Southampton pitches programs to tackle town's affordable housing problem 

Officials at Southampton Town’s Housing and Community Development office field calls from people “desperate for housing” nearly every day, said Kara Bak, the department’s director. 

They are working-class people who grew up locally, have jobs in the community and are struggling to keep their roots planted in an area with exorbitant real estate prices, she added in an interview.

To help boost affordable housing options, Southampton Town is working to adopt a community housing fund plan that outlines how officials will spend money generated through a new 0.5% tax on most real estate transactions.

In 2022, Southampton voters approved a referendum to create the fund. Earlier this month, Bak detailed a proposal for the housing fund plan at a town meeting. 

Supervisor Jay Schneiderman said it's important to not only create homeownership opportunities, but also rental opportunities.

"Not everyone is ready to buy a house," he added.

On Tuesday, the town board scheduled a Dec. 21 public hearing on the proposed housing fund plan, which could take effect early next year if legislators approve it.

Money in the fund, which has already generated more than $1.7 million, would be distributed through multiple programs under five banners if the proposal is adopted. Those are:

First-time homebuyer assistance programs, such as down payment assistance or a remodel program providing financing options for a "fixer-upper" purchase;, A program for developers who can use the funds to either buy land, or build and agree to restrict the sales price and sell to buyers of a certain income;, Rental programs, such as an accessory dwelling unit program and a motel conversion program;, A mortgage assistance program for volunteers such as firefighters and EMS workers; and, A program for workforce, senior and disabled residents,.

Bak said she researched similar communities to develop the proposed plan and found "a lot of resort communities around the country are facing the same kind of problems."

Southampton Town's population expanded from 56,790 in 2010 to 69,036 in 2020, according to the 2020 Census. But town officials have said those figures likely undercount the area's population surge amid the pandemic.

More than 45% of Southampton Town homes are valued at $1 million or more, according to the census. Just 9.2% of homes are valued between $300,000 and $499,999.

Bak said the town will set up an online application for people to apply for programs, and an advisory board will review applications and make funding recommendations to the town board.

Similar processes are underway in Southold, East Hampton and Shelter Island, where voters also approved the creation of such funds last year. Riverhead opted out of the referendum.

The Southold Town Board approved a community housing fund plan last month and Shelter Island approved a plan within a month of the referendum.

Officials estimated last month that the housing fund could yield $1.5 million annually in Southold, Newsday previously reported.

Shelter Island's fund generated $137,000 through the end of October, according to Elizabeth Hanley, who chairs the town's Community Housing Board. 

East Hampton Town has generated about $1.2 million in its fund, according to Eric Schantz, the director of housing and community development. He said the town adopted a community housing fund plan at the beginning of the year. 

Southampton Town's fund income has climbed steadily since the legislation took effect April 1. Homes that were under sales contracts before April 1 were exempt from the new tax.

Officials estimate the fund will draw an average of $1 million per month for Southampton.

“My hope is that we make an impact where our young people will be able to move back here,” Bak said. “I think we’re losing a lot of our younger generation.”