Thiele Plan Would Modify Hochul’s Housing Compact

Pictured Above: New York Governor Kathy Hochul visited new artist housing at “The Barn” in Albany March 1 while stumping for her Housing Compact. | New York Governor’s Office photo

As local governments here have expressed wariness about Governor Kathy Hochul’s top-down approach to regulating affordable housing in her recently proposed “Housing Compact,” East End State Assemblyman Fred Thiele’s plan to get the state to use incentives instead of mandates to encourage housing development has won support in Albany.

Ms. Hochul’s plan, first unveiled in her State of the State address in January, was originally a part of her 2023-2024 budget, but she has since made it a stand-alone bill that will likely be modified significantly by a legislature that’s already heard an earful of opposition from local governments and constituents.

What’s not to like about it? A lot, say local governments.

“It’s all sticks and no carrots,” summed up East Hampton Environmental Technician Morgan Slater in a March 21 presentation to the East Hampton Town Board. “It is mandating a large amount of development with little aid from the state.”

The Housing Compact would require towns within the Metropolitan Transit Authority’s service area to ensure a 3 percent annual increase in housing stock within three years after its adoption — and that housing stock would not need to be affordable.

If towns don’t meet that target, which for East Hampton would be 600 new housing units, they would be required to enact two out of five major changes to their residential zoning codes. Those changes range from reducing regulations regarding accessory dwelling units, allowing subdivision of lots through an administrative process without planning board review, and allowing intense developments in the half-mile area around train stations, a strategy known as transit-oriented development.

Under the governor’s plan, if towns don’t change two out of five zoning codes, they would be required to approve proposed projects within 120 days, as long as the property has appropriate water, septic and utility infrastructure.

The plan would also include $250 million in funding for infrastructure improvements to accommodate the new housing.

“It’s likely to turn supporters into opponents,” said Ms. Slater. “It undermines our existing affordable housing efforts and holds the door open to developers to build high density luxury housing.”

While Ms. Hochul’s plan is based on a core assumption that increasing housing stock will make housing more affordable, Ms. Slater said that is unlikely in a town like East Hampton, where real estate prices are astronomical and land has become a commodity.

“It’s completely contrary to what we’ve tried to do over the past decades” with affordable housing, said East Hampton Town Supervisor Peter Van Scoyoc. “Some of what her proposal is really about is just building more market rate housing. We don’t need more market rate housing here… No one that works within this market can afford to live within this market anymore. East Hampton risks becoming a commodity instead of a community. That’s really where we are now.”

The Southold Town Board unanimously adopted a resolution Feb. 28 opposing the housing compact, which it said would require “extreme and substantial amendments to the Town of Southold’s local zoning.” It also stated that residents who have given much input into the town’s own Comprehensive Planning process “will be disenfranchised from their local elected officials, local volunteer boards and render all of the residents input meaningless.” The resolution came on the heels of a similar statement from the East End Supervisors and Mayors Association.

“I’m very proud we’re able to offer such a powerful statement that will be promptly ignored three minutes after it gets there,” Southold Supervisor Scott Russell joked as members of the Town Board praised the statement.

But from the East End to the Hudson Valley, leaders in areas serviced by MTA railroads have become vocal in their opposition, and State Assemblyman Fred Thiele says that the message has reached lawmakers in Albany.

Mr. Thiele, who chairs the New York State Assembly Local Governments Committee, has long been an advocate for New York’s 60-year-old Muncipal Home Rule Law, giving power over zoning issues to local governments, and he is leading a growing coalition of state lawmakers who want to pivot the Housing Compact back to local control.

Mr. Thiele announced March 16 that the Assembly Budget Resolution includes his plan to modify the Housing Compact “by eliminating mandates and zoning overrides in favor of $500 million in new state aid to cities, towns and villages as an incentive to create new housing opportunities.”

According to Mr. Thiele, the Assembly plan would give municipalities an initial 30 percent payment for submitting a housing growth plan. They would then receive another payment of 70 percent if they meet their housing growth targets during the three year period beginning Jan. 1, 2024. The housing growth target would remain at 3 percent for downstate communities, but “will be calculated with special consideration for affordability, rehabilitation of abandoned buildings, transit-oriented development, and zoning changes.”

The State Assembly also plans to allocate $1.5 billion in funding for tenants and homeowners, including funding for housing vouchers and assistance for people whose rents are in arrears and first time homeowners.

“Local governments know their communities the best,” said Mr. Thiele. “I commend the governor for recognizing the lack of affordable housing and setting goals to address the crisis. However, we must work collaboratively with our local government partners. Incentives, not mandates, are the best approach to make housing more attainable. For this reason, I am working with my colleagues, our local governments and the governor to find the consensus and flexibility that is required to implement a reasonable plan and address the current housing crisis on Long Island and across New York.”

East Hampton Planning Director Jeremy Samuelson said Mr. Thiele “read the situation correctly” in suggesting a fix that would both offer incentives and respect Home Rule.

“It’s critical to this that it’s a municipal-level process,” said Mr. Samuelson at the East Hampton Town Board’s March 21 work session. “We’re witnessing a series of negotiations here. The governor put forward an ambitious and aggressive plan that does not work well with individual municipalities… The governor staked out a position on one extreme, and a cooler set of heads are prevailing.”

“Our ability to continue to be masters of our own destiny is at stake here,” he added. “It’s a dangerous precedent. I’m dumbfounded that we’ve gotten here. It’s counter to the core relationship between local government and the state.”

Mr. Van Scoyoc said he’d recently had the opportunity to talk with Governor Hochul about the proposal.

“I told her transit-oriented development is fine, but you have to have transit first,” he said. “We’re woefully underserved by the Long Island Rail Road… I told the governor, ‘get us some more trains and we can talk about transit-oriented development.”