Chap Crossing Affordable Units Part of Race to Comply With Settlement
The criteria for getting affordable housing in Westchester development projects is a complicated formula and time is of the essence, a county housing official told New Castle officials at the town’s Aug. 26 planning board meeting.
The planning board is currently hearing proposals for the Chappaqua Crossing retail project, which still requires site plan approval. The project now includes up to 32 affordable units in the old Reader’s Digest cupola building.
“If there is one takeaway from this, understand that there is no one-size-fits-all,” Norma Drummond, the county’s deputy commissioner for planning told the board last week. “We have single condos, single-family houses, two-family houses, all the way up to developments that are 93 units.”
A 93-unit development has two floors of affordable housing in the Town of Cortlandt. The county received permission from federal housing monitor James Johnson to create 15 affordable units at the location because it was near the Montrose VA, she said.
Chappaqua Crossing developer Summit/Greenfield is looking to place affordable housing units in the third and fourth stories of the signature cupola building on the sprawling campus formerly owned by Reader’s Digest, said the applicant’s attorney John Marwell. An earlier plan had affordable units in the east village portion of the project near the market-rate housing.
The affordable housing settlement, reached by former county executive Andrew Spano with the U.S. Department of Housing and Urban Development (HUD) and approved by the Board of Legislators in 2009, requires 750 affordable units be built by Dec. 31, 2016. Under the settlement, at least half of those units must be rental, and no more than 50 percent can be home ownership. The location of a property is a major factor in determining whether it meets the settlement’s requirements, Drummond said.
“The administration does not believe the monitor has the right to approve units,” Drummond said. “We advise the monitor when we are using funding on certain units, but we do not believe that the monitor actually has approval. The settlement agreement itself stipulates what is eligible, where and what types of units they need to be.”
Drummond said some of the projects with affordable housing units that have been approved may not count toward the 750-unit requirement because they don’t meet all the benchmarks, such as having financing and building permits in place by the 2016 deadline. Financing for 600 units must be in place by the end of this year.
“There is a time clock ticking for the ability for any units in Chappaqua to count because of that, especially when you’re talking about new construction,” Drummond said. “If you start digging in the ground and there’s another winter like last year your ability to get started this year will be somewhat limited.”
Board members voiced concerns that the project’s affordable units were concentrated in one building. Drummond said that arrangement is not unusual and that the affordable units had always been intended to be in a single building. Services and amenities for those units are different than other units, and had lower fees to increase affordability.
Mixing affordable rental and market sale units also has other consequences, she explained.
“You limit the ability of the people purchasing the market-rate homes to get mortgages because Fannie Mae may not buy their mortgage in a secondary market if more than 10 percent of units in any building are rental,” Drummond said.
Low-income tax credits, the main source of funding available to developers to build affordable housing, are less valuable to developers if they are used for building less than 35 affordable units, Drummond said. The same level of review is required for those investors, who must weigh whether they are buying credits for 35, 50, 75 or 125 units.
“It’s the same transaction cost, so your ability to spread them out over the number of units diminishes the ability of an affordable development to be affordable once you get below 35 units. Your ability to put an on-site manager there really diminishes once you get below 50 units.”
The New Castle Planning Board will continue its review of the Chappaqua Crossing retail project at its September meeting.
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