Pictured Above: The proposed Sag Harbor Residences, as designed by Beatty Harvey Coco Architects, were pitched just after Sag Harbor adopted its new code.
Two sections of Sag Harbor’s affordable housing code adopted last June have been struck down by a New York State Supreme Court Justice, citing incomplete analysis under the New York State Environmental Quality Review Act.
The community group Save Sag Harbor filed a lawsuit last fall alleging the village had failed to thoroughly review the possible environmental impacts of the project.
Just one day after the village adopted its housing code to allow affordable housing by special exception use in Village Office and Business zoning districts last June, developers submitted a proposal to build a three-story, 100,000-square-foot, 79 unit affordable housing complex along Bridge and Rose streets just behind Sag Harbor’s Main Street.
Their proposal drew the suspicion of village residents concerned about the timing of the filing and major changes in the village proposed by Adam Potter, who operates the LLCs that hold the five lots where the housing complex was proposed. Mr. Potter was also involved with the Friends of Bay Street proposal to build a new theater at the foot of the Jordan Haerter Sag Harbor Memorial Bridge. Bay Street has since signed a new lease to stay put in its existing location and has put that property back on the market for $25 million.
Two partners in the affordable housing complex, Conifer Realty and Smith & Henzy Advisory Group, backed out of the project in December of 2022, citing the financial climate at a time of rising interest rates.
New York State Supreme Court Justice Stephen Hackeling agreed with the plaintiffs in his April 10 decision in the case of Save Sag Harbor vs. The Village of Sag Harbor, annulling two sections of the village code — Local Law 12, which allowed affordable housing in the business and hamlet office districts, and Local Law 11, which was the administrative portion of the town’s affordable housing code.
Save Sag Harbor’s lawsuit alleged that the village failed to prepare Parts 2 and 3 of an Environmental Assessment Form or make its determination of significance of the proposed local laws in public, as required under SEQRA.
“We’re gratified that the court recognized that these laws were passed without the in-depth hearings and environmental review that such proposed changes to our village require,” said Save Sag Harbor in a statement after the judge’s decision. “Affordable housing is an urgent need in Sag Harbor Village and the surrounding area, and we will support the village and town governments in developing responsible legislation to this end. Such legislation also should be part of a comprehensive planning process with input from the whole community.”
Sag Harbor Village Attorney Elizabeth Vail said at the Village Board’s April 11 meeting that she disagreed with the decision, and the village has the right to an appeal.
She added that a third section of the code, Local Law 13, which allows accessory apartments, was not challenged in the lawsuit, but that administration of Local Law 13 depended on the administrative portion, Local Law 11, being in effect.
“We’re going to take some time before we make any decisions about a next step in terms of the litigation and in terms of the affordable housing initiative,” said Sag Harbor Mayor James Larocca at the board’s April 11 meeting. “Don’t look for any headlines from us right now. We want to digest it and understand the implications. The connection to the one law not annulled is nevertheless significant. We have one large project applied for, and some accessory dwelling unit applications have been filed. We need to examine the impacts on those applications.”
“We continue to support other recent affordable housing legislation, including Local Law 13 permitting accessory dwellings, and the potential plan for affordable housing off Brick Kiln Road put forward by Trustee Gardella,” said Save Sag Harbor in their statement.
Mr. Gardella, a Trustee on the Village Board, had proposed in February that the village’s Department of Public Works be moved from property that now houses the Sag Harbor Fire Department and Volunteer Ambulance Corps to another village-owned site at the Long Pond Greenbelt during an upcoming replacement of the emergency services buildings, potentially making room for 12 affordable apartments adjacent to the new firehouse and ambulance barn.