NEW YORK, NY May 29, 2008 —The city's housing authority said that budget problems have been forcing it to put off capital projects that would modernize and improve public housing developments.

General Manager Douglas Apple told the City Council today that for the past eight years, the New York City Housing Authority has been using capital funds to cover day-to-day expenses.

APPLE: And if we were to continue to do that, I would be concerned in the day to day responsibility that we would have housing units that we would no longer be able to occupy because we do not have capital funds.

REPORTER: Analysis say using capital funds to cover operating expenses is a practice that led to the city's 1975 fiscal crisis.

The agency faces a $170 million deficit for this calendar year and has had to put off more than 100 capitol projects.