News from
FIT’s offer of free temporary housing
to laid-off workers isn’t actually free
BY GABRIEL SANDOVAL
THE CITY
An offer of temporary “free” housing
brought a sigh of relief to 13 dorm
workers late last month after they
learned they would lose their jobs, health
insurance and homes in the residence halls
of the public Fashion Institute of Technology
in Manhattan.
But the workers, some of whom are losing
jobs that paid less than $17,000 a year,
have since grown disillusioned after discovering
the school administration wouldn’t be
delivering free housing after all.
That’s because the Chelsea living space
offered to the soon-to-be unemployed New
Yorkers would be booked as a form of taxable
income, leaving them liable for taxes
on units with rents ranging from about
$2,600 to $4,800 a month.
FIT administrators sent the workers individual
housing agreements and gave them
until Nov. 11 to review, sign and return
them. Their deadline later got bumped to
Monday.
“Unfortunately, we feel like we have no
choice but to sign the damn paper — because
where else are we going to go?” said
a worker who requested anonymity out of
fear of retribution from the State University
of New York school administration.
A FIT spokesperson maintained that
the housing is “free of charge and similar
to what they had previously,” and includes
electricity, heat, water, Wi-Fi and trash
services.
“In any instance, FIT is required by law
to report the value of these rooms along
with the other services provided to a nonemployee,
to the IRS,” said the spokesperson,
Beth Mitchell. “The recipients also
have an obligation to report these benefi ts
to the IRS.”
But since their employment has changed,
so has their housing benefi t, she said.
“Housing was not recorded previously
as income because these individuals were
required to live on campus as part of their
employment, which is no longer the situation,”
Mitchell continued.
‘Scared and Frustrated’
Among the 13 laid off are part-time and
full-time workers, FIT alumni, parents of
young children and a campus Residential
Life veteran with more than 20 years on
the job.
FIT’s Kaufman Hall on West 31st Street, Oct. 21, 2020. PHOTO: BEN FRACTENBERG/THE CITY
Workers told THE CITY that at least one
person is going to decline the offer, regardless
of any potential last-minute changes. The
rest have yet to decide what they’ll do when
the deadline comes Monday, they said.
“I’m scared and frustrated and incredibly
overwhelmed,” another worker said.
“It feels like we’re being forced into taking
this contract and we’re not able to get all
the answers that we need.”
Puzzled by multiple provisions in the
“Separation Agreement and Release,” the
workers have been frantically emailing
questions to a FIT administrator in the
human resources department, but still have
several inquiries outstanding.
The workers have asked how accepting
the housing offer would affect their ability
to receive state unemployment insurance.
And their requests to meet virtually with
FIT administrators have been turned down.
“There is a consensus that the terms
reached refl ect the best possible offer that
can be extended,” Cynthia Glass, FIT’s vice
president for human resources, wrote to
workers last Wednesday in an email obtained
by THE CITY. “It is for that reason
that the administration believes that further
discussions would not be productive.”
The layoffs come as the number of students
living on campus has plummeted due
to the pandemic, leading to roughly $32
million in lost revenue.
On Wednesday, the state Public Authorities
Control Board will vote on a plan for
the state Dormitory Authority to refi nance
$39 million in FIT residence hall debt to
make payments more manageable.
Meanwhile, FIT President Joyce Brown
resides in a full-fl oor penthouse in one of
the campus’ four residence halls in Chelsea,
fulfi lling a contractual obligation. She pays
no rent but is obligated to pay taxes on the
value of the benefi t.
Missing the Market
The workers said they never paid taxes
on their housing, which was provided for
free as part of their compensation package,
they said.
Double apartments are designated for
the laid-off part-timers, valued at $2,590 a
month. Quad apartments, valued at $4,782
a month, have been earmarked for laid off
full-timers.
If a full-time laid off worker accepts the
housing offer and stays until the end of
May, for example, they will accrue $28,692
in income. The worker will need to report
the housing as income when they fi le their
taxes next year and in 2022. The amount
of taxes that the worker will owe depends
ultimately on how much they earned in
those years.
Workers question the “market rate” of
the FIT housing, suspecting it should cost
less because of the pandemic’s impact on
Manhattan real estate.
The real estate fi rm Douglas Elliman’s
latest monthly report showed earlier this
week that market rents in Manhattan continued
to plunge into October.
One employee emailed Glass on Wednesday,
asserting that the rate quoted is “much
higher” than what can be found for the area
in online searches.
Mitchell said that “the housing agreement
that has been developed is consistent
with the offi cial rental rates for student
housing at FIT.”
One full-time worker expressed disgust
at FIT’s treatment of employees who
dedicated their professional lives to helping
students overnight, on weekends and
holidays.
“I’m hurt more than anything by this
organization that I love so much,” the
worker said.
This story was fi rst published on Nov.
15, 2020 by THE CITY, an independent,
nonprofi t news outlet dedicated to hardhitting
reporting that serves the people of
New York.
Schneps Media November 19, 2020 3