The New York State Legislature passed a $153 billion FY 2017-2018 budget on April 9th. The spending plan appropriates $2.7 billion for affordable housing including $2.5 billion for a new 100,000-unit, state-wide, 5-year housing plan. NYHC would like to again thank Governor Cuomo, Speaker Heastie, and Majority Leader Flanagan for funding the 5-year housing plan to address the growing affordable housing need across NY State. Through their leadership efforts, NY has shown the rest of the nation how fundamental and critical it is to invest in affordable housing despite being in a period of great federal funding uncertainty. This unprecedented achievement is also a credit to our ongoing advocacy and the strong partnerships between New York housing groups. Congratulations to everyone involved in the fight for the MOU funds!
Funding
Last year’s $1.97 billion Housing Plan funds were reappropriated this year and supplemented by $541.5 million in future year capital to create the $2.5 billion Housing Plan funds. Similar to previous years, ongoing HCR programs are funded through the general fund and the Mortgage Interest Fund (MIF). $97 million was appropriated from the general fund for housing programs- some funding levels differ significantly from previous year. The MIF was also tapped for excess reserves for nearly $134 million for housing programs administered by Homes & Community Renewal. MIF funds were also allocated for the following purposes: $1,000,000 for NORC; $1,000,000 for NNORC; $6,522,000 for HHAC; and $12,500,000 for “municipal relief to the City of Albany”. This funding for the City of Albany is a departure from housing-related uses seen in previous years. For full details, see NYHC NYS Housing Program Budget Chart linked here.
Spending Schedule
According to the budget legislation, the appropriation schedule for the $2.5 billion in housing plan funds will provide an average of $543 million annually over the next 4 years. Since capital funds may be rolled over into future fiscal years, it is unclear what the production schedule is for this plan that started a year late.
Housing Plan Programs
A full list of all funded housing programs is found in the NYHC NYS Housing Program Budget Chart. Below are programs funded in the $2.5 billion housing plan.
• Supportive Housing– $950 million for the construction of 6,000 supportive housing units throughout the State. With lack of political will to renew the successful city-state NY/NY supportive housing agreements, the State is now independently funding their own supportive housing plan. Supportive housing is proven to save taxpayer dollars by stably housing homeless people with disabilities.
• New Construction– $472 million for new construction or adaptive reuse of rental housing affordable to households that earn up to 60 percent of area median income (AMI). We expect this funding will go towards new housing on state-owned sites, including sites in the “Vital Brooklyn Initiative” investing in Central Brooklyn.
• New York City Housing Authority Capital– $200 million for projects and improvements related at housing developments owned or operated by NYCHA. The FY 2018 budget requires NYCHA funds to have a plan approved by the Director of the Budget, in consultation with NYCHA and DASNY, for the purpose of capital projects and other improvements. NYHC has been a strong advocate for State funding to meet NYCHA’s most pressing capital needs. We hope this funding is released in a timely manner and goes towards critical capital needs such as roof replacement.
• NEW Affordable Housing Preservation– $177 million for substantial or moderate rehabilitation of affordable multi-family rental housing currently under a regulatory agreement. NYHC made recommendations with other housing groups for this “Year-15” type program to ensure we are preserving existing affordable housing.
• Moderate Income Finance Program– $150 million for new construction, adaptive reuse, or reconstruction of rental housing affordable to households that earn between 60% and 130% AMI.
• NEW Senior Housing– $125 million for developing or rehabilitating affordable housing targeted to low-income seniors, aged 60 and above. This new program is a welcome start to building for our aging population. NYHC worked with senior housing advocates to ensure dedicated senior housing funding was part of the statewide housing plan.
• NEW Upstate Public Housing– $125 million for substantial or moderate rehabilitation and/or the demolition and replacement through new construction of public housing authority developments outside of New York City. This funding is critical for PHAs to take advantage of HUD’s RAD program to revitalize public housing across the state. The budget bill also includes tenant protections and notification requirements strengthening provisions in HUD’s RAD program.
• NEW Low Income Affordable Housing Preservation & Development Program– $100 million for the preservation, restoration or creation of affordable housing units in a city with a population of a million or more. Priority will be given to not-for-profits with prior experience in community development projects. This is a new preference for dedicated funding with a non-profit preference.
• Rural and Urban Community Investment Fund (CIF)– $79.5 million for mixed-use affordable housing developments that may include retail, commercial or community development components.
• Mitchell-Lama Rehabilitation– $114.5 million to preserve and improve Mitchell-Lama properties throughout the State.
• NEW Small Building Construction– $62.5 million for rehabilitation and/or the demolition and replacement through new construction of buildings of 5 to 40 units. This is an important program for hard-to-finance buildings and reflects another NYHC priority.
• Homeownership– $41.5 million for promoting homeownership among families of low and moderate income and stimulating the development, stabilization, and preservation of New York communities.
• Mobile and Manufactured Homes– $14 million for mobile and manufactured home programs. New provisions are also established outlining the program’s replacement contract requirements and restrictions, Energy Star mandates, and financial assistance format details.
• NEW Community Restoration Fund– $1 million to facilitate the development of nonprofit community land trusts. This is a new program taking advantage of the potential land trusts have to create affordable rental and homeownership opportunities.
• Main Street Programs– $14.2 million for stimulating reinvestment in properties located within mixed-use commercial districts located in urban, small town, and rural areas of the State.
Additional Transparency
Homes & Community Renewal is subject to a new annual Housing Plan reporting requirement. HCR must provide a detailed annual report to the Legislature and Director of the Budget of projects and activities undertaken until the final disbursement of those funds has occurred.