Workforce Housing: Put It In Or Pay Up

By Ian Stark

Governor David A. Paterson signed the Long Island Workforce Housing (WFH) Act Wednesday, designed to boost the region's supply of affordable homes. Sponsored by Senate Majority Leader Dean Skelos (R-Rockville Centre) and Assemblyman Robert Sweeney (D-Lindenhurst), the legislation (entitled Assembly Bill 9881-A/Senate Bill 6823-A) provides developers applying to build five or more residential units with "density bonuses" of at least 10%, or other incentives, in exchange for setting aside at least 10% of units of "affordable workforce housing" - defined as housing for individuals or families at or below 130% of Long Island's median income. However, if builders choose not to construct the required affordable housing, a payment to the Long Island Housing Partnership is necessary for each non-affordable unit - a fee that must be equal to two times the localized median income for a family of four on Long Island. (In cases where the fee exceeds the appraised value of the space, the fee equals the appraised value of the lot.)

The WFH Act has received bipartisan support - it was sponsored by every member of the Long Island delegation from both major parties - yet there are some in the greater community who feel there is more to add before the legislation can be considered complete in its ability to guarantee reasonably priced living quarters. One partial critic is County Executive Steve Levy, who does feel that while the WFH Act will result in the construction 100 to 200 new units of housing yearly, he needs to push a second proposal that would establish requirements concerning how much housing belongs in any given community, and to create further building incentives from the government. In a statement to the press, Levy explained why he feels there are still shortcomings:

"The bill is good conceptually, and it is a good message that we're sending, though we must remember that most towns have already implemented a 10% to 20% threshold for affordable housing."

Another group that is pleased yet insists on further action is the Long Island Association, a civic-minded business group, which has met with several government officials in the past to inspire the growth of affordable housing. They expressed concern over a "brain drain," that is, the number of young Long Islanders who find themselves forced to move elsewhere when they can no longer afford Nassau and Suffolk counties. LIA President Matt Crosson has stated publicly that while he considers this "the most significant development to affect Long Island housing for many, many years," it is, in his group's opinion, "only a beginning to what needs to be done."

But perhaps the most extreme public criticism of the WFH Act has come from Southampton Town Supervisor Linda Kabot, who expresses support for the new law, but questions the possible results in her district. She had sent a letter to Governor Paterson prior to his passage of the legislation, citing the possible shortcomings she believes could arise. In an area such as Southampton, where the median income for a family of four is $97,000, any fee paid to opt out of constructing affordable housing - which would amount to $194,000 - would, in Kabot's opinion, allow builders to then erect million-dollar properties, thus coming away with very sizable profits. She further theorizes that the collected fees would end up in the construction of housing in areas where real estate values are lower (such as Flanders and Hampton Bays), and in effect do nothing to keep the next generation of homeowners from leaving for a lower cost of living elsewhere. Additionally, while Kabot has no criticism for the Long Island Housing Partnership itself, she feels that the Southampton Housing Authority or other groups such as Habitat for Humanity would provide greater local control over the collected monies.

Since the act's passage, Kabot has said that she would be working with State Assemblyman Fred Thiele in creating localized amendments to the law. However, while Thiele has stated that he will assist in some respects, he also offered some intense disagreement with the Southampton Town Supervisor's stance and criticisms of the WFH Act. He believes that the East End's towns and village leaders have been well aware of this legislation for years, and that "a diligent elected town official interested in affordable housing would have this bill on his or her radar screen."

"Supervisor Kabot has stated that the developer can choose whatever option it wants to satisfy the requirement [regarding construction of the affordable housing]. That is erroneous," said Thiele. "It is the local government that makes that determination. The statute says, 'such local government shall require of the applicant.' There is nothing that gives that choice to the developer. Thus, the issues involving the fee will never come into play since the local government can always say no to the use of a fee if it is not the best option."

But Thiele does see room for changes as well, adding that while towns can always require developers to build affordable housing when deemed necessary, he does believe that the fee option needs revision, stating, "In my opinion, the fee should always equal the appraised value of the additional lots resulting from the density bonus. This would insure that there is no windfall to developers."

Other amendments Thiele would like to see include the ability of local governments to work with other not-for-profit housing groups in addition to the Long Island Housing Partnership - an area where he does agree with the supervisor's goals. He also plans to recommend a provision that confirms the right of local governments to impose additional affordable housing requirements over and above the state law, and furthermore to expand the flexibility for districts in how they can use the collected money for down payment assistance. While he personally feels the "fee option" is not viable under the WFH Act, he believes the option has come about with the hope of encouraging the building of affordable housing, rather than to inspire payment not to.

Thiele feels strongly that this law can be administered without any of the negative consequences that Kabot has predicted, and added, "I should point out that if local governments had met their responsibility to provide affordable housing opportunities, the legislation would not be necessary. Few local governments have a good track record on this issue."

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