: “I wouldn’t say II was a failure. I would say it was a disappointment. And that we turned right around and said, not good enough, and then really brought out the troops for the protests.”104 The second agreement turned out not to be the end of the New York/New York process. A combination of advocate-organized protests, more research, a better understanding of the success of supportive housing, and shrewd political maneuvering by Pataki would result in the governor ultimately making a 180-degree turn and agreeing to a much larger and truly path-breaking New York/New York III Agreement before the end of his tenure in Albany.
During the Giuliani administration, the paternalistic moment of homelessness policy crystallized. The political demand that clients needed to “give something back” and take responsibility for their situation—a demand that expressed itself nationally at the federal level by the reform of welfare in 1996—was addressed. Better services were provided, system management improved, and shelter conditions got better. But the homelessness problem showed no sign of ending and would eventually rise to new heights. Developing a strategy that promised an eventual resolution of that crisis would fall to the Bloomberg administration. Policy still had plenty to learn.