Thiele Optimistic About Community Housing Fund Bill

Assemblyman Fred W. Thiele Jr. of Sag Harbor said he is confident that, on its second try, his legislation to establish a Community Housing Fund as an option to bolster affordable housing efforts in the five East End towns will be signed into law.

The state law was first passed in 2019 but the governor vetoed it, and in 2020 the legislation was back-burnered due the pandemic. Mr. Thiele’s bill successfully passed the State Legislature again in 2021. Sometime between now and the end of the year, it will be sent to Governor Andrew Cuomo for his veto or signature.

The assemblyman explained that there are a few factors that swung in favor of the bill’s signing this time around.

The bill would impose a 0.5-percent tax on home sales in the towns where voters chose to create a Community Housing Fund. A town may then use the revenue collected through the tax to increase the local supply of affordable housing. That can be achieved a number of ways under the legislation, including providing financial assistance and housing counseling to first-time homebuyers, building housing, rehabbing buildings, or purchasing existing housing to make available for sale or rent.

“I never speculate as to what the governor is going to do,” Mr. Thiele said to preface his thoughts, though he went on to explain why the bill is likelier to receive the governor’s signature this time.

In January 2020, after the bill passed in the 2019 legislative session was vetoed, Mr. Thiele met with the governor’s counsel, Beth Garvey. “We spent a good hour with her and the governor’s staff going over the bill,” he recalled. “... They wanted more detailed information from the towns about the extent of the housing problem and how this bill would help to solve it.”

Mr. Thiele also noted that the governor had vetoed the bill along with several other bills that raised taxes or created new ones. To assuage the governor’s concerns over creating a new tax, he explained to Ms. Garvey that the bill actually will lower transfer taxes on East End houses sold for less than $1 million — because it raises the amount of the purchase price that is exempt from the 2 percent Community Preservation Fund tax from $250,000 to $400,000 for homes sold for less than $2 million. Homes sold for more than $2 million would no longer receive any exemption.

“It’s just an increase for those deals that are over a million dollars or more, which won’t have an impact on affordable housing,” Mr. Thiele said.

The bill also increases income eligibility for the first-time homebuyer exemption, which fully waives the CPF tax and also would waive the Community Housing Fund tax. “People making less than $150,000 and buying a home for under $950,000 will be exempt,” he said.

The other reason Mr. Thiele said he believes the bill will be looked on more favorably this time is the extent of the housing crisis. A problem that was significant on the East End before the pandemic is now threefold, exacerbated by the pandemic, he said: “It is harder than ever for people to find a place to live. Rental housing has disappeared.”

The former rental inventory was sold to people who came east during the pandemic, and prices are higher as inventory remains low, he explained.

“The reason for the bill is more compelling than ever,” Mr. Thiele added. “So, you know, I’m optimistic that we can overcome the previous objections of the governor — but I don’t speak for the governor. Ultimately, they’ll make that decision.”

His next step is to plan a meeting with the governor’s office, the five East End towns and housing advocates. “We’re going to do everything we can to make the case to the governor’s office,” he said.

He also encouraged advocacy from members of the business community who are having difficulty attracting workers due to the lack of affordable housing. “I’ve heard from everybody from [Stony Brook] Southampton Hospital to the Long Island Farm Bureau, to local school districts, all of whom are having difficulty finding workers, and certainly that is the case now in the hospitality industry with restaurants, etc.”

Mr. Thiele said that if the bill is signed into law, the five East End towns will likely each schedule public referendums in November 2022.