More than 35 East End leaders and organizations have signed a letter urging New York Gov. Kathy Hochul to approve legislation that would establish a community housing fund for the Peconic Bay area.
The bill, which former Governor Andrew Cuomo had vetoed, would allow the region’s five cities to hold mandatory referendums on the creation of the fund. If passed, the new fund would add half a percent to the current 2% Community Preservation Fund tax on real estate transactions in these towns.
The September 28 letter noted that the area’s lack of affordable housing “has reached crisis proportions” as local businesses struggle to hire and retain employees. Volunteer emergency services are also struggling to retain recruits and local families are leaving the area, he said. The need to import labor has also increased traffic congestion and the lack of housing “often translates into unsanitary and illegal housing conditions”.
“The Peconic Bay area is experiencing one of the most serious affordable housing shortages in the state,” the letter said. “The lack of housing opportunities has a negative impact on the local economy and the quality of life in the region.
He attributes the housing crisis to the high real estate costs which have further skyrocketed during the COVID-19 pandemic with the flight of urban residents to the East End, contributing to the current status of the Peconic Bay area as “one of the state’s most expensive housing markets. . ”
“The only way to create housing is to find sources of income to offset the costs for the developers and it is certainly a source of income that we badly need,” Southold Town supervisor Scott Russell told the Times Review. “However, you have to stop and consider: how much tax can you apply on the transfer of housing?”
Mr Russell, who signed the letter to the governor, suggested that the housing fund could be used to reduce the cost of acquiring land for private developers or provide grants on a unit basis to offset construction costs, among others.
Riverhead Town supervisor Yvette Aguiar, who supports the bill and plans to sign the letter, said Riverhead has “been very responsible for providing affordable housing to its residents,” with over 2,000 affordable units. She pointed to a recent study which found that the city has enough affordable rental units and, in fact, needs a better balance with market-priced units.
“Other towns in the East End are in desperate need of affordable rental housing – which is why they have the trade parade traffic jam every morning. However, Riverhead is not in the same position; what we need in Riverhead is a way to get people out of tenancy and put themselves in a position of equity – to buy condos or houses, ”Ms. Aguiar said via email.
She added that she was inclined to offer to use the funds raised under the tax initiative to provide first-time homebuyers with down payment assistance and to provide low-rate loans. Interest or no interest to first-time home buyers in the historic Riverhead district, which would hopefully encourage historic remodeling.
Before holding the required referendum, every city in the East End would have to adopt a plan demonstrating how the fund would produce affordable housing in that community.
The legislation would also increase existing tax exemptions on improved properties, reducing the existing real estate transfer tax on transactions of $ 1 million or less on South Fork and Shelter Island, and $ 400,000 or less on North Fork. A press release from Assembly Member Fred Thiele (I-Sag Harbor) estimates he would cut property transfer taxes for nearly a third of all real estate transactions in the area.
The Long Island Association and the Long Island Builders Institute both approved the legislation in separate letters of support to the governor.