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UPSTATE UNPLUGGED: Are local communities going to lose control over housing?

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More detail on NY Housing Compact

The word housing appears 95 times in Governor Kathy Hochul’s 162-page FY 2024 Executive Budget Briefing Book. It was the document released last week ahead of her message on Wednesday, when many expected more detail on plans to address the state’s housing crisis.

Last week we dove into the facts, as we knew them, about Gov. Hochul’s housing proposal, which proponents say will be a game-changing effort that will lead to 800,000 new housing units over the next decade.


What details were in the Governor’s budget book?

While precise details on how the state’s Housing Compact would be executed were lacking — several statements were made in the budget book that leave suggestions on how this might go.

  • Governor Hochul’s newly formed New York Housing Compact is a bold plan that will build on the extraordinary commitments made in last year’s budget to increase affordable housing and more with the creation of 800,000 new homes over the next decade.
  • New York’s Housing Compact will increase affordable housing statewide and will coincide with multiple initiatives to support New Yorkers struggling with utility bills, assist retrofitting homes for energy efficiency, and guarantee energy affordability.

What plan was already in motion?

“The FY 2023 Enacted Budget set in motion Governor Hochul’s $25 billion, five-year Housing Plan to create and preserve 100,000 affordable homes, including 10,000 homes with support services for vulnerable populations, and electrify an additional 50,000 homes. Funding includes $5.7 billion in capital resources, $8.8 billion in State and Federal tax credits and other Federal allocations, and $11 billion to support the operation of shelters and supportive housing units and to provide rental subsidies. This investment represents the largest, broadest housing plan in New York State history, but it alone cannot solve the crisis. To ensure that all New Yorkers have access to housing requires the partnership of the private and public sectors, and cooperation of all levels of government in every region and community across the State. The FY 2024 Executive Budget launches a framework to empower localities to achieve a bold goal of creating 800,000 new homes over the next 10 years.”


What is the current state of the housing market?

“New York State is currently facing a severe housing crisis, with more than half of New York renters paying more than 30 percent of their income on rent – the second-highest rate in the nation. Outside of New York City, renting costs have risen 40 to 60 percent since 2015 while home prices have risen 50 to 80 percent. At the most fundamental level, the housing crisis reflects that more people wish to live in New York than there are homes. New York’s strong economy also contributes, as the State created more than 1.2 million jobs in the past decade. By contrast, in that same time frame, only 400,000 new homes were built. The single most important thing New York can do to alleviate the housing crisis is to create more homes.”


How does 800,000 new homes in 10 years get achieved?

“The Executive Budget supports a bold new approach to ensuring everyone has access to housing by empowering localities to achieve a goal of creating 800,000 new homes over the next 10 years. The Budget makes it easier for families to access child care, provides support to the child care workforce, and engages the business community in new ways to build child care supply. The Budget also supports New York City’s efforts to provide support services and assistance to migrants and enhances programs that are a lifeline for vulnerable New Yorkers, bolstering social and economic justice and opening doors to opportunity.”


What are the steps outlined in the plan?

  • Require all cities, towns, and villages to achieve new home creation targets on a three-year cycle.
  • Localities that do not meet growth targets or fail to implement an action plan will be considered non-compliant and be required to approve proposed housing developments that meet certain affordability criteria.
  • Developers will be able to fast-track appeals through the state if stymied by local boards or zoning.
  • The state will collect local zoning and housing production data to create a mapping system. Hochul’s plan contends this will help better inform future decision-making on housing.
  • The budget makes $250 million available in available through an Infrastructure Support Fund, and another $20 million for Planning Assistance. Municipalities can leverage grants to push toward its goals.
  • Expedite rezoning and development of new homes, the Housing Compact gives relief from certain environmental reviews.
  • Encourages housing construction and rehabilitation through accessory dwelling units, multi-family affordable housing development, and repairs to certain types of homes.
  • Create a Homeowner Stabilization Fund to finance home repairs in communities that have been identified as having a high-volume of low-income residents.

Analysis: Matt Horn talks process, local control elements in proposal

This week our featured conversation is with Matt Horn. He was the city manager that led Geneva through its Downtown Revitalization Initiative win in 2016, and now serves as Director of Municipal Services for MRB Group, based in Rochester, New York.

“As always with these things, the devil is really in the details,” he explained. Horn says that over the last several years Governors have rolled out big policy initiatives, then let the legislature work out the details as the budget process unfolds. While that’s true in this case, there have been even more questions about enforcement, and what control local communities will retain in this Compact. “I’ll start out by saying the New York Conference of Mayors, the the Association of Towns for New York, are pretty concerned about the Governor’s apparent infringement on local control. That the municipalities have very few tools to manage the marketplace. Zoning is one of those tools. As someone who used to be charged with engendering a healthy community, I’ll say it is important that local government retain some modicum of control. That they ultimately manage the assets that are in front of them.”

Horn went on to explain that one issue created in New York involves the tourism-centric economy. “It’s not really fair for one local government to create an issue for another local government. So if you think about it, and I’ll use some non-New York examples, we’ve seen communities in the south who really want to be a tourism driven economy. So, you find hote workers who drive hours to work, because they can’t afford to live in a beach community, or the same might happen in a ski resort community,” he continued.

The same can be said for wine country in Upstate New York or the Finger Lakes.

“So what happens is local governments fosters an economic strategy that relies heavily on lower wage workers, and then do nothing to advance any kind of housing, or do very little to advance any kind of housing initiative to address it. What happens is the lower wage workers are pushed out into surrounding communities, and those places are left to grapple with the challenges of finding suitable housing and safe housing for these folks,” Horn added. “Basically, if you’re someone who is creating a demand for housing, by virtue of creating jobs for example, but are putting up regulatory barriers to the creation of housing, and specifically affordable housing, then the state’s going to create these intervention techniques to force you to deal with the problem you’re creating.”

All that said, Horn doesn’t believe the policy will have an impact on communities that don’t have demand. “Local zoning is going to be a small part,” he explained. “At least that’s my read of this. Right now local governments have very few tools, so the Governor is trying to encourage local governments to use the tools at their disposal to address this 800,000. But we can’t spark demand in place where demand isn’t there.”

Horn says that for communities where there isn’t any demand there will be less pressure from the state. The pressure will come from communities where demand is being created, and zoning regulations exist as barriers.