Housing funding in short supply
News that the cost of Westchester County”™s fair housing settlement had ballooned by almost $25 million and could rise by another $43 million did not come as a surprise to Peekskill Mayor Mary Foster.
In fact, the mayor said Peekskill, which is not one of the targeted 31 communities in which Westchester must build 750 units of affordable housing per the original $51.6-million court settlement, believed early on it could go begging for county funding due to the court case.
“It doesn”™t surprise me that the cost of the overall program is increasing because the settlement looks to build affordable housing in communities that aren”™t really anxious to build a lot of residential units to begin with,” Foster said.
Therefore, affordable rental units will not be developed as part of larger market-rate housing in these communities, but as more expensive stand-alone units, if at all.
Foster pointed to at least two affordable housing projects that have encountered delays due in part to the court settlement reached in 2009 as well as the prolonged soft housing market.
“The projects are in jeopardy because of the housing settlement. They are really in limbo,” she said, “and the longer they are in limbo the more developers may decide they are really not interested in doing them.”
The second phase of the city”™s Arts Lofts project in downtown Peekskill on Main Street calls for 16 units of live-work lofts and several thousand square feet of retail space. The estimated $7 million project was originally to be developed by Community Preservation Corp., which has since handed the reins to the Sisca Group of Brewster. The mayor said the developer had some contact with Westchester County regarding possible funding but no agreement had been ironed out.
Foster said the project has not moved forward due in part to financing issues, including the lack of county funding.
Another affordable housing plan ”“ the Gateway Project ”“ on Main Street is also on the shelf. There have been a number of proposals for the project, including Ginsburg Development Corp.”™s offer to build some 15 affordable housing units at cost for the city in conjunction with its planned market-rate development at The Abbey at Fort Hill nearby. That $3.6-million proposal was not projecting any county funding, Foster said.
Regan Development of Ardsley has proposed to build 24 affordable units at the Gateway property but that would require county and state funding, she said.
Westchester County provided some Community Development Block Grant funding for the purchase of the land for the Gateway project some years back. No further county funding commitments have been made, she said.
“Those infill projects are all on hold because it is very unclear whether there will be any county money flexible enough and adequate enough to fit the design criteria of these units,” she said.
Officials with the Astorino administration previously told the Business Journal the county may have to tap into affordable housing funds that were earmarked for projects outside of the court case settlement and in non-targeted communities.
Foster said members of the Westchester County Planning Department told the city several years ago county funding for affordable housing outside of the court settlement was an issue. Based on those statements, the city informed developers interested in building affordable housing in the city not to expect much assistance from the county.
“For projects that they had not already signed contracts on, they (county officials) did not know how much money they could allocate for future affordable housing projects in ineligible communities until they had a better handle on what was going to be needed for the housing settlement agreement,” the mayor said.
Westchester County Executive Robert Astorino after a meeting with U.S. Department of Housing and Urban Development Secretary Shaun Donovan on July 27 said HUD told the county the settlement agreement”™s cost is “open-ended” and therefore could go much higher and that the county must build the mandated 750 units.
Another city exempt from the court settlement, Mount Vernon, has also complained about funding of affordable housing projects. City, business and church leaders recently called on Astorino to free up some $4 million in county financing for a 14-story, $58.5-million residential development at 203 Gramatan Ave. The project is being developed by Atlantic Development Group, which had hoped to begin construction this summer.
Last year Astorino told the developer the project was not cost-efficient and the county would not commit funds that had been pledged by the administration of former County Executive Andrew J. Spano. Astorino later vetoed the spending item in the 2011 county budget.
George Oros, Astorino”™s chief of staff, has said the county must focus its bonding for housing projects to comply with the federal settlement.
“There isn”™t this pot of gold set aside,” Oros said. “We do have to focus on the settlement areas.”
The county Board of Legislators overrode Astorino”™s veto and restored the Mount Vernon appropriation to its adopted budget. In May a bipartisan majority of legislators approved $3.71 million in New Homes Land Acquisition funds to finance the affordable-housing portion of the Atlantic project.
Project supporters, though, say Astorino has since held up the county bonding for the project with what county Legislator Lyndon Williams, a Mount Vernon Democrat and board vice chairman, called “foot-dragging tactics” and “false claims of procedural oversights.”
John Golden contributed to this report.