East Hampton Town’s Community Housing Advisory Board has recommended the town fund five of the seven projects that applied this year in the first-ever round of requests for proposals for funding through the town’s new Community Housing Fund (CHF).
Pictured Above: The Green at Gardiner’s Point, under construction earlier this year.
If the Town Board approves the total of just over $3.68 million in funding after upcoming public hearings on the proposals to be held Dec. 19, a large portion of the money would go to projects that have already been built and are either in need of rehabilitation or facing budget shortfalls due to inflation in recent years, Director of Housing & Community Development Eric Schantz told the Town Board at its Dec. 3 work session.
CHAB Chairman Andrew Garvey added that, after going through the first year’s applications, the CHAB has realized that its preferences going forward will be to fund high-impact projects that create the greatest number of housing units, and that the board would prefer to spend the money on construction than on soft costs like permitting and architectural plans, and would prefer to provide loans than grants, to “be able to recycle funds back into affordable housing projects, which compounds the power of CHF dollars.”
The town currently has about $10 million in its CHF fund, said Mr. Schantz, some of which is earmarked for the town’s down payment assistance and accessory dwelling unit programs rolled out this past spring.
The proposals recommended for approval include a $1.5 million grant for the East Hampton Housing Authority’s proposed middle income housing development on Route 114, a $345,000 grant for renovation of Whalebone Apartments, a $1 million grant for the new complex on Three Mile Harbor Road known as The Green at Gardiner’s Point, a $500,000 grant to the Housing Authority to revamp The Cottages, an aging collection of small homes adjacent to the proposed Route 114 complex, which it is purchasing from the Sag Harbor Community Housing Trust, and a $338,000 loan to add 20 units to the Windmill Village 1 senior housing complex on Accabonac Road.
The Community Housing Advisory Board (CHAB) recommended the town not fund an employee apartment at the St. Michael’s Senior Housing complex in Amagansett ($34,275) and to not provide $350,000 for the Whalebone Workforce Housing proposal, which would not have any income restrictions for the residents, which is a key element of CHF funding.
Mr. Schantz said the funding for the new Route 114 project, which is slated to include 50 rental units with 1 to 3 bedrooms, will be contingent on having 75 percent of the units earmarked for middle income residents making up to 130 percent of Area Median Income, which in 2024 in Nassau and Suffolk counties was $142,150 per year for a family of one and $203,050 for a family of four. The town has identified housing for people in this income range as a great need here, but it is difficult to get federal and state grant funding for this income range, as those programs are usually expected to be for residents earning about 60 percent of Area Median Income.
“Right now, the Housing Authority has only one middle income project, and a very lengthy waiting list,” said Town Supervisor Kathee Burke-Gonzalez. “This project was always designed to be middle income.”
“That is a need out here that hasn’t been met by state or federal funding,” agreed Councilman Ian Calder-Piadmonte, who serves as the Town Board liaison to the CHAB.
Mr. Schantz said the Housing Authority had requested a total of $7.5 million for the project over the next three years, but the CHAB recommends that it apply for each year’s funding individually.
Whalebone Apartments is a privately managed 46-unit housing complex for low-to-moderate income residents that was built on Boatheader’s Lane in 1989 and has 300 people on its waiting list, said Mr. Schantz. The complex is looking to use the money for design work for its plan to upgrade kitchens, bathrooms and flooring and make energy efficiency upgrades including conversion to electric building utilities and solar panels.
Town Board member Tom Flight said he feels “this money isn’t delivering more housing, and I don’t think CHAB should be spending money on it,” adding that he believes there could be other sources of funding for energy efficiency upgrades.
Ms. Burke-Gonzalez disagreed.
“The development is 35 years old. I’m sure it needs an upgrade,” she said. “From my perspective, people deserve to live in dignity. You’ve seen pictures of what a kitchen looks like after 35 years of a family using it.”
Councilwoman Cate Rogers added that, if the complex were allowed to deteriorate further, at some point in the future, when construction costs are even higher than they are now, it would need to be replaced.
The $1 million grant for The Green At Gardiner’s Point is “to cover a funding gap due to a significant rise in interest rates since the start of the project,” said Mr. Schantz. The 50-unit complex, built by Georgica Green Ventures in partnership with the East Hampton Housing Authority, was initially expected to cost just over $33 million, but is now nearly complete and expected to cost $35.4 million.
The Housing Authority received more than 540 applications from prospective tenants.
“Interest rates go up and down, but that doesn’t influence your funding (if it is in place),” said Mr. Flight. “Do they have the opportunity to refinance their debt? … CHAB needs to be putting more units on the ground. These units are already here. Going forward, this is not my preferred use.”
Ms. Burke-Gonzalez said the developers had projected interest rates of about 3 percent when working with New York State on their funding package, but ended up paying 8 percent. She said the developers are also asking Suffolk County for $1 million to cover the shortfall.
“The county is looking at this as matching what we do, but not more than we do,” she said.
Mr. Calder-Piedmonte said he was initially skeptical of the proposal, but “there’s a limit to the amount they can ask for interest rates…. This project didn’t reduce the quality of materials, even though they knew they were underwater.”
The loan to The Cottages would allow the community to hook up to public water and tie into the sewage treatment plant being built for the new Route 114 housing complex next door.
The Cottages are a complex of nine small cabins built in the mid-20th Century, which were purchased by the Sag Harbor Community Housing Trust, funded by the affordable housing buyout of the condominium development at the former Bulova Watchcase Factory in Sag Harbor Village. The Trust was unable to acquire property within the small village and instead purchased this property, which is located outside the village in East Hampton Town.
The board was in favor of the proposal.
“It’s an odd development that probably wouldn’t happen today,” said Mr. Calder-Piedmonte. “It’s in need of rehab. The Housing Authority is going to stabilize this project and help people in need, and it is very likely to get matching funds.”
The Windmill Village proposal is the only request for a loan. Mr. Schantz said the development is expecting to spend $6.3 million to add the 20 units, and is seeking the $338,000 to cover architectural, engineering and legal fees. The CHAB did raise the question of how the loan would be repaid if the project wasn’t built.
“The planning will be complicated here, but we are here to help with things that are difficult,” said Mr. Calder-Piedmonte. “I appreciate that they did this as a loan.”
Ms. Burke-Gonzalez pointed out that this project will be the first to take advantage of a recent change in town code that increased the density of units allowed in senior housing developments from 8 per acre to 12 per acre.
The CHAB had recommended not approving the St. Michael’s request for funds to build an apartment for the complex manager, arguing that it didn’t add to the affordable housing stock.
Mr. Flight disagreed.
“I actually would be supportive of this,” he said. “I know how hard those folks work, and they don’t get paid a lot. It takes one person off of competing for a unit elsewhere. I think this would be a good investment of CHAB money.”
Whalebone Workforce Housing had requested $350,000 for a housing complex that would be on land leased from the town, but is not proposing an income cap, and the use of that particular parcel for affordable housing is not allowed in the town code, said Mr. Schantz.
“We don’t feel this is actually eligible under the CHF law,” he said.
At its Dec. 5 meeting, the Town Board set public hearings on each of the proposals for its Dec. 19 meeting, which will be held at 6 p.m. The board would then vote separately on whether to approve each individual application.
Also at the Dec. 3 work session, Mr. Schantz gave an overview of a request for proposals the town is about to issue for a 16-home development known as Cantwell Court on town-owned land off of Pantigo Place. The houses are slated to be sold to people who are income-eligible and are able to carry a mortgage and make a down payment, but the underlying land would remain owned by the town.
The town is looking for at least two builders to construct the two-to-four bedroom houses. As initially proposed, the builders would construct the houses with their own funding and then sell them directly to the purchasers.
Board members suggested the possibility that CHF money could be used to give the builders milestone payments as they work to construct the houses, in order to give more builders an opportunity to work on the homes.
The bidding process will open on Dec. 12 and remain open through Jan. 30, 2025.
Mr. Schantz and Assistant Town Attorney John Jilnicki also gave an overview of a proposed code change to allow a density of up to 12 units per acre for non-senior affordable apartment complexes, by special permit. Sewage treatment would be mandatory, and there “would still be a hard cap of 60 units” per property, said Mr. Schantz.
This proposal would be different than the increased density recently adopted for senior housing, which is now allowed as-of-right, without a special permit, although Mr. Schantz pointed out “affordable housing developments are only allowed in affordable housing overlay districts, and most sites (in that zoning) are already developed.”
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