Council creates affordable housing fund: essential if voters agree on housing need

The decision to create city-sponsored affordable housing on Shelter Island took a big step forward on Friday, April 29.

The City Council, at its regular meeting, established a Community Housing Fund, into which would be deposited funds received from various sources solely dedicated to the construction or acquisition of affordable housing – including a new tax, grants and city ​​funds. The vote was unanimous.

Last October, Governor Kathy Hochul (D) signed legislation that will allow East End towns to establish a new property sales tax for community housing funds.

The new law, which previously vetoed former Gov. Andrew Cuomo (D), will allow the five towns in the Peconic Bay area to hold referendums on adding 0.5% to the existing tax of 2 % on the Community Preservation Fund on real estate transactions in these cities. Each city must present a detailed plan of the funds to their respective communities before holding a referendum in November.

With the resolution passed by Council, no funds were allocated. It was just to put it in place to be used if voters approve the November referendum here. As Councilwoman Meg Larsen noted after the vote, “It’s the piggy bank. The plan will say how it will be used.

The fund can be used for land purchase, construction, planning and engineering and related costs.

Supervisor Gerry Siller noted that Assemblyman Fred Thiele Jr. (I-Sag Harbor), who co-sponsored state legislation with state Sen. Anthony Palumbo (R-New Suffolk), has calculated that if the housing fund had been in place in 2020 when Governor Cuomo vetoed it, $30 million could have been generated in the area for affordable housing.

Elizabeth Hanley, who is chair of the advisory board for the Community Housing Fund, which is creating an affordable housing plan for the island, gave a presentation on the legislation.

Resident Stephen Jacobs asked about other names for affordable housing, including community housing and workforce housing. City attorney Stephen Kiely noted that “community housing” is the term used in state law, but all terms mean the same thing.

People who qualify for affordable housing must live or work on the island, and their incomes would be capped at $124,7000 for a household of one or two people and $148,800 for a household of three or more people. If the referendum is passed in every city, the legislation would also increase the exemption on improved properties in the East End, reducing property transfer tax for almost a third of all transactions.

The exemption on Shelter Island would increase from $250,000 to $400,000, ultimately reducing the existing transfer tax to $1 million or less on Shelter Island and South Fork.

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