Both houses of the New York State legislature have passed bills pushed by Assemblyman Fred W. Thiele Jr. of Sag Harbor with the help of Senator Kenneth P. LaValle of Port Jefferson to allow the five East End towns to establish community housing funds to support affordable housing. The bill has yet to be signed into law by Governor Andrew Cuomo.
The funds would be financed by a .5-percent tax on real estate sales in addition to the 2-percent tax now imposed on sales to support the East End towns’ individual Community Preservation Funds (CPF).
Based on 2017 real estate sales, the housing tax would generate about $20 million for community housing initiatives across the East End towns.
Under the legislation, which by midweek had not yet been signed by Governor Cuomo, it would be up to each town board to decide whether or not voters should be asked to approve the funding mechanism in a binding referendum.
The revenue could be used to assist first-time homebuyers; build community housing for sale or rent; provide financial assistance as part of a public/private partnership including employee housing; rehabilitate existing buildings for community housing; and providing housing counseling.
Mr. Thiele first proposed a community housing fund in 2018 when he introduced a study bill in the Assembly. He said this week he introduced this year’s version of the bill after exploring the concept with local government officials, people in the real estate industry, housing advocates and East End civic leaders.
“The lack of affordable housing has reached crisis proportions,” Mr. Thiele said. Local employers have difficulty hiring and retaining employees because of housing costs and availability. Local emergency services are experiencing difficulty in recruitment and retention. Long-time residents are forced to leave the area, Traffic congestion is intensified by the importation of labor from areas with lower housing costs.”
He added that “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.
An CPF tax exemption currently in place on lower-priced properties would be increased for the housing fund tax, from $250,000 to $400,000 in the towns of East Hampton, Shelter Island and Southampton and from $150,000 to $280,000 in Riverhead and Southold.
Before implementing a housing fund, each town will be required to adopt a community housing plan and appoint a community housing advisory board.