Community Housing in the Spotlight

Pictured Above: This town-owned lot on South Ferry Road on Shelter Island could soon be a rental housing development, much needed for the island’s labor force. | Jeanne Merkel photo

As the new year kicks off, each of the five towns on the East End of Long Island is trying to figure out how to administer funds for community housing, which would be created if public referendums this November are approved by voters.

The Community Housing Funds, which would be paid for through a 1/2 percent real estate transfer tax administered in a similar fashion to the Community Preservation Fund, could be used for a wide variety of efforts to promote affordable home ownership and rentals on the East End.

Each town is currently tasked with recruiting members for seven to fifteen-member advisory boards to draft  housing plans in advance of the referendum.

Shelter Island Town has faced many of the same affordable housing pressures as the rest of the East End, exacerbated by the geographical and environmental challenges of being an island, with a severely limited supply of affordable housing, along with a limited supply of fresh water and an aquifer that is especially sensitive to the addition of new septic systems.

Shelter Island has its own five-member Community Housing Board, which is currently working on two affordable housing projects on two parcels of town-owned land, after which board members say they will have exhausted options for building affordable housing on town land.

Representatives of Shelter Island’s Community Housing Board urged the Shelter Island Town Board to quickly convene a new committee to draft a housing plan at the town board’s Dec. 5 work session.

The committee-drafted housing plan is a requirement of New York State law enabling the Community Housing Funds that was signed by Governor Kathy Hochul on Oct. 8 of this year.

“High housing costs have made it impossible for Island teachers, first responders and other community members to live on the island,” said Shelter Island Community Housing Board Chair Christopher DiOrio at the Dec. 5 work session. “We’ve seen it in roadway congestion and a trade parade. That definitely has a real bearing on what’s going on on Shelter Island. It’s difficult to measure the cost of this. People are coming from farther away to work here. There’s an added cost to doing business.”

Mr. DiOrio said his reading of the state law is that the advisory board required by the state would serve primarily to draft the housing plan, and would be separate from the Community Housing Board, which is working on an ongoing basis.

The state requires that the advisory board include representatives from the construction, real estate and banking industries, along with three representatives from housing advocacy or human services organizations. The members would need to be Shelter Island residents.

Mr. DiOrio said he envisions the current housing board would actively work with the town board to recruit members for the advisory board, and he sees the plan as being “based on smart growth principles.”

These principles include minimizing economic, social and environmental impacts, including the cost of infrastructure for new housing, including encouraging development in areas where infrastructure is already available, and building housing in locations that reduce reliance on automobiles.

Part of this effort, he said, would include the revitalization of the center of the island, where the school, post office, American Legion and IGA supermarket are located.

The state law, drafted by South Fork Assemblyman Fred Thiele, who drafted the original Community Preservation Fund legislation, allows Community Housing Funds to be used to provide financial assistance to first-time homebuyers for up to 50 percent of the purchase price, for the production of community housing for sale or rent, for the rehabilitation of existing buildings for community housing, housing counseling, and the acquisition of existing housing units to be used for sale or rent. The legislation could also be used to enter into public/private partnerships to provide housing opportunities and employee housing for local businesses.

Mr. DiOrio said tools and strategies being considered so far on Shelter Island include incentivizing accessory dwellings in existing neighborhoods and requiring an affordable component in new subdivisions and mixed-use developments.

Efforts already underway on Shelter Island include four houses to built on Manwaring Road, with the town retaining ownership of the land but selling the houses along with a long-term lease on the land. While homeowners would be able to build equity over time, that equity would be capped to keep the housing affordable in the long-term.

The town is also planning to create 16 rental units at 12 South Ferry Road, next door to the Shelter Island Historical Society’s Havens House, with a shared green space.

“We do these two projects, and we’re basically out of the land that we can build housing on. The Peconic Bay Region Community Housing Act just opens the door for more of this,” said Mr. DiOrio. “As time goes on, this is only going to become a more unaffordable place. This is a long-term problem that we are going to have to address.”

“Because this is a referendum, if we can fast-track these projects, that would be to our benefit,” said Community Housing Board member Maria Maggenti. “We are going to have to go and canvas people and say, please vote ‘yes’ on this referendum. We really want to commit ourselves to creating enough grassroots community support for what we really want to do.”

“In the near-shore areas, you are going to get into water issues,” said Councilman James Colligan. “If we’re looking for support, we have to come up with a carefully worded plan. We do have accessory buildings within the nearshore area, and people in those areas are extremely concerned about water, septic and saltwater intrusion, because it has impacted so many people, especially in the Silver Beach area.”

“We’re not going to be doing a project way out in Silver Beach,” said community housing advocate Virginia Gerardi. “We need more educational outreach to them on accessory units, a town informational packet to address ‘what does it take to put an accessory unit on our property.’”

“Accessory dwellings aren’t allowed in nearshore districts,” said Town Supervisor Gerry Siller. “Instead of the NIMBY (Not in My Backyard), let’s go with the YIMBY (Yes in My Backyard). What can you do in your area to help us?”

“The Senate and Assembly passed this bill three years ago, and the governor (Cuomo) vetoed it,” he added. “Had it passed three years ago, the five East End towns alredy would have $30 million in the bank toward housing. We missed out at a time when this would really have been to our benefit. Going forward, we’re going to do everything we can to get this passed.”

If approved by voters at November’s referendum, there would be several changes to both the Community Housing Fund and the Community Preservation Fund to ensure that neither fund places a burden on people looking for an affordable home.

The first $400,000 of the sales price would be exempt from both the Community Preservation Fund and Community Housing Fund taxes in Southampton, East Hampton and Shelter Island towns, while the first $200,000 of the sale price would be exempt from the taxes in Riverhead and Southold towns. This exemption would only apply to transactions of $2 million or less, ensuring that people who are buying luxury homes pay more in to the fund. 

Mr. Thiele’s office has calculated that people will pay less than they are paying now into the Community Preservation Fund for transfers under $1 million on the South Fork and on Shelter Island, and for transfers of $400,000 or less on the North Fork and in Riverhead.

There would still be an exemption for first-time homebuyers, as is the case with the existing Community Preservation Fund, but the purchase price limit for that exemption in the towns of East Hampton, Southampton and Shelter Island would be increased from 120 percent to 150 percent of the purchase price limit defined by the State of New York Mortgage Agency.  — BHY