State Assemblymember Fred W. Thiele Jr. of Sag Harbor has reintroduced the Accessory Dwelling Unit Incentive Act, his legislation to address the affordable housing crisis and incentivize property owners to construct accessory units.
One incentive Thiele proposes is dubbed the Accessory Dwelling Unit Forgivable Loan Program, which would be administered by the Division of Housing and Community Renewal.
Noting that the upfront cost of building accessory dwelling units is one of the biggest impediments to their creation, Thiele explained that the loan program would provide property owners with a forgivable loan of up to $75,000 for 20 years to construct a unit. If the property owner rents the unit to tenants meeting affordable income and rent guidelines for the 20-year loan period, the loan would be forgiven and become a grant.
Others incentives planned include an income tax credit and a property tax exemption for a property owner with a legal accessory unit who rents it under affordable occupancy, rent, and income guidelines. The amount of the income tax credit would be 50 percent of the difference between the market-rate rent and the affordable rate rent, not to exceed $10,000 per tax year. Local governments would be authorized to grant a property tax exemption equal to 100 percent of any increase in assessed value of the property attributed to the construction of the accessory unit.
“Accessory dwelling units can be part of the solution to provide affordable multigenerational housing options to workers and families,” Thiele said. “Incentives, not mandates, are the best approach to make the existing housing stock more attainable. Local governments should be our partners in addressing the need for affordable housing on Long Island and across New York. The state should provide resources such as technical assistance, model local laws, best practices and funding to local governments to implement a workable accessory dwelling unit program.”
Staff Writer on Feb 1, 2023