April 05, 2006

Keep The Homes Affordable, Says Planning Board

Despite provisions Southampton Town has employed to encourage the sustainability of affordable homes in planned development districts, the Southampton Town Planning Board had been hoping for fewer loopholes.

Town housing director John White addressed the board's concerns about the town's PDD legislation regarding the resale of affordable homes and maintaining their affordability at its morning work session last Thursday.

"I want you to keep in mind that a lot of this is new and evolving as we speak," White told the board. "There is no panacea, no perfect solution but we try to reach the best possible solutions that we can."

At the time of a resale, the town has first right of refusal. If it chooses to keep the home affordable, the town has 90 days to identify a qualified buyer — one who can meet mortgage and loan eligibility requirements. Failure to find an eligible buyer would give the homeowner the right to put the house up for sale at market value.

The town and the homeowner split the appreciated equity from the resale if it is sold at market value.

"Why wouldn't they leave that house in the pool of affordable homes?" asked board member Jacqui Lofaro.

The town's resale provisions do not require the owner of the affordable home to sell it to another qualified buyer, because that would create undue burden on the homeowner, leading to potential lawsuits, White explained.

However, the Comprehensive Plan states the town is responsible for maintaining the affordability of that unit and it "could be [legally] challenged if they just decided to let that unit go," said White.

Accordingly, the housing authority is adding to its database of qualified buyers that should help the town to find a purchaser before the 90 days are up.

What if the list of qualified buyers fell into the wrong hands? board member Alma Hyman posed. "You can't count on there being an extensive list year by year because of circumstances and because of who's handling it," she said, adding that "very specific regulations" should be required.

White dismissed the hypothetical, contending that the town cannot plan for employee incompetence — such behavior would be in violation of town code. "This is the law; it's not a matter of choice," he said.

Lofaro also asked White if the PDD law had a provision that specifies a minimum threshold below which the list of qualified buyers could not drop. "And I say this because a good piece of legislation anticipates what might not happen," she said.

There is no set number, White responded, but the town is actively pursuing more buyers through "constant advertising" of the database, which remains an "open-ended registry." Additionally, the lotteries draw a lot of attention and because affordable housing has become a regional issue, a great deal of information is already available, he said.

The question of whether or not an affordable home should remain affordable should be left to the public to answer, said Chairman Dennis Finnerty. Future town boards cannot be wholly trusted to sustain affordability because they may bow to political pressures, "especially [from] small constituencies that may force them to extinguish some affordable housing units."

There is a provision currently on the books known as the Alienation Provision, which mandates a town-wide permissive referendum to reopen preserved land so that it can be put up for sale. Finnerty suggested a similar measure be put in place that would allow the public to vote on the fate of an affordable home at the time of its resale.

Also, there is nothing in the code about giving preference to volunteer firefighters or ambulance workers, Finnerty observed.

White explained that most lotteries involve federal subsidies, which preclude the town from offering preferences. "Now, in a case with a middle income unit with no subsidies coming in, then the town could do preferences," he said.

White also addressed the board's unease about homeowner's associations forcing out affordable units by increasing maintenance charges. "Economic discrimination" of this nature is "a legal issue," he said, and the homeowner's associations would likely find themselves spending more than they bargained for because of legal expenses.

Unsatisfied with that response, Lofaro said the town should not assume homeowner's associations would be deterred by potential lawsuits.

"We can't protect ourselves from somebody wanting to discriminate against somebody else," White retorted. The PDDs also have restrictions on capital projects that would drive assessments up and subsequently drive the affordable housing out.

Besides, White said, any modifications to the complex would require town board approval. The PDD is a legislative act and can only be modified by legislation.

"That's a good safeguard, and I like that assessment provision," said Finnerty. White appeared to allay most of the board members' concerns, and, overall they were satisfied with the terms and conditions of affordability.

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