Three Mitchell-Lama housing developments overseen by the New York City Department of Housing Preservation and Development (HPD) operated at a financial loss, even as they gave bonuses and gratuities to staff and neglected critical building repairs, according to an audit released today by New York State Comptroller Thomas P. DiNapoli. Auditors examined Clinton Towers in Manhattan, Evergreen Gardens in the Bronx, and Tivoli Towers in Brooklyn, and found unsafe living conditions, including crumbling façades, mold, water damage, and broken fire doors, and identified more than $114,000 in bonuses, gratuities and holiday-related payments.
“Even in the face of New York City’s affordability crisis, my audit found troubling conditions and questionable spending at three housing developments that show clear need for better oversight of the Mitchell-Lama program, which is crucial to preserving affordable housing,” DiNapoli said. “The Department of Housing Preservation and Development must do more to ensure that these properties are managed responsibly and that tenant apartments are safe, well-maintained, and affordable.”
The Mitchell-Lama program provides affordable rental and cooperative housing to middle-income families. HPD oversees 92 Mitchell-Lama developments in the city with 46,787 apartments and is responsible for ensuring that managing agents keep buildings in good physical condition and that funds for the development are spent appropriately.
The audit covered the period from January 2019 through April 2025 and reviewed a total of 1,076 apartments across five buildings.
Unsafe Conditions Found (Photos in Audit)
Auditors found a range of unsafe and unsanitary conditions at all three developments and found that none of the managing agents submitted their required annual apartment inspection reports to HPD, limiting the agency’s ability to monitor tenant safety.
Clinton Towers (2 buildings, 397 units, Manhattan)
- Evidence of rodent infestation and droppings inside a day care center at the ground level of development.
- Water-damaged ceilings, missing tiles in lobby, and ongoing leaks in the garage.
- Courtyard closed for more than a decade, and community rooms cluttered and inaccessible.
Evergreen Gardens (2 buildings, 358 units, Bronx)
- Holes in the building foundation, detached benches, and debris posing tripping hazards.
- Broken fire doors that failed to self-close.
- Widespread water damage, peeling paint, cracks and mold in 22 of 35 apartments sampled.
Tivoli Towers (1 building, 321 units, Brooklyn)
- Damage to the building façade first identified in 2021. The agency says financing was secured in 2022 and repair work began prior to 2024, but the audit notes as of August 2024, facade work had yet to be completed.
- Inoperable fire doors on multiple floors, leaks and standing water in boiler and elevator rooms.
- Mold and peeling paint observed in occupied units, with reports of repeat flooding.
- Playground, courtyard, and community spaces closed off to tenants for years.
HPD said that delayed safety repairs at Clinton Towers and Tivoli Towers were due in part to contract payment issues and pending refinancing, noting recent capital funding awards to address façade and boiler work.
State Senator Brian Kavanagh, Chair of the Senate Housing Committee said, “Mitchell-Lama developments are meant to provide safe, stable homes for New Yorkers, and the conditions outlined in this audit underscore how important it is that these properties are properly maintained. When safety issues and deferred repairs persist, they directly affect residents’ quality of life and sense of security. I thank State Comptroller DiNapoli and his auditing team for bringing these findings forward, and I look forward to working with the new City administration, HPD, and my colleagues in government to ensure the issues identified are addressed and the long-term health of the Mitchell-Lama program is protected.
State Assemblymember Linda B. Rosenthal, Chair of the Assembly Housing Committee said, “The Mitchell-Lama program has long been a bastion of affordability for New Yorkers. However, State Comptroller DiNapoli’s most recent audit proves that without proper stewardship at the city level, these critical units are falling into an unforgivable state of disrepair – including Clinton Towers, a Mitchell-Lama rental located within my Assembly district. We must use every tool at our disposal to cut through the red tape that is smothering our existing affordable housing stock, which is why I have introduced legislation to strengthen HPD’s physical and financial oversight over its Mitchell-Lama developments. I thank the Comptroller for such a thorough audit and for shining a light on this critical issue. I look forward to advancing this much-needed legislation in partnership with the new Administration, as well as working with HPD to improve the conditions in Clinton Towers and other developments across the city.”
Manhattan Borough President Brad Hoylman-Sigal said, “I am extremely grateful to State Comptroller DiNapoli for exposing the shoddy oversight by HPD and the City of New York and an egregious pattern of neglect by Mitchell-Lama managing agents across the city. In Manhattan, tenants at Clinton Towers have had to endure rodent infestations, widespread leaks and water damage, and unaddressed repairs. New Yorkers deserve better from HPD and the managing agent of Clinton Towers. I look forward to working with the new City Administration to address these deplorable living conditions.”
Bronx Borough President Vanessa L. Gibson said, “At a time when New Yorkers are facing housing instability and an affordable housing crisis, it is unacceptable that families are being forced to live in unstable conditions. Based on State Comptroller DiNapoli’s audit, it is clear that stronger oversight and accountability are urgently needed to ensure that residents live in safe, well-maintained conditions and that affordable housing resources are managed responsibly. I commend State Comptroller DiNapoli for conducting an audit that brings these issues to the forefront and helps ensure that the appropriate parties are held accountable. New Yorkers deserve to live in a city with dignified, affordable housing options where they can raise their families in safe, healthy homes.”
State Senator Jose Serrano said, “Every New Yorker deserves a safe, well-maintained place to live. It is imperative that public funding is used responsibly to maintain buildings and ensure safe living conditions for all residents. As the Senator for the 29th Senate District, I support stronger oversight of the Mitchell-Lama program to guarantee that affordable housing remains a safe and dignified option for New Yorkers.”
State Senator Zellnor Myrie said, “Mitchell-Lama residents deserve safe, well-maintained and affordable apartments, but State Comptroller DiNapoli’s audits revealed significant oversight shortcomings and troubling maintenance issues. I’m grateful to his office for shining a spotlight on conditions at Tivoli Towers and other developments around the city, and I echo his call for HPD to implement new safeguards to ensure these buildings are managed responsibly on behalf of the New Yorkers who call them home.”
State Assemblymember Emérita Torres said, “Mitchell-Lama housing was created to guarantee safe, affordable housing for working families, not to tolerate neglect, mismanagement, or unsafe living conditions. This audit makes clear that residents were failed by a system that lacked proper oversight while allowing questionable spending to continue. We must strengthen oversight, enforce accountability, and prioritize residents’ health and safety to preserve Mitchell-Lama housing for the working families who rely on it.”
State Assemblymember Phara Souffrant Forrest said, “I am very grateful to the State Comptroller’s office for undertaking this detailed audit. I’ve known for years that Stellar Management is neglecting its obligations to the tenants at Tivoli Towers, and this investigation confirms that. I hope that HPD will take swift and corrective action to ensure that the residents of Tivoli Towers and other Mitchell-Lama developments under their control no longer experience such terrible conditions.”
New York City Council Member Gale A. Brewer said, “I am delighted that the State Comptroller has conducted an audit of three Mitchell-Lama buildings, and in particular, Clinton Towers. I have spent many hours trying to address the financial, utility, scaffolding, vacant apartments, board-related, management, and other issues in this building. I am in constant contact with HPD staff, management, and tenants. HPD has recently released funding so that the repairs on the roof and facade can be completed, but many other financial issues remain. The Mitchell-Lama program was the best housing program ever conceived of, and I hope that Clinton Towers can remain affordable for families into the future. But to do so, the problems must be addressed. Many other rental buildings in the program have unfortunately gone private and now include market-rate units.”
New York City Council Member Amanda Farías said, “I want to thank State Comptroller DiNapoli for this audit, which puts into writing what Mitchell-Lama residents in my district have been experiencing for years. When the Council passed my resolution requiring a minimum 60-day notice for rent increases, it was because families were being hit with sudden hikes while still living with unresolved safety and maintenance issues. This audit reinforces the need for stronger oversight, real accountability, and tenant protections that prioritize stability and safe living conditions. Mitchell-Lama must work for the residents it was created to serve.”
New York City Council Member Crystal Hudson said, “I am grateful to State Comptroller DiNapoli for conducting this audit and highlighting the longstanding challenges residents of Tivoli Towers have been experiencing for years. The Mitchell-Lama program was created to provide housing across New York State that is affordable to the middle class, yet the hardworking New Yorkers who call Tivoli Towers home (the only Mitchell-Lama rental development in my district), who provide some of the city’s most essential services, deserve better. Residents have long reported egregious living conditions, and the standard building services that Stellar Management is supposed to provide are nowhere to be seen. I hope this audit brings swift action by HPD that will ensure safe, livable conditions for all New Yorkers and protect the integrity of the Mitchell-Lama program.”
Financial Oversight Problems
The audit examined 564 financial transactions totaling nearly $3.9 million across the three developments and identified $163,862 in questionable or unsupported expenses, including over $114,000 in bonuses, gratuities and holiday-related payments, even as all three developments operated at a net loss for multiple years. All three developments also failed to notify HPD, as required, when payments to vendors exceeded $100,000. Evergreen Gardens contracted with five vendors totaling $3.9 million without evidence of competitive bidding or HPD approval.
Clinton Towers (Manhattan)
- Auditors reviewed 226 transactions, totaling $1.3 million from October 1, 2019 through September 30, 2024.
- The development spent $49,845 on expenses unrelated to normal operations, including $39,449 in bonuses for maintenance workers, porters, and the superintendent, as well as $4,500 in superintendent gratuities and $3,440 for holiday parties and decorations.
- It operated at net losses of $416,566 (2021), $412,474 (2022), and $216,894 (2023), while owing over $4 million in payables.
- The superintendent was reimbursed $9,551 for personal credit card purchases in violation of, HPD policy.
Evergreen Gardens (Bronx)
- Auditors reviewed 200 transactions, totaling $1.6 million from January 1, 2019 through December 31, 2024.
- Development had $33,956 in unsupported or unrelated expenses, including $10,250 in bonuses for maintenance staff, porters, and the superintendent and $1,500 in an unsupported settlement payment.
- It failed to provide invoices for $19,433 in transactions related to elevator and heating repairs.
Tivoli Towers (Brooklyn)
- Auditors reviewed 138 transactions, totaling $922,115 from July 1, 2019 through June 30, 2024.
- Spent $80,061 on unsupported or unrelated transactions, including $48,393 in bonuses and $5,400 in gratuities.
- Paid vendors without HPD approval or evidence of competitive bidding and had $207,496 in unpaid bills as of September 30, 2024, while operating at a net loss of $930,112 (2022).
HPD said staff bonuses are a “customary” industry practice and that a ban could lead to “staff attrition and negative impacts” for tenants. HPD also confirmed it lacked specific policies on bonuses and credit card use.
Vacant Affordable Housing Units
Auditors found that prolonged vacancies and unpaid rent further strained finances, estimating that Clinton Towers and Tivoli Towers lost a combined $327,514 in potential rental income from 24 vacant units, 15 of which were vacant for more than 120 days in 2024. Across all three developments, auditors found nearly $4 million in tenant arrears over the five-year audit period, including two tenants owing more than $180,000 each at Tivoli.
Clinton Towers (Manhattan)
- 8 vacant units as of December 12, 2024, with 5 vacant for more than 120 days.
- $670,110 of the total $992,380 in arrears was over 90 days late, as of November 20, 2024.
Evergreen Gardens (Bronx)
- $711,673 of the total $1,262,008 in arrears was over 120 days late, as of February 12, 2025.
Tivoli Towers (Brooklyn)
- 16 vacant units as of July 24, 2024, with 10 vacant for more than 120 days, including six that were left empty for over a year.
- $1.4 million of the approximate $1.8 million total in arrears was over 90 days late as of July 29, 2024.
Recommendations
DiNapoli’s audit included several recommendations for HPD to improve its monitoring of the three developments and ensure they are operating in a fiscally sound manner. These include HPD:
- Strengthen oversight to ensure managing agents maintain the developments in a manner that preserves the properties and protects the health and safety of their residents by ensuring annual inspections are conducted, reports are completed and deficiencies are corrected.
- Ensure that immediate corrective action is taken when hazardous conditions are found.
- Develop and implement policies and procedures for bonus and gratuity payments.
- Adequately review transactions for appropriateness of expenses and sufficiency of supporting documentation during annual reviews.
- Ensure contracts exceeding $100,000 are competitively bid and approved by HPD.
- Improve monitoring of vacant units and rent arrears, and ensure vacant units are promptly filled.
Though HPD disputed some of the findings, HPD agreed with many of the audit’s recommendations and noted that several improvements and financing efforts were already underway during the audit. The agency says it continues to monitor conditions and supports stronger oversight and faster repairs across the Mitchell-Lama portfolio. The agencies’ full response is available in the audit.
Audit
About the Office of the New York State Comptroller
The Office of the New York State Comptroller serves as the chief fiscal watchdog for the State of New York. Led by the State Comptroller, the office is responsible for protecting taxpayer dollars by uncovering waste, fraud, and abuse while providing independent oversight of State, New York City, and local government finances. It reviews State contracts and payments, maintains the State accounting system, administers the payroll, and offers technical assistance and training to local officials and school districts.
A central responsibility of the office is managing and safeguarding the New York State Common Retirement Fund, one of the largest and best-funded public pension systems in the nation. The Comptroller also administers the State retirement system, ensuring long-term financial security for public employees and retirees. In addition, the office plays a leading role in promoting transparency in government spending through public reporting tools and open financial data initiatives.
The Comptroller’s Office delivers direct benefits to New Yorkers by fighting public corruption and returning unclaimed funds to their rightful owners, distributing millions of dollars in lost money every day. It also supports important savings programs, including the 529 College Savings Program and NY ABLE accounts for individuals with disabilities. Through fiscal oversight, accountability, and public service, the office works to strengthen trust in government and protect the financial interests of all New Yorkers.
