Gov. Kathy Hochul in her address on her proposed Fiscal Year 2024 Executive Budget on Feb. 1 outlined her “New York Housing Compact” that looks to address t

ALBANY—Gov. Kathy Hochul in her address on her proposed Fiscal Year 2024 Executive Budget on Feb. 1 outlined her “New York Housing Compact” that looks to address the housing shortage in New York State by building 800,000 new homes over the next decade.

The plan sets housing target growth rates at 3% for downstate municipalities and 1% for upstate communities. The plan also provides incentives to facilitate transit-oriented development, removes barriers to housing creation, and incentivizes new construction.

The governor’s budget also had some welcome news for New York City developers as she has proposed extending the expired 421-a construction deadline through 2030. Currently, the deadline would mandate all construction that would fall under the tax exemption be completed by June 2026.

“I’m committed to doing everything in my power to make the Empire State a more affordable, more livable, safer place for all New Yorkers,” Gov. Hochul said. “We will make bold, transformative investments that lift up New Yorkers while maintaining solid fiscal footing in uncertain times.”

Other key facets of the governor’s New York Housing Compact are:

• $250 million for infrastructure upgrades and improvements to support local housing growth and development.

• $20 million for planning and technical assistance to support local rezoning efforts and other solutions to drive growth.

• $15 million for a new statewide data collection effort.

• $4 million to create a new Housing Planning Office within Homes and Community Renewal to support localities in meeting their housing goals and coordinate planning efforts across the state.

• $39.8 million to reduce the risk of lead exposure in rental properties outside of New York City, including $20 million in assistance to property owners for building remediation, and

• $50 million for the creation of a statewide Homeowner Stabilization Fund to provide critical home repairs in 10 key communities with a high concentration of low-income homeowners of color.

The budget also expands HCR’s Tenant Protection Unit as part of a multi-year investment to provide targeted support for tenants in upstate New York.

The governor, who also highlighted a host of crime-reduction, health care and infrastructure initiatives, also proposed earmarking some of the revenues from downstate casinos to the beleaguered MTA. Her budget specifically calls for dedicating a share of $1.5 billion in the licensing fees if three casino licenses are awarded, and a share of an estimated $462 million to $826 million in annual tax revenue from the casinos for MTA operations. She is also proposing increasing the top rate of the Payroll Mobility Tax, which would generate an additional $800 million annually for the MTA.

Reaction from the business and real estate sectors was mostly positive. For example, Tony D’Anzica, President of the Hudson Gateway Association of Realtors, termed the governor’s compact plan: “a common-sense approach to dealing with the lack of housing and housing affordability at the same time.”

D’Anzica noted that he supports the proposal to extend the 421a tax exemption construction deadline through 2030.

“With respect to The New York Housing Compact, I would say that it clearly recognizes that there is a public housing crisis in terms of both supply and affordability. Local communities need more tools and incentives that encourage the development of housing models that are more affordable, cost effective, sustainable and transit-oriented,” D’Anzica said. “While the New York Housing Compact is a step forward, many details are still missing. Dealing with these issues requires a dialogue and a close collaboration between both the state and all local communities to address the barriers and delays preventing the development of new and affordable housing.”

Timothy Foley, CEO and Executive Vice President of the Building and Realty Institute (BRI) and member of the Welcome Home Westchester campaign, said, “Westchester County is the poster child for why we need state leadership to help us through our housing shortage. We have so many communities like Ossining, Mamaroneck, Peekskill, Mount Vernon and others that have created transit-oriented developments that are climate-friendly, millennial- and senior-friendly, and have helped revitalize their downtowns, stabilize property taxes, and boost their local economies. We’ve also seen a handful of villages and towns move forward with thoughtful proposals to allow for accessory dwelling units. But just this month, we’ve also seen Greenburgh slam the breaks on the development of moderate-to-affordable condos and co-ops by increasing property taxes on them and Pleasantville enact a moratorium on building housing not to address a specific problem with schools or parking near the train station or some other identifiable issue, but simply because the loudest voices of the community demanded it.”

He added, “The governor’s approach offers a lot of options for municipalities to choose from, but the important point is that everyone needs to be part of the solution. ‘The way things have always been done’ is what got us into this mess. It’s time for something new.”

Carlo A. Scissura, Esq., President and CEO of the New York Building Congress also offered high praise for the governor’s proposed Executive Budget. “Gov. Hochul’s executive budget is infrastructure and housing forward, addressing today’s critical issues and continuing to move us toward more growth, fairness, and opportunity in the year ahead,” he said. “The governor rightly prioritizes initiatives that the Building Congress has long advocated for, including the extension of the 421-a tax abatement for affordable housing projects already underway and new incentives encouraging transit-oriented development across New York.”