Low and Moderate Income Housing Development Task Force

Monday, July 31, 2023 - 11:00 am

Jim Monty - Chairman

Chairman Monty called this task force to order at 11:00 am with the following in attendance: Clayton Barber, Robin DeLoria, Stephanie DeZalia, Derek Doty, Ken Hughes, Jim Monty, Tom Scozzafava, Matt Stanley, Joe Pete Wilson, Meg Wood, Mike Mascarenas, Megan Murphy, Carol Calabrese, and Laurel Polttila. Mike Diskin, and Alan Jones were absent.

Also present: - Kevin Kavanagh, Jim Dougan, Caitlyn Wargo and Dina Garvey.

MONTY: Good morning, thank you for coming this morning, I appreciate it. We were supposed to have a guest this morning, Mr. Kevin Kavanagh, I don’t see him, so we’ll get started here in the interim. Ken, would you like to give a brief update on the NACo conference, for the ones that weren’t here, that you attended in Texas.

HUGHES: Yeah, sure, absolutely, thank you.

So, good morning, everyone. I was, I just returned from Austin, Texas, when the National Association of Counties held their annual conference and at this conference these two documents were released by the task force. The task force was about 30 individuals from New York State down to Florida, Alaska, California and everywhere in-between. We had been meeting since November of 2022 on the topic of affordable housing all throughout the United States and so we met with many industry experts. We had conversations with many leaders from across the country, about housing, about financing, about zoning, about any number of housing topics and through the collaboration of NACo and the task force, these two documents were created. I just want to draw your attention to the thicker of the two documents; which is Best Practices and Policy Recommendations, this is a document for me as a town and county executive, really hits home for me, in that it’s not just ideas that could be done, but it tells you where they actually are being done throughout the country. So, for example, if you have it in front of you, if you turn to page 17, this is where our Essex County Land Bank was highlighted as a best practice example for the Federal and County intergovernmental nexus. So, the task force understood that conversations between county governments and the federal government are imperative to our housing success and because we had a seat at the table I was able to share with my other colleagues at the task force the great work that the Essex County Land Bank has been doing and is expected to do. They were very excited and pleased about those opportunities and so that’s why it made this documents. There are 3,069 counties, boroughs and parishes all throughout the United States and all 3,069 are going to be receiving these documents. So, I’m very pleased for Essex County. I’m very pleased for our Land Bank, because if we didn’t have that we probably wouldn’t be involved in this document and I’m grateful to Chairman Monty and Chairman Gillilland for the opportunity to send me to Washington DC, Dallas, Texas and Austin, Texas to learn and listen and participate in the conversations that lead to these two documents that you have in front of you. There’s a lot to digest in these documents and if you have any questions at any time I would be more than happy to speak with anybody about them or put you in contact with anybody from the task force and I am grateful to have had the opportunity to learn a little more about affordable housing throughout the United States.

MONTY: Thank you. Any questions or any thoughts?

DOTY: Ken, I just have a couple of questions. How many levels of affordability or workforce housing was addressed? You know, we have low income, we have that gap that we always talk about, the people that don’t have the 20%-30% down, what kind of help is out there for a blue collar husband and wife or family for homeownership? That seems to be that recognized gap that no one seems to be able to solve.

HUGHES: Great question, definitely brought up by the task force members because every county throughout the country has those challenges, has that segment of citizens who are in that low-moderate income threshold area and so every commissioner, every supervisor is talking about where does the funding come from? Where are the resources that are available? How do we make sure that those two can get together and actually provide some workable results? So, the levels are definitely low-moderate income, 80% - 120% AMI was generally the conversation and honestly it’s hard to answer the second part without saying looking at the actually recommendations that the task force put together. Because is where you’re going to see, because what’s good for Juno, Alaska might be different than Baltimore, Maryland and different for Essex County, you know and so there’s no one size fits all and that’s why the document is 30-pages long, because what’s good for an urban county is different than a suburban county versus a rural county, so I can’t give you a specific answer to your question, it’s great question. Definitely, encourage you to take a peek in there and see.

MONTY: And I think a lot of it, again, your federal income guidelines are different then your state income guidelines. So, every state in the country has different poverty level guidelines. The federal guidelines are atrocity low.

HUGHES: And I will tell you, if I was challenged by this process, it was just that, trying to like at the federal level. I talk about the Adirondack Park all day long, but the person who lives in Pinellas County, Florida does not give a hoot about the Adirondack Park, just like we don’t necessarily care about the Outer Banks. It was hard to swallow the vastest of the different challenges that everybody has in this country and try to and create guidelines that were an umbrella on that to kind of touch everybody in that kind of berth and this recommendation guide, actually did go into the depth, because it did point out specific areas of the country that great ideas were already happening. So, that was a big challenge for me was, you know you can talk about the county, talk about the state, but to really look at it federally, first time out, it was hard.

MONTY: And a lot of the Federally funded, Federal guidelines for different programs are much different than the State guidelines. If you remember a few weeks ago, I discussed with you the Federal guidelines for Head Start. How many people who aren’t even to our minimum guidelines, because it’s a Federally funded program, they fall through the cracks, because it’s a Federally funded program. So, if they’re making $2,000.00 a month, you’re qualifying for just about everything that Essex County and the State has, Federal Government, you don’t qualify for anything and if it’s a Federally funded project, they’re not qualified for it. That’s what is really jeopardizing Head Start in Essex County. I think Mike can talk to that and some of the other programs.

MASCARENAS: Yeah, absolutely, you’re right, it’s all over the board and every program to program depending on every as the State funnels these dollars through. SNAP’s different than HEAP is different from Medicaid and all those things. So, it is challenging to know and just think how confused the consumer is, without having that one stop shop of somebody that knows it all. So, you might stop at ACAP and then you stop at DSS and you stop down at Public Health for WIC and you run through the gamete in terms of how you can even access services can be problematic and let alone qualify for.

MONTY: Yeah, it’s a tough thing, but something we have to navigate and thank you, Ken, again for attending these. It’s great information and it’s nice to know that we’re recognized on a national level with what we’re trying to do in Essex County. Whether we can succeed, I think we’ve succeed just by forming a land bank and getting started. So, one step at a time in that regard.

Megan, is there anything you can share with us at of our meeting with Mr. Kavanagh?

MURPHY: He’s got extensive experience with working with low income tax credit programs in New Jersey and so he was very interested, he has a second home up here in the Adirondacks in Schroon Lake and so he’s been very interested in finding out what’s going on in housing in this area and seeing how he can lend his expertise and so we did meet and we had some great discussion, so I am really glad that he is now here today, because I think he will be a fantastic resource for us in navigating the concept of low income tax credits.

Kavanagh: Hello everybody, my name is Kevin Kavanagh and I am interested in developing affordable housing in Essex County and the vehicle for doing this would be affordable workforce housing and I have a contract out on a piece of land in Schroon Lake and I would like to combine that with another development somewhere else in Essex County and I’m looking for alternatives. The low income housing tax credit is really a necessary vehicle to finance affordable housing in the county. The way it would work and I have approval from the state allocating agency to structure and deal this way would be to combine, because you can’t, because the population centers are not so great in any one of the individual towns, like in Schroon Lake, when I’m from, you can’t really drop 70-units of workforce housing in Schroon Lake and that’s sort of the size that you need to attract a national investor to purchase credits and the state allocating agency has given me the ruling, basically, saying that I can combine two developments in two separate towns to one tax credit application and the reason that makes sense is that you would be able to get the size and scale you would need to attract a national investor and so I don’t know where we started, so I am flying a little blind as to what questions might be out there and what any concerns are.

MONTY: Could you just explain to us the process, you talk about Schroon Lake, you have a project in the works in Schroon Lake, what that entails, what it’s going to be, how you came about getting it set up and done.

KAVANAGH: So, it’s not done, I wish it were. I actually heard back from the realtor this morning and the offer I put in is being considered by the owners and so what I thinking, there’s a 10 acre site, right on Route 9, not far out of town. It’s a nice, it’s a further out of town than I would have hoped, just for walkability and all of those concerns, but that’s what is available at the moment and so I am thinking about 30 units there. It’s zoned for 20 and I think maybe I can get 30 there and I am hoping to find another site in Essex County for another 20-30 units and I think that’s achievable, but I don’t have the other site yet, so that’s what I’m looking for.

MONTY: So, you obviously find funding to come in and develop that.

KAVANAGH: Right, yeah, so that’s one of the reason that the whole thing makes a lot of sense to me. I looked and because of these, so called, low income housing tax credit are a federal resource, they get allocated per capita basis to every state and because it’s a federal resource the state allocating agency in Albany has an obligation to distribute them evenly around the state and last year, for example, there was only one application in this region, which they call the north country in Tupper Lake, which was 70 units of workforce housing there and that’s part of a larger development, but the point is they had one application last year and the person who’s responsible for allocating credits said they would like to 4-5 developments up here and I know there’s Reagan Development, I think, has something planned in Ticonderoga and there’s possibly one other potential application, but mine would be a 3^rd, so it would be a safe position and I think there’s another lane, really, for getting the funding and so that would provide roughly 80% of the capital projects, a $15 million project it would fund and because the rent structures are essentially held back, you might say, restricted by incomes, the project wouldn’t support a lot of debt and that’s sort of by nature. So, you don’t put a lot of debt on it, so you can afford to charge lower rents and then I would be seeking some other subsidy familiar to gap subsidy to fill the gap and this is a very common structure. I have been with it for 25 years.

GILLILLAND: Are there any, you mentioned 10 acres, are there other requirements. I heard something else and I can’t pinpoint it, but like walkability or access to health care facilities, access to grocery stores.

KAVANAGH: Right, all that stuff is important and you know the more you have of it the better your better your application. So, it’s a competitive process, but like I said, they’re looking to fund 4-5 developments in the North Country and there’s only two on the horizon that I know of and so the things like walkability, good school systems, building quality, they’re promoting green features, so really tight insulation, good building systems and that sort of thing. So, there are a number of things that go, they want to make sure it’s a clean site, no environmental contamination. Those are the main and then obviously the support the county and the town. They want to make sure they’re allocating the funds to places that want the development to happen.

DOTY: Kevin, is there a limit to the number of federal accepted applications within a given area? You know, you talk about Reagan, we are benefactors in North Elba of a 60-unit, so is there a competition, so to speak for a certain number of accepted applications within a given area?

KAVANAGH: So, yeah, so last year there were 50 applications in upstate New York and, all of New York and I think 35 got funded.

DOTY: Okay

KAVANAGH: It’s a competition, but because they have to allocate it annually among all the regions as they rank them up.

DOTY: And you suggested that 30-units could go in Schroon, so that would leave you 30-units to qualify in another area of the North Country or Essex County?

KAVANAGH: Yeah, well would prefer to and that’s a reason why I think you don’t see a lot of the bigger developers come in, because we have to do these sort of gymnastics to make this development work, unless you’re Lake Placid.

SCOZZAFAVA: So, try to understand, so these would be rentals? You’re not building these to sell?

KAVANUGH: These would be rental units, I would, for everything that I am buying I would retain ownership.

SCOZZAFAVA: Okay, so Section 8 Housing would fall into this, I’m sure, right?

KAVANAGH: So, yes, one of the requirements is that you stratify the rents that are available, you have to make units available to people of range of incomes up to 60% of AMI. AMI is determined by county. It is the HUD designation. We think Essex County last year, the median income was $76,000.00 and it’s based on family size, so the more people you have, the more income you’re allowed. So, we would be targeting, the highest income folks would be, say a family of four making $60,000.00 a year and then we’d also be, have units available to people below 30% of AMI. So, you’re getting to sort of poverty area in terms of incomes and those tenants would be, they would benefit from the vouchers and the reasons that’s important is that essentially makes them 60% AMI families, which means you can support a little more debt to help finance the project. So, we can underwrite the voucher income.

SCOZZAFAVA: So, these would be one, two, three bedroom units, I’m assuming?

KAVANAGH: Yeah, there’s a distribution that’s required by the State, so you can have too few three bedrooms and you can’t have too many two bedrooms.

SCOZZAFAVA: So, infrastructure, obviously pays a critical role in this, municipal water and sewer.

KAVANAGH: Yeah, the site that I have a contract on has municipal, but it would have to septic.

SCOZZAFAVA: So, the family of four that’s making $70,000.00, who can no way out and afford to buy a house in today’s market.

KAVANAGH: True

SCOZZAFAVA: Really not doing anything for them.

KAVANAGH: Well, there is an option, they have allowed change to the way that IRS treats this, but they have up to 90% of AMI, as long as the total balance, so in total the rents are on average 60%. So, when we have a 90% it will balance that lower income family and as long as the average is less than 60% AMI.

SCOZZAFAVA: So, property tax, do you go for pilots?

KAVANAGH: Yes, that’s part of it.

SCOZZAFAVA: School, town, county?

KAVANAGH: Yes, so it would be a pilot and that can be, I haven’t done one in New York, but the way we handle it in New Jersey is there’s still going to be a payment coming in. So, right now the taxes on the parcel that I am looking on, is $10,000.00.

SCOZZAFAVA: It’s vacant land, correct?

KAVANAGH: It used to be a hotel site and so the estimated pilot would be, I don’t know what it is, but it usually ends up being about $30,000.00.

SCOZZAFAVA: New York State it’s a 10 year program, I believe.

KAVANAGH: Right, it scales back, but that’s more of a measure that the State uses to gauge the support of local government. Because, of the certain open lane nature of this, it becomes a little less important, but I would still be seeking it.

SCOZZAFAVA: Thank you

HUGHES: You mentioned something about the site was zoned for 20, but you were thinking you could get 30, could you talk a little bit more about that?

KAVANAGH: Sure, I will seeking a variance.

HUGHES: The Town of Schroon’s ZBA or something like that?

KAVANAGH: Yeah, I’ve been told that I need to go to the planning and to the zoning board of appeals.

HUGHES: Okay

MONTY: Now, early on you mentioned the funding is, is it primarily federal, but it comes through the State. Is it HCR, OCR, who is the regulatory agency that that money comes from?

KAVANAGH: It’s HCR, but it is, it’s federal resources, it’s allocated through the State on per capita basis. So, if they are 20 million people in New York, the current rate is something like $2.50 per person, so it works out to $40 million rough, annual funding and it get complicated after that, and it’s not really $40 million, it’s more like $400, but it’s a long story, it’s allocated over 10 years.

HUGHES: What happens if the ZBA and the Town of Schroon denies your variance request?

KAVANAGH: I’m done.

HUGHES: You’re done?

SCOZZAFAVA: Quick answer

KAVANAGH: Yeah, they’ve been very supportive, I’ve spoken with the town administrative and members of the board and some local folks and because there’s such a need for workforce housing up here, everybody has been supportive that I have spoken to, so far.

MONTY: Any other questions?

DOTY: Kevin, does you development company provide the maintenance after it’s built?

KAVANAGH: Yes, so there are escrow built in to cover any principal and interest shortfalls, there’s a working capital and a replacement reserve account designed to do that. The whole thing is, we have to operate it as responsible landlords.

DOTY: So, you have an on premise manager, as well?

KAVANAGH: Yeah, yeah there’s on premise manager and then the State has a regulatory arm that comes in and all the tenants are income qualified and everything is up to code, that happens. I don’t know when the State does it, at least every three years.

SCOZZFAVA: Are these attached units?

KAVANAGH: So, I haven’t designed it yet. I would like to have a contract before I start releasing architects, but, yeah. My idea was to, you know, it’s a 10-acre site, unfortunately it backs up to the Northway, but it’s pretty well screened. So, the idea is to keep it’s, it’s between Route 9 and the Northway on the north side of town.

SCOZZAFAVA: This is similar to a large scale, it think Mountain Meadows. There is one in Schroon Lake, we have one in Port Henry, there is one out here in Elizabethtown.

KAVANAGH: Right

SCOZZAFAVA: They do an excellent job. They are good landlords. They take care of the property very well.

KAVANAGH: Yeah, that’s the idea, is you want to provide good livable space that everybody can be proud of and the idea is to have someone that would be offering services to the tenants, in terms of social services and trying to connect them with the existing social services and then also there will be a community room on-site and we’ll put some computers in there.

SCOZZAFAVA: I am assuming you’ve been out scouting, have you looked in any other towns. Do I have a deal for you. There’s a couple of large parcels in the hamlet areas.

KAVANAGH: I have been looking around, but you guys know way more about what’s available and what’s developable than I do. So, I welcome any suggestions that anybody has as to parcels. You know, ideally, close to town, close to shopping, walkable that’s the ideal.

MONTY: Any other questions? Anything else for us, Mr. Kavanagh?

KAVANAGH: No, I just thank you for the opportunity to be here and I apologize for being late.

MONTY: That’s fine, Megan was giving us a briefing of your meeting with her a couple of weeks ago.

KAVANAGH: Great

MASCARENAS: Mr. Kavanagh, If it’s not too much trouble, could we get your contact information, just in case something pops up on our Board’s radar?

KAVANAGH: Sure.

MASCARENAS: I mean every town’s represented here, we could get that information to them if there’s property or something, they could shoot to you, just to see what you think.

KAVANAGH: Yeah, absolutely.

MONTY: If you send it to Shaun’s email and then Shaun can disseminate it to everybody else.

Laurel, would you like to update us on where we may be on our BHSN grant?

POLTTILA: Yeah, sure, I don’t have too much to update. It seems like summer is vacation for everyone, so we’re kind of staggering out, but we do have some kind of exciting pieces. We are going to be meeting with the owner of the property that is in Mineville. It looks like we’re going to be meeting with Chris from Housing Visions, hopefully this week, so that’s the only update of that conversation, kind of see where we go with that.

MONTY: Are you included in that, Tom.

SCOZZAFAVA: I’ve gotten calls from different people on the project. Have you been to the building, yet?

POLTTILA: No, I have not.

SCOZZAFAVA: And then the individual that bought the old hospital, which is right next door to it, Steve Cross, he’s also said he would be interested. He planned on doing housing in that building.

POLTTILA: That’s great, if they’re interested, I’ll let Chris know that, because he asked me that question.

MONTY: Any questions?

Does anyone want to get us an update on anything at this time?

MASCARENAS: I just one thought and it’s kind of silly, but if I don’t say it I’ll forget it before the next time we meet. Recently we’ve been talking a lot about, we heard it at the regular board meeting today, the APA and the restrictions that we have in terms of zoning and we can try and improve our housing stock or extend our housing stock and I am almost thinking that we need to change the language in terms of how we approach and maybe it’s not an extension of a hamlet that we know is real problematic in terms of the APA and trying to get those types of things accomplished. But, maybe as the Governor’s looking at this housing crisis that they have and going to be pushing legislation out next year, maybe we talk about housing, zoning specifically and how do we get permission around looking at that. So, maybe we look at some many acres of land in communities that we could develop zoning on. Not necessarily ask them to amend their constitution or amend hamlet designation, but let’s specifically look at consultants and go around the County and try and identify areas that we could somehow fit zoning in for housing and maybe just that change of conversation and how we approach it, instead of pounding our fist and saying, they’ve got to let us do this, but try and work with them a little bit better in changing the language and how we approach it might be a little wiser and like I said, I simply don’t want to think the thought.

SCOZZAFAVA: I think that’s an excellent suggestion and then, you live in a moderate intensity area, when we put sewer down Tarbell Hill back in the ‘80s, the late ‘80s, that was all moderate intensity. You could do a hamlet extension, they allowed us to and I know we’ve got other areas there, where we have wastewater that are moderate intensity areas, so you don’t necessarily need the hamlet expansion. We had to work them to get, they wanted the infrastructure, too. It’s a good suggestion.

MONTY: Speak to the Town of Westport, because they were denied two hamlet extensions on low intensity property.

SCOZZAFAVA: This was moderate, it wasn’t low.

MONTY: This was, too.

SCOZZAFAVA: Grover Hills, which is the condense populated area in the entire Adirondack Park, you know what it’s zoned? Moderate intensity.

CALABRESE: Just one thing, from the last time we met, we had talked about potential, looking for funding for a housing study and I just went back and touched base with Beth Gilles at the Regional and I did circulate out a link. They just completed the 3 county, Franklin, Essex and Clinton County study. It’s right on their website. I sent the link out so that you guys can see it, it’s almost a 300 page document, however it does allow you to go in and drill down, town by town, so that you can get some specific statistics on your community, so I think it’s really beneficial as a planning tool, especially looking for funding. If you didn’t get it, I would be happy to send it back out again, so that you all can see it. The hard work as far that finding funding and putting the plan the together as been done for us. So, I’ve read it myself, but I think, I don’t know if either Nicole, you’ve seen it and read it or not, but it’s a really well written document and it’s current. This is the one that they just revealed in May.

MURPHY: They do have 10 strategies in there and thinking about zoning is one of them. Working with the planning and zoning officers and their strategies. It is a good start, it is, those strategies come from the four counties, so there may or may not be things in the 10 strategies that really direct for Essex County. What we might want to do is think about how do we prioritize that think about how we actual start enacting it and they have actually started doing some work on getting some funding. I supported a grant application to the Northern Border Regional Commission and I also supported another one which is a member item, to Senator, I think Gillibrand picked it up. So, she’s been starting to work on how do we start to fund some of these. I do think they are also going to put together some task forces, but again, that’s going to be focused on four counties. If we wanted to do something here, I can maybe getting a little bit of funding for us to think about how do we prioritize here and find the best tools that we have in the county to move forward.

CALABRESE: I think we would be able to pull, as Megan said, there’s ten prioritizes right in front, right in the very beginning and Ken described earlier, not every strategy is meant for every town or every county, but this is kind of the low hanging fruit, right now, that maybe if we have the task force assessing goals, that we can actually start to implement with key people at the table.

HUGHES: I am just going to coattail, because last time we met we had put together, many of us contributed to a list of what’s next, right the land bank is done, we’re in process, what’s the next mandate, strategies that were listed in that document and I would like to know what we’re going to focus next. It sounds like zoning is a topic of interest, but what is our next task? What are we focusing on collectively or do we divide and conquer on a couple of tasks? But, everything that was just mentioned is on that document from last month.

MONTY: My thought on that, I agree wholeheartedly, Ken, but I would like to see us limit what we’re working on to one or two, because if we start working on too many.

HUGHES: I agree

MONTY: You end up with ten finished products and nothing done.

HUGHES: I was thinking the same.

DELORIA: I can speak to Newcomb’s zoning laws just to maybe to people that don’t have zoning laws to help you understand what’s happened when they adopted this back in the early ‘70s. Essentially, what they do they take what they want you call the hamlet and that whole area maybe a ½ acre or a one acre subdivision and then that would stand out within your community. You’re getting into the outside perimeter, which are concerned with land conservation, well land conservation for Newcomb is a 40- acre subdivision; okay? And I was going to speak to this earlier then Steve brought up these people that want to feel like they’re going to work with us, I don’t see that happening. If you remember the conservation that went down to Albany, twice and got shot down. That would have taken one particular in our town, that we have it zoned for a 3.1 subdivision and it would have made it 20. So, it’s essentially a taking of someone’s property, devaluing it to limit growth and that’s what these groups are all about. They don’t want growth in our communities. If we don’t figure how to change our zoning and get Park Agency approval, if you need it to create larger areas of habitation then our communities are going ___________, because you’re beating back to them. It’s just my thought on that.

CALABRESE: So, just you are aware that the community that worked on the housing plan, Dan Keller from the APA was on that committee and was very active.

MONTY: Maybe sometime we should invite him here to discuss these things. Actually, maybe we discuss that at our next meeting and invite him to come to it.

CALABRESE: I have mentioned this committee to him, when I have run to him. So, he was receptive to when you want to invite him.

MONTY: I’ve been also in contact with Senator Stec, Assemblyman Simpson, and Assemblyman Jones, who are very interested in what we’re doing here and they want to come to a meeting, but maybe if we had the gentleman from the Park Agency and them here to hear our concerns, that might not be a bad idea. Send me his contact info, I probably have it and I can send out an invitation.

CALABRESE: Will do

MONTY: I know a lot of times our concerns fall on deaf ears when it comes to Albany, but knowing anything about me, I got a pretty hard head and stuff and I’m still going to knock on that door and stuff, until they at least give us a definite no or help us. That being said, if no one has anything else, I agree with Ken, with what Ken said, we need to also work on the zone issue.

If there is nothing else, I want to thank you and we will see you the end of August.

THERE WAS NO FURTHER BUSINESS TO COME BEFORE THIS TASK FORCE WAS ADJOURNED AT 11:47 PM.

Respectively Submitted,

Dina Garvey, Deputy Clerk

Board of Supervisors