The Peconic Bay Community Preservation Fund turns 20 this year.
The 2 percent tax on real estate trades in the five East End towns has generated $1.38 billion, the overwhelming majority of which—more than $1.19 billion—in Southampton and East Hampton towns since 1999, according to State Assemblyman Fred W. Thiele Jr.’s office.
All that money is committed to preserving open space and historic properties, creating parks, restricting development on farmland, and addressing water quality issues—and town officials have been busy on the South Fork doing just that.
“If we don’t have our natural resources, we don’t have anything,” said Mary Wilson, who just recently stepped down as CPF manager in Southampton Town.
East Hampton Town has preserved more than 2,150 acres through more than 290 acquisitions using $216.7 million in CPF revenue for purchases of properties, conservation easements and development rights.
The largest in acreage was the purchase of development rights on two parcels that created a nature preserve in Wainscott in 2001. The Nature Conservancy now stewards the 60.3-acre property, intended for hunting and trails. But the largest price tag was for the historic preservation of 3.7 acres owned by the Gardiner family in East Hampton Village, for $9.66 million in 2014.
“It’s pretty unprecedented,” said Scott Wilson, the East Hampton Town director of land acquisition and management since 2006. Previously, he worked for the Peconic Land Trust, dealing with the CPF program since 2000.
“When the original law was passed, it was set to sunset in 2012,” he continued; voters extended the law in a subsequent referendum for several decades. “It was somewhat of a shock to the legislators, who helped get this law adopted, at its success. Leading up to the adoption of the law in 1998, the market was pretty flat for a decade. ... The legislators had no idea the fund would generate so much money.”
In Southampton, through more than 420 acquisitions, the town has preserved more than 4,400 acres using over $657.7 million in CPF revenue—two-thirds for open space and the rest for farmland.
The largest single purchase, as far as acreage, came in 2010, when the town paid $5 million to buy and preserve 150 acres in East Quogue known as “The Links”—which runs adjacent to where a luxury golf resort is now proposed. Suffolk County pitched in the other $5 million for the 2010 purchase.
Topping the list in terms of dollar amount is the $14.05 million purchase of Beach Plum Meadows in Southampton Village. The 11 acres was once eyed for a senior housing development, which was denied by the Village Board.
Southampton has spent the most CPF money in Water Mill—more than $90.3 million—but the most land was acquired in East Quogue, more than 830 acres. The town has collected the most money in Southampton Village: more than $170.8 million from transactions there.
“The landscape today is dramatically different from how it was,” Mr. Wilson said. He said anyone would be hard-pressed to find 20 acres of land or more available for preservation or development.
Housing advocates, like Diana Weir, the Southampton Town director of housing and community development, are concerned that the need for affordable housing hasn’t kept pace with conservation. An early supporter of the CPF, she has said the towns should not be buying land to prevent building, calling it the “Stop Development Fund.”
These growing pains are essentially why the fund, which is set to expire in 2050, was a complex piece of legislation to pass, Mr. Thiele said.
“The Community Preservation Fund was an overnight success that took us 10 years to pass,” Mr. Thiele laughed. “One of the issues with the Community Preservation Fund and why it languished is that we can’t do the same thing over and over again while we had opposition from builders and Realtors who were able to exercise some influence in Albany. We had to build a grassroots coalition. Realtors out here, they had an enlightened self-interest—that it was actually good for business, not bad for business. Eventually, local builders and banks supported it, too.
“This has succeeded beyond our wildest expectations,” he continued. “We would have never thought it would generate this much revenue. We knew it would be a conservation and preservation tool, but we didn’t know it would be this expensive or this useful.”
However, Mr. Thiele acknowledged the fund has had its fair share of issues.
In 2007, East Hampton Town officials overspent the general fund budget and raided the CPF to make up for the deficit. An audit caught the transfer of funds, and the money was restored to the CPF. “To everyone’s credit, we caught it really soon,” Mr. Thiele said.
Mr. Thiele touts the towns’ ability to maintain the integrity of the program over the last two decades.
“Sure, if I was king, I wouldn’t have bought certain properties the towns purchased. But there hasn’t been even a whiff of a single scandal or land deal gone wrong,” he said.
In 2016, the fund was expanded by referendum to allow a portion of the annual revenue to be used to address water quality issues.
“The water quality projects are different and, in some ways, more complicated than land preservation. In land preservation, your biggest decision is, ‘Is this the right purchase price?’ and ‘Do we need to buy the title or the development rights?’ But it is pretty straightforward,” Mr. Thiele said. “Water quality is one of our great challenges and we needed to get the funding there, but the towns are still feeling their way to find the best way to use these resources.”
Building on that referendum, the state expanded the CPF in January to be used for the construction and connection of water mains to residences where private drinking wells have been contaminated; and to support town-sponsored loan programs that allow homeowners to install nitrogen-filtering septic systems that can be paid back through property taxes.
Town Attorney James Burke is serving as interim community preservation manager while Southampton officials find a replacement for Ms. Wilson, who stepped down in January after serving in that role for 17 years. He headed Suffolk County’s acquisition program in the late 1990s, while he serves as the county’s assistant director of real estate.
From a legal perspective, the fund has often been a difficult subject for board members and residents to wrap their heads around—and keep the program free of “black marks,” he said.
“Mary did a phenomenal job with it,” Mr. Burke said of his predecessor. “Take one of our more recent challenges: the emerging contaminants in our waters and how to address that. The 2016 referendum and the most recent law to tap into the fund to extend water mains have been success on the state level.
“We were largely handcuffed on that issue,” he continued. “We knew what we wanted to do based on the incredible need, but the state law kept us cuffed.”
Up to 20 percent of revenue may be used toward water quality initiatives, including a separate rebates program for homeowners who want to replace traditional septic systems.
Using CPF revenue, there have been under 20 installations partially covered by the rebate in Southampton since its inception in 2017, but only four rebates were paid out in 2018. In East Hampton, 11 systems were installed using the septic system improvement rebate program as well as separate grant programs offered through Suffolk County and the state.
“When the fund was created, all four of the purposes are equal—you are supposed to love all of your children equally,” Mr. Thiele said. “But when the fund was created, the proponents were really for open space and farmland. Historic preservation has become the red-headed stepchild of this program.”
Under 10 acres in Southampton and more than 20 acres in East Hampton have been used for historic preservation. But whenever the towns have made purchases intended for historic preservation, some in the community are left to believe it’s a misuse of tax dollars, to prevent a commercial property from changing.
Last year, Southampton used its CPF to pay to put covenants on the Sag Harbor Cinema Arts Center to maintain the building’s aesthetic and guarantee its use as a cultural institution in perpetuity.
There are nine other CPF-purchased properties eligible for restoration, according to Southampton Town’s 2018 Community Preservation Fund Management and Stewardship Plan.
In East Hampton—aside from the purchase of the Gardiner property in 2004—there are three other properties that the town owns the title to, and five properties where the town owns historic preservation and facade easements—notably the Thomas Moran House.
“There is this evolution whereas there is less land available—because the CPF did its job—and there is a focus more toward what has not been done, like historic preservation,” Mr. Thiele said. “We are going to see more and more of it.”
on Feb 4, 2019