Despite boasting that the migrant crisis is abating, The Post has learned that the Adams administration has signed a nearly $1 billion no-bid contract with the hotel industry for emergency shelter space.
Since there are still 86,000 homeless and asylum-seeking people in the city, taxpayers are responsible for paying the $929.1 million reupped with the Hotel Association of New York City Foundation.
In a notice published Wednesday, the Department of Homeless Services stated that social services vendors would use these hotel units to house emergency shelter clients who have entered the [Department of Homeless Services] shelter system.
The renewed agreement is valid through June 30, 2026, and went into effect in January. It was given away through “negotiated acquisition,” which excludes competitive bidding. Negotiations for the original contract continued until the end of 2025.
According to Nicole Gelinas, senior fellow at the Manhattan Institute, the move is perplexing.
“Why do we need to be using so many hotels for day to day homeless management?,” Gelinas stated. “This is turning an emergency program into a permanent program and taking a block of hotel rooms off the tourist market while people complain the city’s hotel room costs are so high.”
Instead of treating the hospitality sector “as a monopoly” with a sole source contract, Gelinas argued the city ought to have forced hotels to bid against one another.
According to the new agreement, the Hotel Association will act as the program’s “fiscal agent” and link the city with lodging establishments that are prepared to reserve rooms for homeless people and families in return for rental fees.
According to city officials last year, the total cost of housing migrants per night is $352, which includes $130 for hotel room rentals. According to its CEO, the association charges a “nominal fee” for administrative costs.
“This agreement is an extension of the non-profit HANYC foundation’s ongoing work since COVID to connect city funding with hotels to address New York’s need to provide emergency services to the homeless,” Hotel Association CEO Vijay Dandapani stated.
“The foundation began providing this service five years ago pro-bono and only takes a nominal fee for limited administrative expenses in order to ensure taxpayer money is spent efficiently.”
The city’s spending on these services “has declined steadily over the last two years,” according to Dandapani, who also stated that the $929.1 million is the maximum amount permitted but not assured to be spent under the contract.
The agreement coincides with the trade association’s efforts to persuade local legislators to lower the tourist hotel occupancy tax from 6% to 3%.
In order to help stop the spread of the deadly virus, the city started depending more on hotels for emergency housing and shelter during the COVID-19 pandemic.
This trend significantly increased during the height of the migrant crisis, when 4,000 asylum seekers descended on the Big Apple every week.
Using the argument that the Big Apple is still dealing with a high shelter population in comparison to the pre-pandemic year 2019, when there were 61,415 people in shelters, the Adams administration defended extending the emergency contract with hotels.
In January 2024, the number reached 140,134, a startling 127% increase from the previous two years, according to a report released by state Comptroller Tom DiNapoli.
Read Also: Texas High School Graduate Killed in 50-Foot Waterfall Plunge at Olympic National Park
According to sources, the city is required to offer emergency shelter to anyone in need under New York’s right to shelter policy.
Since the crisis started in 2022, the city said it has now spent $3.12 billion on shelter and associated expenses, such as hotel room rentals, to house migrants.
“As the city’s shelter system was pushed to its limits following an influx of new arrivals, the Adams administration acted quickly and decisively to effectively address the crisis and acquire emergency shelter capacity to serve households in need,” a Department of Social Services/Homeless Services spokesman stated.
“While the administration’s whole-of-government response to the crisis has significantly reduced the number of households living in shelter, the total shelter census still far exceeds pre-pandemic highs.”
During the height of the migrant crisis, which began amid an influx at the southern border during the administration of former President Joe Biden, 150 hotels spread across the five boroughs provided tens of thousands of rooms for migrants.
A prominent representation of the city’s difficulties coping with the migration wave was the historic Roosevelt Hotel in Midtown Manhattan. Roosevelt served as an intake center close to popular tourist destinations and in a busy commuter area, while “tent cities” with problems like crime appeared in other parts of the five boroughs.
Read Also: New State Dept. Policy Adds Social Media Review to Student Visa Process
However, in recent months, Mayor Eric Adams declared that the city’s biggest emergency shelters, such as the enormous tent encampments at Floyd Bennett Field and Randall’s Island, would be phased out and closed.
As the number of new arrivals fell and some asylum seekers were relocated outside of the Big Apple, the closure announcements were made.
The slowing influx into the city has been further exacerbated by President Trump’s hardline stance on illegal immigration and the border crackdown he implemented upon his return to office in January.
With increased enforcement, the number of illegal border crossings has decreased from a peak of 4,000 per week to just a few hundred.
Several hotels in Times Square, the area surrounding John F. Kennedy Airport, and LaGuardia Airport were among the dozens of local establishments that were gradually converted back to serving as tourist accommodations after serving as migrant shelters.
Mayor Adams and the president are at odds over the contentious decision to pay hotels to house migrants.
In February, the Trump administration withdrew $80.5 million in federal funding that had been sent to the city after Elon Musk and the Department of Government Efficiency determined that the funds were being squandered on “luxury hotels” that housed illegal immigrants.
Brad Lander, the city comptroller, found that the money, which had been authorized by both Congress and former President Joe Biden, had been removed from its accounts.
Adams claimed the space was “luxury” and filed a federal lawsuit against Trump to recover the $80.5 million.
The city received a reimbursement of $12.50 per night for each hotel room as part of the federal funding. The claim that migrants were receiving opulent lodging was refuted by city officials.
