NY program to pay homeowners to build accessory apartments

Nearly 20 years ago, Helen Boxwill transformed the garage of her Huntington Station ranch-style home into a rental apartment. The move, she said, has helped her pay taxes and other expenses while likely providing less expensive housing for people who might not be able to afford to live in the neighborhood. 

"It's been the best decision I made,” said Boxwill, 77, a retired educator who worked in the Huntington school district.

Many Long Island families hope to make a similar transition, but now some want to do it through New York's Plus One ADU Program. The statewide program aims to curb the affordable housing shortage by offering Long Island homeowners up to $125,000 in a forgivable loan to build or retrofit accessory dwelling units, also known as ADUs.

These smaller private residences share property with the larger homes and can come in many forms, including in a garage or basement, or be detached from the main residence.

Low- to moderate-income homeowners who live in the towns of Babylon, Brookhaven, Huntington, Shelter Island, Southampton and Southold can currently get the funding on Long Island. Other places where funds were awarded under the program include New York City and several localities in the Hudson Valley. Housing nonprofits and municipalities have partnered to apply for the funding, according to the state Division of Housing and Community Renewal.

The Town of Brookhaven currently has roughly 5,000 valid accessory apartment licenses, while Huntington has about 3,000 accessory apartments, officials said. The Town of Southampton has at least 152 accessory dwelling units, while the Town of Babylon has around 2,160. Shelter Island and Southold did not immediately provide information on ADUs.

More housing, affordable mortgages

Housing experts say the expansion of the units — which also go by names such as granny apartments or in-law units — can play a significant role in helping reverse the region's lack of affordable housing. The units, experts say, also can help maintain the suburban qualities of a neighborhood while making homeowners’ mortgage payments more affordable and providing housing for groups such as older relatives, a home care attendant or an adult child.

Gwen O'Shea — president and CEO of Community Development Long Island — one of two nonprofits tasked with helping area homeowners chosen in the program develop or retrofit the ADUs, said accessory apartments are a good place to start to help the area's increasing housing demands.

She said the Plus One ADU Program can also help "to ensure that homeowners who want to remain and stay in their home can."

More than 95% of zoned land in Nassau and Suffolk counties ban apartment buildings, Newsday reported previously, referencing the Long Island Zoning Atlas. But most Long Islanders at least want the option of more affordable housing, Newsday separately reported, citing a 2022 poll by nextLI/Newsday, in partnership with Productions Plus Research and Hofstra University.

Among 2,910 residents of Nassau and Suffolk surveyed, 68% said they wanted an increase in affordable housing, 19% said the current stock was acceptable, while 13% wanted a smaller amount, the article said. Meanwhile, roughly half of the participants said they wanted housing choices that were less dense. 

Questions raised

ADUs have come under fire over concerns such as parking, increased housing density and other quality-of-life issues.

Still, the state has awarded about $20 million to build them. With this funding, the program hopes to yield roughly 200 units across the state. Each Long Island town in the program receives $2 million each.

The next round of funding will make $30 million available,  and preliminary award selections are expected in March, according to the state.

 The funds come from $85 million set aside in the 2022-23 state budget as part of the state's housing plan, according to the state Division of Housing and Community Renewal. Funding for the program continues through the 2027 fiscal year.

To spur housing growth in the suburbs, Gov. Kathy Hochul said in January she wanted to make a "pro-housing" designation a requirement in order for localities to tap into to more than $650 million in discretionary funds. 

There are stipulations attached to receiving money through the Plus One ADU Program. Homeowners have to meet the income threshold — the area median income — or be below it, the state said. For instance, the Huntington application says a household of one can have a maximum allowable income of roughly $109,000, which goes up with the number of occupants. 

The home must be the primary residence of the owner, and there is a restrictive covenant for 10 years that is used to ensure the home remains the primary residence of the owner and the ADU is kept in good, habitable condition.

Compliance checks

The two nonprofits, as the awarded recipient agencies working with the state, will be checking in with the homeowners to make sure the properties meet health and safety codes for a 10-year period. The additional space can't be used for short-term rentals such as Airbnb.

Applicants must own the property and have considered it their principal residence for at least a year, be current on their mortgage and property taxes, and maintain homeowner’s insurance covering structure replacement, according to the program. 

The grants must be repaid only if the owner sells the property within the 10-year period to someone who does not meet the income threshold, the state said. And even if the homeowner has to pay some money back, it may be a pro-rated amount, O'Shea said.

Thus far, she added, the response to the program has been overwhelming.

The website for the Community Development Long Island — which is handling the towns of Babylon, Shelter Island and Southampton — notes the application is closed. In Southampton and Babylon, she said, the nonprofit has received more applications than they have resources.

The organization hopes to start construction of some of the units  in February.

Officials with the Long Island Housing Partnership, the other nonprofit facilitating the program on Long Island, said the group had received nearly 30 applications as of mid-December, mainly from people living in Brookhaven. The nonprofit is handling the towns of Brookhaven, Huntington and Southold.

The Plus One ADU Program comes to a region in which more than 29% of people with home mortgages are "cost-burdened," denoting that more than a third of their income goes to housing on a monthly basis, according to a Newsday article, citing data from the U.S. Census Bureau. 

ADU merits debated

It's also an area fraught with a history of disagreements over the merits of ADUs. Some Long Island municipalities prohibit them, but the region has plenty of examples to judge the value of accessory apartments.

In 1979, the Town of Babylon became among the early municipalities in the nation to pass an ordinance allowing accessory apartments, and Brookhaven and Islip later followed suit in the 1980s, according to a 2016 study from Hofstra University's National Center for Suburban Studies.

Some cities and villages in Nassau, including Freeport, Glen Cove, Long Beach and the Village of Hempstead, prohibit accessory apartments. Even in many places with housing ordinances permitting ADUs, there are often restrictions on size and who can live in the units. Riverhead allows accessory apartments, for example, but only when the owner lives there.

Huntington allows ADUs but not basement and attic apartments. A permit is required for an ADU regardless of whether it is to be used for family, to rent or for the owner, Huntington Town Supervisor Ed Smyth said. Homeowners are permitted to live in the ADU and rent out the main part of their home.

Yet, accessory apartments also have faced pushback from residents. Last year, at a contentious town hearing in Huntington over basement apartments, some speakers expressed concerns on issues such as code enforcement and traffic, Newsday reported. One speaker said the accessory apartments might change the "complexion" of the neighborhood, video of the meeting showed. 

Leon LaSpina, 50, a South Huntington resident who has advocated for the town to allow basement apartments, said accessory units offer low rent and can keep senior homeowners in the area.

“There are plenty of Long Islanders who leave because their pension gets them further in another state,” he said. “Perhaps, if they no longer need the entire house that they have lived in for years, an accessory apartment may allow them to stay in that space.”

Keeping workers local

Accessory apartments also can keep teachers' aides, school bus drivers and other essential low-wage workers from moving off Long Island, said Pilar Moya-Mancera, executive director of Housing Help Inc., a U.S. Department of Housing and Urban Development-certified counseling nonprofit with offices in Greenlawn and Central Islip.

“Who’s going to do that work?” Moya-Mancera asked. “Who can afford to stay making minimum wage or making little money?"

At least one locality has recently sought to expand ADUs. The East Hampton Town Board in 2023 approved a series of changes to the town code designed to add more ADUs by increasing incentives for homeowners and simplifying a process implemented in a 2016 pilot program.

The code change increased the maximum ADUs per school district from 20 to 40, for a maximum of 200 across the town. The number of bedrooms allowed also increased from one to two, among other changes.

O’Shea, of Community Development Long Island, spoke at the Nov. 14 East Hampton Town Board meeting about the Plus One ADU Program.

At the end of the presentation, East Hampton Councilman David Lys said, “I look forward to continuing the conversation because I do see a benefit that we can use long-term here.”

Traci Rivera-Renna, an expeditor who helps several families move through the process of building an ADU, said people run into obstacles while navigating the building permitting process. On top of that, she said, there are sometimes charges like upgrading sanitation systems that can cost a homeowner tens of thousands of dollars before they can build the unit.

"Not everybody has $35,000 sitting around just to install a sanitary system; that's before you even think about the construction needed on a house," she said.

Nonprofits assist 

This program seeks to get around some of those concerns by working closely with towns and homeowners to complete the accessory apartments.

O’Shea said the nonprofit will work with the homeowners to help them clear any outstanding permit violations. Then, they help the homeowners identify designs that could work for the property. For example, the person may want a stand-alone ADU, but their town might not allow that.

The homeowners can find their own contractors or depend on the nonprofit to help find them.

Boxwill, the retired educator, said she had to take out another mortgage on her house to pay for a new cesspool, appliances, heater and other items for the garage unit.

Over the years, Boxwill said, she has had three tenants, perhaps all able to stay and work locally for far less than with many other living arrangements. Her current tenant pays about $1,000 a month in rent. For that, they get a bedroom, kitchen, bathroom and a private entrance, and Boxwill gets help paying her taxes, estimated at around $9,000 annually.

She said most people — even some friends who have frequented the property — had not noticed an accessory apartment attached to the house, mostly because she has a fence and the unit has a private entrance.

When a neighbor raised concerns about the number of tenants moving in, Boxwill assuaged those fears by telling them she was staying and that the apartment was an investment.

"There's no reason to start assuming everybody's bad," she said, "because it's the opposite."

With Tara Smith and Joe Werkmeister