Town Supports Idea Of New East End Affordable Housing Fund: Supe

SOUTHOLD, NY — With desperately needed affordable housing a critical issue on the North Fork, Southold Town Supervisor Scott Russell said on Friday that he and the town board support the concept of a proposed East End Town Community Housing Fund, which would finance affordable housing opportunities through a 0.5% increase in the real estate transfer tax.

The legislation was introduced in late January by New York State Assemblyman Fred Thiele and would authorize the towns of Southold, East Hampton, Riverhead, Shelter Island, and Southampton to establish the Town Community Housing Fund.

Town Community Housing Funds would be financed by a 0.5% addition to the existing 2% real estate transfer tax that finances the Community Preservation Fund.

Russell said in an interview Friday that he and the town board were ready to explore the idea. "The board and I support the concept and will seek to get input from the public and the town's affordable housing committee," he said. "Since the legislation hasn’t been adopted by the state yet, we are reviewing it and I will meet with our state legislators to discuss language that would address Southold’s particular needs. But, we are committed to having a referendum and getting the support of the public to help address the critical need for affordable housing."

Russell added: "We would be particularly interested in advancing our goals of creating affordable apartments and funding the use of alternative treatment systems — but look to lower the cap on the purchase price of a home to a more realistic standard. The current limit proposed is completely out of proportion with the concept of affordable housing in Southold. These, among other issues, will be part of the discussion with our state representatives."

The state legislation is an authorization; the decision to create such a fund would be a home rule decision by the town boards, subject to a mandatory referendum, Thiele said.

Under the proposed legislation, the Community Housing Fund could be used to provide financial assistance to first-time homebuyers not to exceed 50% of the purchase price; the production of community housing for sale; the production of community housing for rent; rehabilitation of existing buildings for community housing; housing counseling; and education impact payments to local school districts.

In addition, the legislation would increase the exemption on the transfer tax for improved property from $250,000 to $350,000 in the Towns of East Hampton, Southampton, and Shelter Island to provide more relief to affordable housing purchasers. The exemption would increase from $150,000 to $250,000 in Southold and Riverhead. The exemption would only apply to transfers of $2 million or less.

Towns would have to adopt a Community Housing Plan before the fund could be implemented, and that plan would have to include a regional housing strategy agreed upon by all five East End towns. At least 20% of the funds would be required to be utilized for this regional housing strategy, Thiele said.

In addition, each town would also be required to appoint a community housing advisory board to advise the town board on the creation and implementation of the Community Housing Plan, Thiele said.

Based on 2017 revenues, the proposal would generate $22.7 million for community housing across the five East End Towns, with at least 20% or about $4.5 million utilized for regional housing initiatives, Thiele said.

Income eligibility for community housing would be $140,040 for a one or two person household. The purchase price limit would be $938,649 for a one-family home. The numbers, Thiele said, are based upon SONYMA eligibility low interest loan requirements for Suffolk County.

"The lack of affordable housing has reached crisis proportions. Local employers have difficulty hiring and retaining employees because of housing costs and availability. Local volunteer emergency services are experiencing difficulty in recruitment and retention," Thiele said. "Long-time residents are forced to leave the area. Traffic congestion is intensified by the importation of labor from areas with lower housing costs. There is no one solution to this problem. However, this legislation will provide towns with a meaningful tool that can make a difference by providing housing opportunities for its residents at a much greater rate than they can with existing resources and programs."

However, he added: "Ultimately, it will be the voters who will get to decide."

The legislation will go to the Assembly Local Governments Committee for consideration, which Thiele chairs.

Reflecting on the legislation, Thiele said is represents a 12-month effort to meet with local housing stakeholders and develop the best possible legislation; a study bill was introduced in 2018.

"The legislation I have introduced for 2019 is substantially better and more comprehensive because of the input of local government, the real estate industry, housing advocates, and civic leaders across the East End. While I expect further refinements as we move through the legislative process, the bill I introduce today is a thoughtful and well-crafted proposal," Thiele said.