Making yourself at home – New York style

New York City. Three words that conjure a thousand images. From the jagged Manhattan skyline to the brownstones of Brooklyn, the rollerbladers of Central Park to the pulsating energy of the Bronx and Harlem – it is a real city, one blessed with a rich, textured history and culture, and a place that lays justifiable claim to the title, “capital of the world”.

It is also a city that has had its share of notable leaders. Robert Moses and Mayors La Guardia, Giuliani and Bloomberg all spring to mind. The last, in particular, made quite the impact. His 12 years in City Hall witnessed fundamental changes, ranging from transformed waterfronts to new parks and reformed policing and education systems. His allure was also enough to persuade John Rhea to switch from a career in investment banking and consultancy to head up the New York City Housing Authority (NYCHA) and, in the process, forsake a potential high-profile job in the Obama Administration.

I made a choice to go work for Mayor Bloomberg,” he recalls. “One of the reasons I hadn’t gone into government service before was because I wasn’t convinced that the leadership was prepared to take risks and be held accountable. I was attracted to his management style, including his willingness to stand up and say the buck stopped with him, as well as his willingness to be innovative in pushing to achieve better outcomes for New Yorkers.”

Making housing into homes

New York, for all its myriad strengths, is not without its challenges. A prime example is the cost of its housing. Like many other major cities around the world, prices and rents have surged in recent years, making affordability a key issue on the political and social agenda. Rhea, as chairman and CEO of the NYCHA, was tasked with keeping a lid on these rises, as well as addressing deep financing shortfalls (including a $50 million operating deficit) and repairing decades-old apartment buildings. Quite an in-tray for a seasoned veteran, let alone a 46-year-old with no prior knowledge of the housing industry.

But actually, Rhea believes that his lack of government experience was more help than hindrance. Mayor Bloomberg had had quite a bit of success taking people from a range of backgrounds and importing them into government and employing them to make change happen,” he points out. “And I think that one of the reasons he recruited me was he was looking for a financial expert with a fresh pair of eyes and an external perspective. Part of it was the use of private sector tools, but it was more about bringing a mindset of performance and outcomes to the table, as opposed to just strictly process.”

The NYCHA is responsible for providing rental accommodation for about 650,000 New Yorkers. This takes place via hundreds of public housing developments across the city’s five boroughs, as well as subsidised rental assistance in private homes. So, in a manner of speaking, Rhea was the largest residential landlord in the US. Did he feel the personal pressure to ensure these people had a roof over their heads?

“On one hand you can refer to it as ‘pressure’, but I would say that I felt this immense ‘responsibility’,” he reflects. “I had a real keen sense that I was being entrusted with something that generations of people have fought for – making public housing a reality and having the ability to provide quality, safe, affordable housing to everyday Americans. I had a keen sense of historical perspective and that there was a baton which had been passed across generations. This meant I had a responsibility to do my part in stemming the tide of what I referred to as ‘benign neglect’, and preserving and advancing these communities. So you could call it ‘pressure’, but actually I saw it more as ‘inspiration’.”

Getting things done

Rhea, who was appointed in 2009, served in the role for almost five years. Looking back, a high point was securing federal stimulus money to cover the operating costs of 21 financially insolvent developments – surprising observers in doing so – as well as pulling in new private funding and boosting income from the NYHCA’s commercial portfolio. Rhea also formed numerous public-private partnerships to support low-income residents, including innovative workforce training programmes and building two high-performance charter schools within NYCHA developments. But he’d be the first to admit that he encountered many bruising battles along the way.

“The one thing that I’d like to have known before starting work there is that no matter what you do there will be a group of people you’re going to offend by doing your job – particularly if you are effective,” he reflects. “And by about the 24-month mark, the opposition will be organised to resist anything you propose, even if it is what they told you they wanted.”

He also admits to a misconception about the impact of early momentum and quick wins. Expecting this to be a positive, he found that – on the contrary – it merely emboldened the resistance. “I had a sense we needed to move fast,” he explains. “I worked for a boss that wanted action and outcomes. I also had a sense that – like anything else – it is important to strike while the iron is hot. But what I learned is that wins threaten people, because it signals you have the capacity to make change happen. The biggest opposition to improving performance and serving people better is the status quo. I didn’t appreciate this at the time.”

That said, he agrees with the suggestion that change is easier to achieve at the local level. The close proximity to the day-to-day needs of service users, as well as the reduced partisanship when compared to national policymaking, means that it is easier to get things moving. “To paraphrase former Mayor Fiorello LaGuardia, there is no ideology when it comes to collecting the garbage,” he points out.

“When Mayor Bloomberg offered me the job, he first offered me the commissioner of finance role, which I politely declined because I was looking for an opportunity to impact people and not be a banker in a public context. He knew I was in discussions about moving to Washington, but he told me if I did so I’d end up being highly frustrated because of the partisanship and the fact that I’d walk into a large bureaucracy where it would be very hard to get things done. The action, he said, was at the local level – and he was absolutely right.”

Bloomberg’s mystic skills extended to his approach as a leader – demanding yet fair, outcome-driven yet understanding the ups and downs of policy delivery. “I found him to be exactly as advertised,” says Rhea. “Super-smart, super-focused on data and results, and willing to provide the resources needed, but also holding me to the timeline and insistent on regular updates and opportunities for course correction, if needed. If something went wrong, he wanted to learn from it so that mistakes wouldn’t be repeated. It was a style I was comfortable with and understood. He would always tell us ‘let me worry about the politics – you just do the right thing’.”

Leading by example

There’s no doubt that Bloomberg – who is one of the very few to master the worlds of both business and government – possesses many of the necessary traits to be an effective leader. Asked to define what makes a strong leader, Rhea says that context is all-important. “I was asked to be an agent of change or an insurgent,” he points out. “So, what it takes to be effective in that role is different to what it takes if you inherit a smooth-running and successful operation.”

He goes on to pinpoint two aspects of his time at NYCHA that enabled him to drive the disruptive change that Bloomberg – and New Yorkers – were seeking. “I realised that I needed to win the hearts and minds of the people who worked for me,” he says. “I had to remind the people who worked for me of the incredible mission of the agency and the fact that there is nobility and dignity in public service. I reminded them that no matter the external criticism, they should be proud of what they did. I think that through this, people began to stick their chests out and be on the front foot and not let negative things define them.”

In addition to instilling a sense of pride in the workforce and getting their fire burning, Rhea says that a leader has to be willing to stand up and take the slings and arrows. “I knew we had a big change agenda and people would resist it,” he points out. “But if we stayed the course, we could make it impossible for the critics to dismantle it. I knew I wouldn’t get the public credit for this, but the work would speak for itself over time.”

Rhea, who is now juggling a portfolio career back in the private sector, looks back on his time at the NYCHA with a mixture of pride and satisfaction. “In somewhere like New York there is always more to do, but we did make a real impact through a mixture of perseverance and hard work. And as I kept telling the workforce, they should be proud of what they do. There is no public housing in the world that works better than in New York City.”

 

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