S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4941
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 5, 2019
                                ___________
 
 Introduced by M. of A. THIELE -- read once and referred to the Committee
   on Local Governments
 
 AN ACT to amend the town law and the tax law, in relation to authorizing
   towns  in  the Peconic Bay region to establish community housing funds
   to be funded by a supplemental real estate transfer tax

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Legislative findings.   The legislature hereby finds that
 critical to the future of the Peconic Bay region  is  the  need  for  an
 adequate supply of housing opportunities for all segments of the Peconic
 Bay community.
   The adverse impact resulting from the lack of housing opportunities is
 severe.  Local  employers  are  having  difficulty  hiring and retaining
 employees because of housing costs  and  availability.  Local  volunteer
 emergency  services  agencies are experiencing difficulty in recruitment
 and retention.  Long-time residents are forced to leave the area.  Traf-
 fic  congestion  is  intensified  by the importation of labor from areas
 with lower housing costs.  Finally, the lack of housing opportunities is
 resulting in residents being forced  to  live  in  substandard,  illegal
 conditions.
   The  unique demographics and economics in the Peconic Bay region and a
 lack of affordable dwelling units are contributing to this housing shor-
 tage.  The combination of the Peconic Bay region's attractiveness, prox-
 imity to the dense population of the New York metropolitan region and to
 that region's extraordinary wealth, makes the Peconic Bay region a prime
 location for seasonal  and  luxury  homes.  While  this  combination  of
 extraordinary attractiveness, population density, and wealth has created
 a  strong local economy for the Peconic Bay region, it has resulted in a
 housing crisis for local families. In the Peconic Bay region, more  than
 40% of all housing units are seasonal.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD03159-02-9
              

 A. 4941                             2
 
   In  summary,  the  demand  of  land  for luxury and seasonal homes and
 seasonal rentals has left a short supply of  housing  opportunities  for
 moderate income and working class local residents. The implementation of
 the  new federal tax bill will only exacerbate this problem by making it
 more  difficult  for  first time homebuyers by imposing a $10,000 cap on
 the deductibility of state and local taxes and by reducing the  mortgage
 interest  deduction  on new mortgages. The Peconic Bay region requires a
 balanced housing policy where there exists a variety  of  housing  types
 and opportunities across the region's economic spectrum.
   It  is the public purpose of this legislation to give the towns of the
 Peconic Bay region the authority and resources  needed  to  establish  a
 dedicated  fund  to  provide needed housing opportunities. Specifically,
 this legislation would permit each town to establish a community housing
 fund to increase housing opportunities in the region.  Further,  a  town
 housing plan adhering to smart growth principles would be required to be
 approved  and implemented to insure that these new housing opportunities
 are enacted in the context of a comprehensive plan. The  fund  shall  be
 enacted by local law subject to a mandatory referendum.
   Said fund would be financed by a combination of state and local funds,
 including  a  0.5% supplemental real estate transfer tax, which would be
 in addition to the existing 2% real estate transfer tax for the  Peconic
 Bay region community preservation fund.
   §  2.  This  act  shall  be known and may be cited as the "Peconic Bay
 region community housing act".
   § 3. The town law is amended by adding a new section 64-k to  read  as
 follows:
   § 64-K. PECONIC BAY REGION COMMUNITY HOUSING FUND.  1. DEFINITIONS. AS
 USED  IN  THIS  SECTION,  THE  FOLLOWING  WORDS AND TERMS SHALL HAVE THE
 FOLLOWING MEANINGS:
   (A) "PECONIC BAY REGION" MEANS THE TOWNS OF EAST  HAMPTON,  RIVERHEAD,
 SHELTER ISLAND, SOUTHAMPTON, AND SOUTHOLD.
   (B)  "COMMUNITY  HOUSING"  MEANS  A PRIMARY RESIDENTIAL PROPERTY FOR A
 HOUSEHOLD WITH AN INCOME THAT DOES NOT EXCEED ONE HUNDRED PERCENT OF THE
 INCOME LIMITS AND ONE  HUNDRED  FIFTY  PERCENT  OF  THE  PURCHASE  PRICE
 LIMITS.  THE  INCOME LIMITS AND PURCHASE PRICE LIMITS SHALL BE AS ESTAB-
 LISHED BY THE STATE OF NEW YORK MORTGAGE AGENCY LOW INTEREST  RATE  LOAN
 PROGRAM  IN  NON-TARGET  CATEGORIES  FOR SUFFOLK COUNTY IN EFFECT ON THE
 CONTRACT DATE FOR THE SALE OF SUCH PROPERTY.
   (C) "BOARD" MEANS THE ADVISORY BOARD CREATED PURSUANT TO THIS SECTION.
   (D) "FUND" MEANS THE COMMUNITY HOUSING  FUND  AUTHORIZED  PURSUANT  TO
 THIS SECTION.
   (E)  "FIRST  HOME" MEANS A PERSON WHO HAS NOT OWNED A PRIMARY RESIDEN-
 TIAL PROPERTY AND IS NOT MARRIED TO A PERSON WHO HAS OWNED A RESIDENTIAL
 PROPERTY DURING THE THREE-YEAR PERIOD PRIOR TO HIS OR  HER  PURCHASE  OF
 THE  PRIMARY  RESIDENTIAL  PROPERTY,  AND WHO DOES NOT OWN A VACATION OR
 INVESTMENT HOME.
   (F) "PRIMARY RESIDENTIAL PROPERTY" MEANS ANY ONE OR TWO FAMILY  HOUSE,
 TOWNHOUSE, OR CONDOMINIUM.
   (G)  "EDUCATION  IMPACT PAYMENT" MEANS AN ANNUAL PAYMENT MADE FROM THE
 FUND TO SCHOOL DISTRICTS NOT TO EXCEED AN AMOUNT EQUAL TO THE ADDITIONAL
 ANNUAL REAL PROPERTY TAX IMPACT OF EDUCATING THE NUMBER OF STUDENTS THAT
 WILL BE ADDED TO A SCHOOL DISTRICT AS A  RESULT  OF  THE  PRODUCTION  OF
 COMMUNITY  HOUSING, PURSUANT TO THE FUND. SUCH ANNUAL PAYMENTS SHALL NOT
 EXCEED FIVE YEARS.
   2. FUND AUTHORIZED. THE TOWN BOARD OF ANY  TOWN  IN  THE  PECONIC  BAY
 REGION IS AUTHORIZED TO ESTABLISH BY LOCAL LAW A COMMUNITY HOUSING FUND,

 A. 4941                             3

 PURSUANT  TO  THE PROVISIONS OF THIS SECTION. DEPOSITS INTO THE FUND MAY
 INCLUDE REVENUES OF THE LOCAL GOVERNMENT FROM WHATEVER SOURCE, INCLUDING
 BUT NOT LIMITED TO: (A) ALL REVENUES FROM THE SUPPLEMENTAL  REAL  ESTATE
 TRANSFER  TAX  AUTHORIZED BY SUBDIVISION TWO OF SECTION FOURTEEN HUNDRED
 FORTY-NINE-BB OF THE TAX LAW; (B) ALL PROCEEDS FROM ANY INDEBTEDNESS  OR
 OBLIGATIONS ISSUED PURSUANT TO THE LOCAL FINANCE LAW FOR COMMUNITY HOUS-
 ING  OPPORTUNITY  PURPOSES  AS  AUTHORIZED  IN SUBDIVISION THREE OF THIS
 SECTION; (C) GENERAL  FUND  BALANCES  OR  SURPLUSES;  (D)  ANY  PROCEEDS
 RECEIVED  BY  THE LOCAL GOVERNMENT FROM THE SALE OR RENTAL OF AFFORDABLE
 HOUSING PRODUCED FROM REVENUES OF THE FUND; (E)  THE  REPAYMENT  OF  ANY
 LOANS  ISSUED  FROM  PROCEEDS OF THE FUND; (F) ANY GIFTS OF INTERESTS IN
 LAND OR FUNDS; (G) ANY STATE OR FEDERAL GRANTS RECEIVED BY THE TOWN  FOR
 PROVIDING AFFORDABLE HOMES.
   3. PURPOSES OF THE FUND. THE PROCEEDS OF THE FUND ESTABLISHED PURSUANT
 TO  SUBDIVISION  TWO OF THIS SECTION SHALL BE UTILIZED FOR THE FOLLOWING
 PURPOSES:
   (A) THE PROVISION OF NO-INTEREST LOANS TO ELIGIBLE  RESIDENTS  OF  THE
 TOWN FOR THE PURCHASE OF A FIRST HOME.
   (1)  A  TOWN  MAY  MAKE  A  LOAN TO A RESIDENT OF THE TOWN OR A PERSON
 EMPLOYED IN THE TOWN FOR THE PURCHASE OF A FIRST HOME. A RESIDENT OF THE
 TOWN SHALL INCLUDE A PERSON WHO IS CURRENTLY A PRIMARY RESIDENT  OF  THE
 TOWN  OR  A NON-RESIDENT WHO HAS BEEN A PRIMARY RESIDENT WITHIN THE PAST
 FIVE YEARS.
   (2) SAID LOAN SHALL NOT EXCEED FIFTY PERCENT OF THE PURCHASE PRICE  OF
 THE HOME.
   (3)  SAID  LOAN SHALL BE REPAYABLE TO THE TOWN UPON THE RE-SALE OF THE
 HOME.
   (4) THE REPAYMENT TO THE TOWN SHALL BE AN AMOUNT EQUAL TO THE  PROPOR-
 TION  OF  THE ORIGINAL LOAN FROM THE TOWN TO THE ORIGINAL PURCHASE PRICE
 TO THE RESALE PRICE MULTIPLIED BY THE RE-SALE PURCHASE PRICE.
   (5) FOR THE PURPOSES OF CALCULATING TOWN TAX LIABILITY FOR SUCH  PROP-
 ERTY,  ONLY,  THE  DOLLAR AMOUNT OF ANY LOAN FOR THE PURCHASE OF A FIRST
 HOME MADE BY THE TOWN PURSUANT TO THIS SECTION SHALL BE SUBTRACTED  FROM
 THE FULL EQUALIZED ASSESSED VALUE OF SUCH PROPERTY.
   (6)  ALL  REVENUES  RECEIVED  BY  THE TOWN FROM THE REPAYMENT OF LOANS
 SHALL BE DEPOSITED IN THE FUND.
   (B) THE ACTUAL PRODUCTION OF COMMUNITY HOUSING FOR  SALE  TO  ELIGIBLE
 INDIVIDUALS BY THE TOWN;
   (C)  THE  ACTUAL  PRODUCTION OF COMMUNITY HOUSING FOR SALE TO ELIGIBLE
 INDIVIDUALS IN CONJUNCTION WITH A PUBLIC/PRIVATE PARTNERSHIP, WHERE  THE
 PRIVATE  PARTNER  AGREES TO COMPLY WITH THE PROFIT GUIDELINES OF THE NEW
 YORK STATE AFFORDABLE HOUSING CORPORATION AND  THE  PROVISIONS  OF  THIS
 SECTION;
   (D)  THE  ACTUAL PRODUCTION AND MAINTENANCE OF RENTAL HOUSING FOR RENT
 TO ELIGIBLE INDIVIDUALS EITHER BY THE TOWN, THE TOWN HOUSING  AUTHORITY,
 OR  IN  CONJUNCTION WITH A PUBLIC/PRIVATE PARTNERSHIP, WHERE THE PRIVATE
 PARTNER AGREES TO COMPLY WITH THE PROFIT  GUIDELINES  OF  THE  NEW  YORK
 STATE AFFORDABLE HOUSING CORPORATION AND THE PROVISIONS OF THIS SECTION;
   (E)  THE  REHABILITATION  OF  EXISTING BUILDINGS AND STRUCTURES IN THE
 TOWN FOR THE PURPOSE OF CONVERSION TO  COMMUNITY  HOUSING  FOR  SALE  OR
 RENTAL TO ELIGIBLE INDIVIDUALS;
   (F)  THE  PROVISION  OF  HOUSING COUNSELING SERVICES BY NOT-FOR-PROFIT
 CORPORATIONS WHO ARE AUTHORIZED BY THE UNITED STATES DEPARTMENT OF HOUS-
 ING AND URBAN DEVELOPMENT TO PROVIDE SUCH SERVICES; AND
   (G) THE PROVISION OF EDUCATION IMPACT PAYMENTS TO SCHOOL DISTRICTS  AS
 DEFINED IN PARAGRAPH (G) OF SUBDIVISION ONE OF THIS SECTION.

 A. 4941                             4

   (H)  THE  TOWN SHALL HAVE THE AUTHORITY TO ENACT RULES AND REGULATIONS
 TO FACILITATE THE PROVISIONS AND PURPOSES OF THIS SECTION.
   4. FUND MANAGEMENT. INTEREST ACCRUED BY MONIES DEPOSITED INTO THE FUND
 SHALL  BE  CREDITED TO THE FUND. IN NO EVENT SHALL MONIES DEPOSITED INTO
 THE FUND BE TRANSFERRED TO ANY OTHER ACCOUNT. NOTHING CONTAINED IN  THIS
 SECTION SHALL BE CONSTRUED TO PREVENT THE FINANCING IN WHOLE OR IN PART,
 PURSUANT TO THE LOCAL FINANCE LAW, OF ANY PURPOSE AUTHORIZED PURSUANT TO
 THIS SECTION. MONIES FROM THE FUND MAY BE UTILIZED TO REPAY INDEBTEDNESS
 OR  OBLIGATIONS  INCURRED  PURSUANT  TO THE LOCAL FINANCE LAW CONSISTENT
 WITH EFFECTUATING THE PURPOSES OF THIS SECTION.
   5. ELIGIBLE EXPENSES. FOR  THE  PURPOSES  OF  THIS  SECTION,  ELIGIBLE
 EXPENSES  RELATING  TO THE PRODUCTION OF COMMUNITY HOUSING AND THE REHA-
 BILITATION OF EXISTING BUILDINGS AND STRUCTURES  UNDER  THE  FUND  SHALL
 INCLUDE  BUT  NOT BE LIMITED TO LAND ACQUISITION, PLANNING, ENGINEERING,
 CONSTRUCTION COSTS, AND OTHER HARD AND SOFT COSTS  DIRECTLY  RELATED  TO
 THE CONSTRUCTION, REHABILITATION, PURCHASE OR RENTAL OF HOUSING PURSUANT
 TO  THIS  SECTION.  ALL  REVENUES  RECEIVED BY THE TOWN FROM THE SALE OR
 RENTAL OF COMMUNITY HOMES, OR THE REPAYMENT OF LOANS SHALL BE  DEPOSITED
 IN THE FUND.
   6.  ADVISORY  BOARD  ESTABLISHED.  THE  TOWN  BOARD OF ANY TOWN IN THE
 PECONIC BAY REGION WHICH HAS ESTABLISHED A COMMUNITY HOUSING FUND PURSU-
 ANT TO THIS SECTION SHALL CREATE AN ADVISORY BOARD TO  REVIEW  AND  MAKE
 RECOMMENDATIONS  REGARDING THE TOWN'S COMMUNITY HOUSING PLAN REQUIRED BY
 SUBDIVISION SEVEN OF THIS SECTION. SUCH BOARD SHALL CONSIST OF NOT  LESS
 THAN SEVEN NOR MORE THAN FIFTEEN LEGAL RESIDENTS OF THE MUNICIPALITY WHO
 SHALL  SERVE  WITHOUT  COMPENSATION.  NO MEMBER OF THE LOCAL LEGISLATIVE
 BODY SHALL SERVE ON THE BOARD. THE BOARD SHALL INCLUDE A  REPRESENTATIVE
 OF: (A) THE CONSTRUCTION INDUSTRY; (B) THE REAL ESTATE INDUSTRY; (C) THE
 BANKING INDUSTRY; AND THREE REPRESENTATIVES OF LOCAL HOUSING ADVOCACY OR
 HUMAN SERVICES ORGANIZATIONS. WHERE A VILLAGE OR VILLAGES, LOCATED WITH-
 IN  THE  TOWN,  HAVE  ELECTED TO PARTICIPATE IN THE FUND, AS PROVIDED IN
 SUBDIVISION SEVEN OF THIS SECTION, THE BOARD SHALL INCLUDE AT LEAST  ONE
 RESIDENT  OF A PARTICIPATING VILLAGE OR VILLAGES. WHERE AN INDIAN NATION
 IS LOCATED WITHIN THE BOUNDARIES OF A TOWN, THE BOARD SHALL  INCLUDE  AT
 LEAST  ONE  MEMBER  FROM SUCH NATION. THE BOARD SHALL ACT IN AN ADVISORY
 CAPACITY TO THE TOWN BOARD.
   7. ADOPTION OF HOUSING PLAN.   (A) BEFORE A  TOWN  MAY  ESTABLISH  THE
 FUND,  THE TOWN BOARD SHALL FIRST ADOPT A TOWN HOUSING PLAN WHICH ESTAB-
 LISHES AN IMPLEMENTATION PLAN FOR THE  PROVISION  OF  COMMUNITY  HOUSING
 OPPORTUNITIES BY THE FUND. SAID PLAN SHALL BE ADOPTED BY LOCAL LAW. SUCH
 PLAN SHALL ADHERE TO THE FOLLOWING SMART GROWTH PRINCIPLES:
   (1)  PUBLIC  INVESTMENT. TO ACCOUNT FOR AND MINIMIZE SOCIAL, ECONOMIC,
 AND ENVIRONMENTAL COSTS OF  NEW  DEVELOPMENT,  INCLUDING  INFRASTRUCTURE
 COSTS  SUCH  AS TRANSPORTATION, SEWERS, AND WASTEWATER TREATMENT, WATER,
 SCHOOLS, RECREATION, AND LOSS OF OPEN SPACE AND AGRICULTURAL LAND;
   (2) DEVELOPMENT. TO ENCOURAGE DEVELOPMENT IN AREAS  WHERE  TRANSPORTA-
 TION, WATER, AND SEWAGE INFRASTRUCTURE ARE AVAILABLE OR PRACTICAL;
   (3)  CONSERVATION.  TO  PROTECT,  PRESERVE,  AND  ENHANCE  THE STATE'S
 RESOURCES, INCLUDING AGRICULTURAL LAND, FORESTS, SURFACE WATERS, GROUND-
 WATER, RECREATION AND OPEN SPACE, SCENIC AREAS, AND SIGNIFICANT HISTORIC
 AND ARCHEOLOGICAL SITES;
   (4) COORDINATION. TO PROMOTE COORDINATION OF STATE AND  LOCAL  GOVERN-
 MENT DECISIONS AND COOPERATION AMONG COMMUNITIES TO WORK TOWARD THE MOST
 EFFICIENT,  PLANNED  AND  COST-EFFECTIVE DELIVERY OF GOVERNMENT SERVICES
 BY, AMONG OTHER MEANS, FACILITATING COOPERATIVE AGREEMENTS  AMONG  ADJA-

 A. 4941                             5
 
 CENT  COMMUNITIES, AND TO COORDINATE PLANNING TO ENSURE COMPATIBILITY OF
 ONE'S COMMUNITY DEVELOPMENT WITH DEVELOPMENT OF NEIGHBORING COMMUNITIES;
   (5)  COMMUNITY  DESIGN.  TO STRENGTHEN COMMUNITIES THROUGH DEVELOPMENT
 AND REDEVELOPMENT STRATEGIES THAT INCLUDE INTEGRATION OF ALL INCOME  AND
 AGE GROUPS, MIXED LAND USES, AND COMPACT DEVELOPMENT, TRADITIONAL NEIGH-
 BORHOOD  DEVELOPMENT,  PLANNED  UNIT  DEVELOPMENT, OPEN SPACE DISTRICTS,
 DOWNTOWN REVITALIZATION, BROWNFIELD REDEVELOPMENT,  ENHANCED  BEAUTY  IN
 PUBLIC  SPACES,  AND DIVERSE AND COMMUNITY HOUSING IN CLOSE PROXIMITY TO
 PLACES OF EMPLOYMENT, RECREATION, AND COMMERCIAL DEVELOPMENT;
   (6)  TRANSPORTATION.  TO  PROVIDE  TRANSPORTATION  CHOICES,  INCLUDING
 INCREASING  PUBLIC  TRANSIT  AND ALTERNATIVE MODES OF TRANSPORTATION, IN
 ORDER TO REDUCE AUTOMOBILE DEPENDENCY, TRAFFIC CONGESTION,  AND  AUTOMO-
 BILE POLLUTION;
   (7)  CONSISTENCY.  TO  INSURE  PREDICTABILITY IN BUILDING AND LAND USE
 CODES; AND
   (8) COMMUNITY  COLLABORATION.  TO  PROVIDE  FOR  AND  ENCOURAGE  LOCAL
 GOVERNMENTS  TO DEVELOP, THROUGH A COLLABORATIVE COMMUNITY-BASED EFFORT,
 SMART GROWTH PLANS THAT INCLUDE LONG TERM LAND USE AND  PERMIT  PREDICT-
 ABILITY  AND COORDINATION, EFFICIENT DECISION MAKING AND PLANNING IMPLE-
 MENTATION.
   (B) SUCH PLAN MAY INCLUDE THE ESTABLISHMENT OF  A  MAP  OR  MAPS  THAT
 DELINEATE  THE  HOUSING  IMPLEMENTATION  RECOMMENDATIONS PROPOSED BY THE
 TOWN.
   (C) SUCH PLAN SHALL BE UPDATED AT LEAST ONCE EVERY  FIVE  YEARS.  SUCH
 PLAN  AND  LOCAL  LAW  SHALL  BE  ADOPTED AT LEAST SIXTY DAYS BEFORE THE
 MANDATORY REFERENDUM REQUIRED BY SUBDIVISION TEN OF THIS SECTION.
   (D) THE TOWN HOUSING PLAN SHALL BE AN ELEMENT OF THE TOWN'S COMPREHEN-
 SIVE PLAN.
   (E) SUCH PLAN SHALL PROVIDE FOR  THE  LEGAL  MECHANISM  THAT  WILL  BE
 EMPLOYED  TO MAINTAIN THE HOUSING STOCK CREATED PURSUANT TO THIS SECTION
 AT COMMUNITY HOUSING ELIGIBILITY LEVELS. THE RE-SALE OF COMMUNITY  HOUS-
 ING  CREATED  PURSUANT  TO  THIS  SECTION  TO OTHER THAN INCOME ELIGIBLE
 HOUSEHOLDS SHALL BE PROHIBITED.
   (F) SUCH HOUSING PLAN SHALL PROVIDE FOR THE EQUITABLE DISTRIBUTION  OF
 COMMUNITY HOUSING OPPORTUNITIES AMONG ALL THE HAMLETS AND COMMUNITIES OF
 THE TOWN. THE PLAN SHALL INSURE THAT NO HAMLET OR COMMUNITY IS SITED FOR
 AN  UNDUE  CONCENTRATION  OF  COMMUNITY HOUSING OPPORTUNITIES THAT WOULD
 SUBSTANTIALLY ALTER THE CHARACTER OF THE HAMLET OR COMMUNITY. IN  DETER-
 MINING EQUITABLE DISTRIBUTION OF COMMUNITY HOUSING OPPORTUNITIES, EXIST-
 ING  COMMUNITY  HOUSING  OPPORTUNITIES IN A HAMLET OR COMMUNITY SHALL BE
 CONSIDERED.
   (G) SUCH HOUSING PLAN SHALL INCLUDE A  REGIONAL  HOUSING  STRATEGY  IN
 CONJUNCTION  WITH ALL OTHER PECONIC BAY TOWNS FOR THE PURPOSE OF MEETING
 THE REGIONAL HOUSING NEEDS IN THE PECONIC BAY REGION.
   8. VILLAGE AND INDIAN NATION PARTICIPATION.  (A) THE PARTICIPATION  OF
 ANY VILLAGE OR INDIAN NATION IN THE COMMUNITY HOUSING PROGRAM AUTHORIZED
 BY  THIS SECTION SHALL BE AT THE OPTION OF THE VILLAGE OR INDIAN NATION.
 IN ORDER TO PARTICIPATE, A VILLAGE OR INDIAN NATION SHALL PASS A  RESOL-
 UTION  OPTING  INTO  THE PROGRAM AND SHALL SUBMIT SAID RESOLUTION TO THE
 TOWN BOARD.
   (B) WHERE A VILLAGE OR INDIAN NATION OPTS TO PARTICIPATE  PURSUANT  TO
 THIS  SUBDIVISION,  AN  INTERGOVERNMENTAL  AGREEMENT  SHALL  BE EXECUTED
 PURSUANT TO ARTICLE FIVE-G OF THE GENERAL MUNICIPAL LAW OR OTHER  APPLI-
 CABLE LEGAL AUTHORITY, IN ORDER TO ESTABLISH THE RIGHTS AND RESPONSIBIL-
 ITIES OF EACH GOVERNMENT REGARDING COMMUNITY HOUSING OPPORTUNITIES.

 A. 4941                             6
 
   9. REGIONAL HOUSING STRATEGY. WITHIN ONE YEAR OF THE EFFECTIVE DATE OF
 THIS  SECTION,  THE  TOWNS SHALL ENTER INTO AN INTER-MUNICIPAL AGREEMENT
 PURSUANT TO ARTICLE FIVE-G OF  THE  GENERAL  MUNICIPAL  LAW  TO  JOINTLY
 IMPLEMENT  A REGIONAL HOUSING STRATEGY, AS PROVIDED FOR BY PARAGRAPH (G)
 OF  SUBDIVISION  SEVEN  OF  THIS  SECTION,  CONSISTENT WITH THE PURPOSES
 ENUMERATED IN SUBDIVISION THREE OF THIS SECTION. AT  LEAST  20%  OF  THE
 ANNUAL REVENUES OF EACH TOWN FUND SHALL BE DEVOTED TO THE IMPLEMENTATION
 OF THIS REGIONAL HOUSING STRATEGY.
   10.  MANDATORY  REFERENDUM. THE LOCAL LAW OR LAWS ADOPTING THE HOUSING
 PLAN AND ESTABLISHING THE COMMUNITY HOUSING FUND SHALL BE SUBJECT  TO  A
 MANDATORY REFERENDUM. SUCH LOCAL LAW OR LAWS SHALL ONLY BECOME EFFECTIVE
 UPON THE ADOPTION OF SAID REFERENDUM BY THE ELECTORS OF THE TOWN.
   §  4.  Section  1449-bb of the tax law, as added by chapter 114 of the
 laws of 1998, is amended to read as follows:
   § 1449-bb. Imposition of tax. 1. Notwithstanding any other  provisions
 of  law  to  the  contrary,  any  town in the Peconic Bay region, acting
 through its town board, is hereby authorized and empowered  to  adopt  a
 local law imposing in such town a tax on each conveyance of real proper-
 ty  or  interest  therein  where  the consideration exceeds five hundred
 dollars, at the rate of  two  percent  of  the  consideration  for  such
 conveyance.    Provided, however, any such local law imposing, repealing
 or reimposing such tax shall be subject to a mandatory referendum pursu-
 ant to section twenty-three of the municipal  home  rule  law.  Notwith-
 standing  the  foregoing,  prior to adoption of such local law, the town
 must establish a community preservation fund pursuant to section  sixty-
 four-e  of  the  town  law. Revenues from such tax shall be deposited in
 such fund and may be used solely for the purposes  of  such  fund.  Such
 local  law shall apply to any conveyance occurring on or after the first
 day of a month to be designated by such town board, which  is  not  less
 than  sixty  days  after  the enactment of such local law, but shall not
 apply to conveyances made on or after  such  date  pursuant  to  binding
 written  contracts  entered  into  prior to such date, provided that the
 date of execution of such contract is confirmed by independent  evidence
 such  as  the  recording  of the contract, payment of a deposit or other
 facts and circumstances as determined by the treasurer.
   2. NOTWITHSTANDING ANY OTHER PROVISIONS OF LAW  TO  THE  CONTRARY,  IN
 ADDITION  TO  THE TAX AUTHORIZED BY SUBDIVISION ONE OF THIS SECTION, ANY
 TOWN IN THE PECONIC BAY REGION, ACTING THROUGH ITS TOWN BOARD, IS HEREBY
 AUTHORIZED AND EMPOWERED TO ADOPT A LOCAL LAW IMPOSING IN  SUCH  TOWN  A
 SUPPLEMENTAL TAX ON EACH CONVEYANCE OF REAL PROPERTY OR INTEREST THEREIN
 WHERE THE CONSIDERATION EXCEEDS FIVE HUNDRED DOLLARS, AT THE RATE OF ONE
 HALF  OF ONE PERCENT OF THE CONSIDERATION FOR SUCH CONVEYANCE. PROVIDED,
 HOWEVER, ANY SUCH LOCAL LAW  IMPOSING,  REPEALING  OR  RE-IMPOSING  SUCH
 SUPPLEMENTAL  TAX SHALL BE SUBJECT TO A MANDATORY REFERENDUM PURSUANT TO
 SECTION TWENTY-THREE OF THE MUNICIPAL HOME RULE LAW. NOTWITHSTANDING THE
 FOREGOING, PRIOR TO ADOPTION OF SUCH LOCAL LAW, THE TOWN MUST  ESTABLISH
 A  COMMUNITY  HOUSING  FUND PURSUANT TO SECTION SIXTY-FOUR-K OF THE TOWN
 LAW.  REVENUES FROM SUCH SUPPLEMENTAL TAX SHALL  BE  DEPOSITED  IN  SUCH
 FUND  AND  MAY  BE USED SOLELY FOR THE PURPOSES OF SUCH FUND. SUCH LOCAL
 LAW SHALL APPLY TO ANY CONVEYANCE OCCURRING ON OR AFTER THE FIRST DAY OF
 A MONTH TO BE DESIGNATED BY SUCH TOWN BOARD,  WHICH  IS  NOT  LESS  THAN
 SIXTY DAYS AFTER THE ENACTMENT OF SUCH LOCAL LAW, BUT SHALL NOT APPLY TO
 CONVEYANCES  MADE  ON  OR  AFTER  SUCH  DATE PURSUANT TO BINDING WRITTEN
 CONTRACTS ENTERED INTO PRIOR TO SUCH DATE, PROVIDED  THAT  THE  DATE  OF
 EXECUTION  OF SUCH CONTRACT IS CONFIRMED BY INDEPENDENT EVIDENCE SUCH AS

 A. 4941                             7
 
 THE RECORDING OF THE CONTRACT, PAYMENT OF A DEPOSIT OR OTHER  FACTS  AND
 CIRCUMSTANCES AS DETERMINED BY THE TREASURER.
   §  5.  Subdivision  3  of  section 1449-ee of the tax law, as added by
 chapter 114 of the laws of 1998, is amended to read as follows:
   3. (a) In the towns of East Hampton, Shelter Island  and  Southampton,
 an  exemption  of  [two]  THREE  hundred fifty thousand dollars shall be
 allowed on the consideration of the conveyance of improved real property
 or an interest therein and an exemption of one hundred thousand  dollars
 shall  be  allowed  on the consideration of the conveyance of unimproved
 real property. THIS EXEMPTION SHALL ALSO APPLY TO ANY  SUPPLEMENTAL  TAX
 IMPOSED  PURSUANT  TO SUBDIVISION TWO OF SECTION FOURTEEN HUNDRED FORTY-
 NINE-BB OF THIS ARTICLE.
   (b) In the towns of Riverhead and Southold, an exemption of [one]  TWO
 hundred  fifty thousand dollars shall be allowed on the consideration of
 the conveyance of improved real property or an interest therein  and  an
 exemption  of  seventy-five  thousand  dollars  shall  be allowed on the
 consideration of the conveyance  of  unimproved  real  property.    THIS
 EXEMPTION  SHALL  ALSO APPLY TO ANY SUPPLEMENTAL TAX IMPOSED PURSUANT TO
 SUBDIVISION TWO OF SECTION FOURTEEN HUNDRED FORTY-NINE-BB OF THIS  ARTI-
 CLE.
   (C) THE PROVISIONS OF THIS SUBDIVISION SHALL ONLY APPLY TO CONVEYANCES
 FOR  RESIDENTIAL PROPERTY WHERE THE CONSIDERATION IS TWO MILLION DOLLARS
 OR LESS.
   § 6. Severability clause. If any provision of this act or  application
 thereof  shall  for  any  reason  be  adjudged by any court of competent
 jurisdiction to be invalid, such judgment shall not affect,  impair,  or
 invalidate the remainder of the act, but shall be confined in its opera-
 tion  to  the  provision thereof directly involved in the controversy in
 which the judgment shall have been rendered.
   § 7. This act shall take effect immediately; provided,  however,  that
 the  amendments  to  section 1449-bb of the tax law and subdivision 3 of
 section 1449-ee of the tax law, made by sections four and five  of  this
 act,  respectively,  shall  not affect the repeal of article 31-D of the
 tax law and shall be deemed to be repealed therewith.

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4941--A
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 5, 2019
                                ___________
 
 Introduced by M. of A. THIELE -- read once and referred to the Committee
   on  Local  Governments  -- committee discharged, bill amended, ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend the town law and the tax law, in relation to authorizing
   towns in the Peconic Bay region to establish community  housing  funds
   to be funded by a supplemental real estate transfer tax
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Legislative findings.   The legislature hereby  finds  that
 critical  to  the  future  of  the Peconic Bay region is the need for an
 adequate supply of housing opportunities for all segments of the Peconic
 Bay community.
   The adverse impact resulting from the lack of housing opportunities is
 severe. Local employers  are  having  difficulty  hiring  and  retaining
 employees  because  of  housing  costs and availability. Local volunteer
 emergency services agencies are experiencing difficulty  in  recruitment
 and  retention.  Long-time residents are forced to leave the area. Traf-
 fic congestion is intensified by the importation  of  labor  from  areas
 with lower housing costs.  Finally, the lack of housing opportunities is
 resulting  in  residents  being  forced  to live in substandard, illegal
 conditions.
   The unique demographics and economics in the Peconic Bay region and  a
 lack of affordable dwelling units are contributing to this housing shor-
 tage.  The combination of the Peconic Bay region's attractiveness, prox-
 imity to the dense population of the New York metropolitan region and to
 that region's extraordinary wealth, makes the Peconic Bay region a prime
 location  for  seasonal  and  luxury  homes.  While  this combination of
 extraordinary attractiveness, population density, and wealth has created
 a strong local economy for the Peconic Bay region, it has resulted in  a
 housing  crisis for local families. In the Peconic Bay region, more than
 40% of all housing units are seasonal.

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD03159-03-9

 A. 4941--A                          2
 
   In summary, the demand of land  for  luxury  and  seasonal  homes  and
 seasonal  rentals  has  left a short supply of housing opportunities for
 moderate income and working class local residents. The implementation of
 the new federal tax bill will only exacerbate this problem by making  it
 more  difficult  for  first time homebuyers by imposing a $10,000 cap on
 the deductibility of state and local taxes and by reducing the  mortgage
 interest  deduction  on new mortgages. The Peconic Bay region requires a
 balanced housing policy where there exists a variety  of  housing  types
 and opportunities across the region's economic spectrum.
   It  is the public purpose of this legislation to give the towns of the
 Peconic Bay region the authority and resources  needed  to  establish  a
 dedicated  fund  to  provide needed housing opportunities. Specifically,
 this legislation would permit each town to establish a community housing
 fund to increase housing opportunities in the region.  Further,  a  town
 housing plan adhering to smart growth principles would be required to be
 approved  and implemented to insure that these new housing opportunities
 are enacted in the context of a comprehensive plan. The  fund  shall  be
 enacted by local law subject to a mandatory referendum.
   Said fund would be financed by a combination of state and local funds,
 including  a  0.5% supplemental real estate transfer tax, which would be
 in addition to the existing 2% real estate transfer tax for the  Peconic
 Bay region community preservation fund.
   §  2.  This  act  shall  be known and may be cited as the "Peconic Bay
 region community housing act".
   § 3. The town law is amended by adding a new section 64-k to  read  as
 follows:
   § 64-K. PECONIC BAY REGION COMMUNITY HOUSING FUND.  1. DEFINITIONS. AS
 USED  IN  THIS  SECTION,  THE  FOLLOWING  WORDS AND TERMS SHALL HAVE THE
 FOLLOWING MEANINGS:
   (A) "PECONIC BAY REGION" MEANS THE TOWNS OF EAST  HAMPTON,  RIVERHEAD,
 SHELTER ISLAND, SOUTHAMPTON, AND SOUTHOLD.
   (B)  "COMMUNITY  HOUSING"  MEANS  A PRIMARY RESIDENTIAL PROPERTY FOR A
 HOUSEHOLD WITH AN INCOME THAT DOES NOT EXCEED ONE HUNDRED PERCENT OF THE
 INCOME LIMITS AND ONE  HUNDRED  FIFTY  PERCENT  OF  THE  PURCHASE  PRICE
 LIMITS.  THE  INCOME LIMITS AND PURCHASE PRICE LIMITS SHALL BE AS ESTAB-
 LISHED BY THE STATE OF NEW YORK MORTGAGE AGENCY LOW INTEREST  RATE  LOAN
 PROGRAM  IN  NON-TARGET  CATEGORIES  FOR SUFFOLK COUNTY IN EFFECT ON THE
 CONTRACT DATE FOR THE SALE OF SUCH PROPERTY.
   (C) "BOARD" MEANS THE ADVISORY BOARD CREATED PURSUANT TO THIS SECTION.
   (D) "FUND" MEANS THE COMMUNITY HOUSING  FUND  AUTHORIZED  PURSUANT  TO
 THIS SECTION.
   (E)  "FIRST  HOME" MEANS A PERSON WHO HAS NOT OWNED A PRIMARY RESIDEN-
 TIAL PROPERTY AND IS NOT MARRIED TO A PERSON WHO HAS OWNED A RESIDENTIAL
 PROPERTY DURING THE THREE-YEAR PERIOD PRIOR TO HIS OR  HER  PURCHASE  OF
 THE  PRIMARY  RESIDENTIAL  PROPERTY,  AND WHO DOES NOT OWN A VACATION OR
 INVESTMENT HOME.
   (F) "PRIMARY RESIDENTIAL PROPERTY" MEANS ANY ONE OR TWO FAMILY  HOUSE,
 TOWNHOUSE, OR CONDOMINIUM.
   (G)  "EDUCATION  IMPACT PAYMENT" MEANS AN ANNUAL PAYMENT MADE FROM THE
 FUND TO SCHOOL DISTRICTS NOT TO EXCEED AN AMOUNT EQUAL TO THE ADDITIONAL
 ANNUAL REAL PROPERTY TAX IMPACT OF EDUCATING THE NUMBER OF STUDENTS THAT
 WILL BE ADDED TO A SCHOOL DISTRICT AS A  RESULT  OF  THE  PRODUCTION  OF
 COMMUNITY  HOUSING, PURSUANT TO THE FUND. SUCH ANNUAL PAYMENTS SHALL NOT
 EXCEED FIVE YEARS.
   2. FUND AUTHORIZED. THE TOWN BOARD OF ANY  TOWN  IN  THE  PECONIC  BAY
 REGION IS AUTHORIZED TO ESTABLISH BY LOCAL LAW A COMMUNITY HOUSING FUND,

 A. 4941--A                          3
 
 PURSUANT  TO  THE PROVISIONS OF THIS SECTION. DEPOSITS INTO THE FUND MAY
 INCLUDE REVENUES OF THE LOCAL GOVERNMENT FROM WHATEVER SOURCE, INCLUDING
 BUT NOT LIMITED TO: (A) ALL REVENUES FROM THE SUPPLEMENTAL  REAL  ESTATE
 TRANSFER  TAX  AUTHORIZED BY SUBDIVISION TWO OF SECTION FOURTEEN HUNDRED
 FORTY-NINE-BB OF THE TAX LAW; (B) ALL PROCEEDS FROM ANY INDEBTEDNESS  OR
 OBLIGATIONS ISSUED PURSUANT TO THE LOCAL FINANCE LAW FOR COMMUNITY HOUS-
 ING  OPPORTUNITY  PURPOSES  AS  AUTHORIZED  IN SUBDIVISION THREE OF THIS
 SECTION; (C) GENERAL  FUND  BALANCES  OR  SURPLUSES;  (D)  ANY  PROCEEDS
 RECEIVED  BY  THE LOCAL GOVERNMENT FROM THE SALE OR RENTAL OF AFFORDABLE
 HOUSING PRODUCED FROM REVENUES OF THE FUND; (E)  THE  REPAYMENT  OF  ANY
 LOANS  ISSUED  FROM  PROCEEDS OF THE FUND; (F) ANY GIFTS OF INTERESTS IN
 LAND OR FUNDS; (G) ANY STATE OR FEDERAL GRANTS RECEIVED BY THE TOWN  FOR
 PROVIDING AFFORDABLE HOMES.
   3. PURPOSES OF THE FUND. THE PROCEEDS OF THE FUND ESTABLISHED PURSUANT
 TO  SUBDIVISION  TWO OF THIS SECTION SHALL BE UTILIZED FOR THE FOLLOWING
 PURPOSES:
   (A) THE PROVISION OF NO-INTEREST LOANS TO ELIGIBLE  RESIDENTS  OF  THE
 TOWN FOR THE PURCHASE OF A FIRST HOME.
   (1)  A  TOWN  MAY  MAKE  A  LOAN TO A RESIDENT OF THE TOWN OR A PERSON
 EMPLOYED IN THE TOWN FOR THE PURCHASE OF A FIRST HOME. A RESIDENT OF THE
 TOWN SHALL INCLUDE A PERSON WHO IS CURRENTLY A PRIMARY RESIDENT  OF  THE
 TOWN  OR  A NON-RESIDENT WHO HAS BEEN A PRIMARY RESIDENT WITHIN THE PAST
 FIVE YEARS.
   (2) SAID LOAN SHALL NOT EXCEED FIFTY PERCENT OF THE PURCHASE PRICE  OF
 THE HOME.
   (3)  SAID  LOAN SHALL BE REPAYABLE TO THE TOWN UPON THE RE-SALE OF THE
 HOME.
   (4) THE REPAYMENT TO THE TOWN SHALL BE AN AMOUNT EQUAL TO THE  PROPOR-
 TION  OF  THE ORIGINAL LOAN FROM THE TOWN TO THE ORIGINAL PURCHASE PRICE
 TO THE RESALE PRICE MULTIPLIED BY THE RE-SALE PURCHASE PRICE.
   (5) FOR THE PURPOSES OF CALCULATING TOWN TAX LIABILITY FOR SUCH  PROP-
 ERTY,  ONLY,  THE  DOLLAR AMOUNT OF ANY LOAN FOR THE PURCHASE OF A FIRST
 HOME MADE BY THE TOWN PURSUANT TO THIS SECTION SHALL BE SUBTRACTED  FROM
 THE FULL EQUALIZED ASSESSED VALUE OF SUCH PROPERTY.
   (6)  ALL  REVENUES  RECEIVED  BY  THE TOWN FROM THE REPAYMENT OF LOANS
 SHALL BE DEPOSITED IN THE FUND.
   (B) THE ACTUAL PRODUCTION OF COMMUNITY HOUSING FOR  SALE  TO  ELIGIBLE
 INDIVIDUALS BY THE TOWN;
   (C)  THE  ACTUAL  PRODUCTION OF COMMUNITY HOUSING FOR SALE TO ELIGIBLE
 INDIVIDUALS IN CONJUNCTION WITH A PUBLIC/PRIVATE PARTNERSHIP, WHERE  THE
 PRIVATE  PARTNER  AGREES TO COMPLY WITH THE PROFIT GUIDELINES OF THE NEW
 YORK STATE AFFORDABLE HOUSING CORPORATION AND  THE  PROVISIONS  OF  THIS
 SECTION;
   (D)  THE  ACTUAL PRODUCTION AND MAINTENANCE OF RENTAL HOUSING FOR RENT
 TO ELIGIBLE INDIVIDUALS EITHER BY THE TOWN, THE TOWN HOUSING  AUTHORITY,
 OR  IN  CONJUNCTION WITH A PUBLIC/PRIVATE PARTNERSHIP, WHERE THE PRIVATE
 PARTNER AGREES TO COMPLY WITH THE PROFIT  GUIDELINES  OF  THE  NEW  YORK
 STATE AFFORDABLE HOUSING CORPORATION AND THE PROVISIONS OF THIS SECTION;
   (E)  THE  REHABILITATION  OF  EXISTING BUILDINGS AND STRUCTURES IN THE
 TOWN FOR THE PURPOSE OF CONVERSION TO  COMMUNITY  HOUSING  FOR  SALE  OR
 RENTAL TO ELIGIBLE INDIVIDUALS;
   (F)  THE  PROVISION  OF  HOUSING COUNSELING SERVICES BY NOT-FOR-PROFIT
 CORPORATIONS WHO ARE AUTHORIZED BY THE UNITED STATES DEPARTMENT OF HOUS-
 ING AND URBAN DEVELOPMENT TO PROVIDE SUCH SERVICES; AND
   (G) THE PROVISION OF EDUCATION IMPACT PAYMENTS TO SCHOOL DISTRICTS  AS
 DEFINED IN PARAGRAPH (G) OF SUBDIVISION ONE OF THIS SECTION.

 A. 4941--A                          4
 
   (H)  THE  TOWN SHALL HAVE THE AUTHORITY TO ENACT RULES AND REGULATIONS
 TO FACILITATE THE PROVISIONS AND PURPOSES OF THIS SECTION.
   4. FUND MANAGEMENT. INTEREST ACCRUED BY MONIES DEPOSITED INTO THE FUND
 SHALL  BE  CREDITED TO THE FUND. IN NO EVENT SHALL MONIES DEPOSITED INTO
 THE FUND BE TRANSFERRED TO ANY OTHER ACCOUNT. NOTHING CONTAINED IN  THIS
 SECTION SHALL BE CONSTRUED TO PREVENT THE FINANCING IN WHOLE OR IN PART,
 PURSUANT TO THE LOCAL FINANCE LAW, OF ANY PURPOSE AUTHORIZED PURSUANT TO
 THIS SECTION. MONIES FROM THE FUND MAY BE UTILIZED TO REPAY INDEBTEDNESS
 OR  OBLIGATIONS  INCURRED  PURSUANT  TO THE LOCAL FINANCE LAW CONSISTENT
 WITH EFFECTUATING THE PURPOSES OF THIS SECTION.
   5. ELIGIBLE EXPENSES. FOR  THE  PURPOSES  OF  THIS  SECTION,  ELIGIBLE
 EXPENSES  RELATING  TO THE PRODUCTION OF COMMUNITY HOUSING AND THE REHA-
 BILITATION OF EXISTING BUILDINGS AND STRUCTURES  UNDER  THE  FUND  SHALL
 INCLUDE  BUT  NOT BE LIMITED TO LAND ACQUISITION, PLANNING, ENGINEERING,
 CONSTRUCTION COSTS, AND OTHER HARD AND SOFT COSTS  DIRECTLY  RELATED  TO
 THE CONSTRUCTION, REHABILITATION, PURCHASE OR RENTAL OF HOUSING PURSUANT
 TO  THIS  SECTION.  ALL  REVENUES  RECEIVED BY THE TOWN FROM THE SALE OR
 RENTAL OF COMMUNITY HOMES, OR THE REPAYMENT OF LOANS SHALL BE  DEPOSITED
 IN THE FUND.
   6.  ADVISORY  BOARD  ESTABLISHED.  THE  TOWN  BOARD OF ANY TOWN IN THE
 PECONIC BAY REGION WHICH HAS ESTABLISHED A COMMUNITY HOUSING FUND PURSU-
 ANT TO THIS SECTION SHALL CREATE AN ADVISORY BOARD TO  REVIEW  AND  MAKE
 RECOMMENDATIONS  REGARDING THE TOWN'S COMMUNITY HOUSING PLAN REQUIRED BY
 SUBDIVISION SEVEN OF THIS SECTION. SUCH BOARD SHALL CONSIST OF NOT  LESS
 THAN SEVEN NOR MORE THAN FIFTEEN LEGAL RESIDENTS OF THE MUNICIPALITY WHO
 SHALL  SERVE  WITHOUT  COMPENSATION.  NO MEMBER OF THE LOCAL LEGISLATIVE
 BODY SHALL SERVE ON THE BOARD. THE BOARD SHALL INCLUDE A  REPRESENTATIVE
 OF: (A) THE CONSTRUCTION INDUSTRY; (B) THE REAL ESTATE INDUSTRY; (C) THE
 BANKING INDUSTRY; AND THREE REPRESENTATIVES OF LOCAL HOUSING ADVOCACY OR
 HUMAN SERVICES ORGANIZATIONS. WHERE A VILLAGE OR VILLAGES, LOCATED WITH-
 IN  THE  TOWN,  HAVE  ELECTED TO PARTICIPATE IN THE FUND, AS PROVIDED IN
 SUBDIVISION SEVEN OF THIS SECTION, THE BOARD SHALL INCLUDE AT LEAST  ONE
 RESIDENT  OF A PARTICIPATING VILLAGE OR VILLAGES. WHERE AN INDIAN NATION
 IS LOCATED WITHIN THE BOUNDARIES OF A TOWN, THE BOARD SHALL  INCLUDE  AT
 LEAST  ONE  MEMBER  FROM SUCH NATION. THE BOARD SHALL ACT IN AN ADVISORY
 CAPACITY TO THE TOWN BOARD.
   7. ADOPTION OF HOUSING PLAN.   (A) BEFORE A  TOWN  MAY  ESTABLISH  THE
 FUND,  THE TOWN BOARD SHALL FIRST ADOPT A TOWN HOUSING PLAN WHICH ESTAB-
 LISHES AN IMPLEMENTATION PLAN FOR THE  PROVISION  OF  COMMUNITY  HOUSING
 OPPORTUNITIES BY THE FUND. SAID PLAN SHALL BE ADOPTED BY LOCAL LAW. SUCH
 PLAN SHALL ADHERE TO THE FOLLOWING SMART GROWTH PRINCIPLES:
   (1)  PUBLIC  INVESTMENT. TO ACCOUNT FOR AND MINIMIZE SOCIAL, ECONOMIC,
 AND ENVIRONMENTAL COSTS OF  NEW  DEVELOPMENT,  INCLUDING  INFRASTRUCTURE
 COSTS  SUCH  AS TRANSPORTATION, SEWERS, AND WASTEWATER TREATMENT, WATER,
 SCHOOLS, RECREATION, AND LOSS OF OPEN SPACE AND AGRICULTURAL LAND;
   (2) DEVELOPMENT. TO ENCOURAGE DEVELOPMENT IN AREAS  WHERE  TRANSPORTA-
 TION, WATER, AND SEWAGE INFRASTRUCTURE ARE AVAILABLE OR PRACTICAL;
   (3)  CONSERVATION.  TO  PROTECT,  PRESERVE,  AND  ENHANCE  THE STATE'S
 RESOURCES, INCLUDING AGRICULTURAL LAND, FORESTS, SURFACE WATERS, GROUND-
 WATER, RECREATION AND OPEN SPACE, SCENIC AREAS, AND SIGNIFICANT HISTORIC
 AND ARCHEOLOGICAL SITES;
   (4) COORDINATION. TO PROMOTE COORDINATION OF STATE AND  LOCAL  GOVERN-
 MENT DECISIONS AND COOPERATION AMONG COMMUNITIES TO WORK TOWARD THE MOST
 EFFICIENT,  PLANNED  AND  COST-EFFECTIVE DELIVERY OF GOVERNMENT SERVICES
 BY, AMONG OTHER MEANS, FACILITATING COOPERATIVE AGREEMENTS  AMONG  ADJA-

 A. 4941--A                          5
 
 CENT  COMMUNITIES, AND TO COORDINATE PLANNING TO ENSURE COMPATIBILITY OF
 ONE'S COMMUNITY DEVELOPMENT WITH DEVELOPMENT OF NEIGHBORING COMMUNITIES;
   (5)  COMMUNITY  DESIGN.  TO STRENGTHEN COMMUNITIES THROUGH DEVELOPMENT
 AND REDEVELOPMENT STRATEGIES THAT INCLUDE INTEGRATION OF ALL INCOME  AND
 AGE GROUPS, MIXED LAND USES, AND COMPACT DEVELOPMENT, TRADITIONAL NEIGH-
 BORHOOD  DEVELOPMENT,  PLANNED  UNIT  DEVELOPMENT, OPEN SPACE DISTRICTS,
 DOWNTOWN REVITALIZATION, BROWNFIELD REDEVELOPMENT,  ENHANCED  BEAUTY  IN
 PUBLIC  SPACES,  AND DIVERSE AND COMMUNITY HOUSING IN CLOSE PROXIMITY TO
 PLACES OF EMPLOYMENT, RECREATION, AND COMMERCIAL DEVELOPMENT;
   (6)  TRANSPORTATION.  TO  PROVIDE  TRANSPORTATION  CHOICES,  INCLUDING
 INCREASING  PUBLIC  TRANSIT  AND ALTERNATIVE MODES OF TRANSPORTATION, IN
 ORDER TO REDUCE AUTOMOBILE DEPENDENCY, TRAFFIC CONGESTION,  AND  AUTOMO-
 BILE POLLUTION;
   (7)  CONSISTENCY.  TO  INSURE  PREDICTABILITY IN BUILDING AND LAND USE
 CODES; AND
   (8) COMMUNITY  COLLABORATION.  TO  PROVIDE  FOR  AND  ENCOURAGE  LOCAL
 GOVERNMENTS  TO DEVELOP, THROUGH A COLLABORATIVE COMMUNITY-BASED EFFORT,
 SMART GROWTH PLANS THAT INCLUDE LONG TERM LAND USE AND  PERMIT  PREDICT-
 ABILITY  AND COORDINATION, EFFICIENT DECISION MAKING AND PLANNING IMPLE-
 MENTATION.
   (B) SUCH PLAN MAY INCLUDE THE ESTABLISHMENT OF  A  MAP  OR  MAPS  THAT
 DELINEATE  THE  HOUSING  IMPLEMENTATION  RECOMMENDATIONS PROPOSED BY THE
 TOWN.
   (C) SUCH PLAN SHALL BE UPDATED AT LEAST ONCE EVERY  FIVE  YEARS.  SUCH
 PLAN  AND  LOCAL  LAW  SHALL  BE  ADOPTED AT LEAST SIXTY DAYS BEFORE THE
 MANDATORY REFERENDUM REQUIRED BY SUBDIVISION TEN OF THIS SECTION.
   (D) THE TOWN HOUSING PLAN SHALL BE AN ELEMENT OF THE TOWN'S COMPREHEN-
 SIVE PLAN.
   (E) SUCH PLAN SHALL PROVIDE FOR  THE  LEGAL  MECHANISM  THAT  WILL  BE
 EMPLOYED  TO MAINTAIN THE HOUSING STOCK CREATED PURSUANT TO THIS SECTION
 AT COMMUNITY HOUSING ELIGIBILITY LEVELS. THE RE-SALE OF COMMUNITY  HOUS-
 ING  CREATED  PURSUANT  TO  THIS  SECTION  TO OTHER THAN INCOME ELIGIBLE
 HOUSEHOLDS SHALL BE PROHIBITED.
   (F) SUCH HOUSING PLAN SHALL PROVIDE FOR THE EQUITABLE DISTRIBUTION  OF
 COMMUNITY HOUSING OPPORTUNITIES AMONG ALL THE HAMLETS AND COMMUNITIES OF
 THE TOWN. THE PLAN SHALL INSURE THAT NO HAMLET OR COMMUNITY IS SITED FOR
 AN  UNDUE  CONCENTRATION  OF  COMMUNITY HOUSING OPPORTUNITIES THAT WOULD
 SUBSTANTIALLY ALTER THE CHARACTER OF THE HAMLET OR COMMUNITY. IN  DETER-
 MINING EQUITABLE DISTRIBUTION OF COMMUNITY HOUSING OPPORTUNITIES, EXIST-
 ING  COMMUNITY  HOUSING  OPPORTUNITIES IN A HAMLET OR COMMUNITY SHALL BE
 CONSIDERED.
   (G) SUCH HOUSING PLAN SHALL INCLUDE A  REGIONAL  HOUSING  STRATEGY  IN
 CONJUNCTION  WITH ALL OTHER PECONIC BAY TOWNS FOR THE PURPOSE OF MEETING
 THE REGIONAL HOUSING NEEDS IN THE PECONIC BAY REGION.
   8. VILLAGE AND INDIAN NATION PARTICIPATION.  (A) THE PARTICIPATION  OF
 ANY VILLAGE OR INDIAN NATION IN THE COMMUNITY HOUSING PROGRAM AUTHORIZED
 BY  THIS SECTION SHALL BE AT THE OPTION OF THE VILLAGE OR INDIAN NATION.
 IN ORDER TO PARTICIPATE, A VILLAGE OR INDIAN NATION SHALL PASS A  RESOL-
 UTION  OPTING  INTO  THE PROGRAM AND SHALL SUBMIT SAID RESOLUTION TO THE
 TOWN BOARD.
   (B) WHERE A VILLAGE OR INDIAN NATION OPTS TO PARTICIPATE  PURSUANT  TO
 THIS  SUBDIVISION,  AN  INTERGOVERNMENTAL  AGREEMENT  SHALL  BE EXECUTED
 PURSUANT TO ARTICLE FIVE-G OF THE GENERAL MUNICIPAL LAW OR OTHER  APPLI-
 CABLE LEGAL AUTHORITY, IN ORDER TO ESTABLISH THE RIGHTS AND RESPONSIBIL-
 ITIES OF EACH GOVERNMENT REGARDING COMMUNITY HOUSING OPPORTUNITIES.

 A. 4941--A                          6
 
   9. REGIONAL HOUSING STRATEGY. WITHIN ONE YEAR OF THE EFFECTIVE DATE OF
 THIS  SECTION,  THE  TOWNS SHALL ENTER INTO AN INTER-MUNICIPAL AGREEMENT
 PURSUANT TO ARTICLE FIVE-G OF  THE  GENERAL  MUNICIPAL  LAW  TO  JOINTLY
 IMPLEMENT  A REGIONAL HOUSING STRATEGY, AS PROVIDED FOR BY PARAGRAPH (G)
 OF  SUBDIVISION  SEVEN  OF  THIS  SECTION,  CONSISTENT WITH THE PURPOSES
 ENUMERATED IN SUBDIVISION THREE OF THIS SECTION. AT LEAST TWENTY PERCENT
 OF THE ANNUAL REVENUES OF EACH TOWN FUND SHALL BE DEVOTED TO THE  IMPLE-
 MENTATION OF THIS REGIONAL HOUSING STRATEGY.
   10.  MANDATORY  REFERENDUM. THE LOCAL LAW OR LAWS ADOPTING THE HOUSING
 PLAN AND ESTABLISHING THE COMMUNITY HOUSING FUND SHALL BE SUBJECT  TO  A
 MANDATORY REFERENDUM. SUCH LOCAL LAW OR LAWS SHALL ONLY BECOME EFFECTIVE
 UPON THE ADOPTION OF SAID REFERENDUM BY THE ELECTORS OF THE TOWN.
   §  4.  Section  1449-bb of the tax law, as added by chapter 114 of the
 laws of 1998, is amended to read as follows:
   § 1449-bb. Imposition of tax. 1. Notwithstanding any other  provisions
 of  law  to  the  contrary,  any  town in the Peconic Bay region, acting
 through its town board, is hereby authorized and empowered  to  adopt  a
 local law imposing in such town a tax on each conveyance of real proper-
 ty  or  interest  therein  where  the consideration exceeds five hundred
 dollars, at the rate of  two  percent  of  the  consideration  for  such
 conveyance.    Provided, however, any such local law imposing, repealing
 or reimposing such tax shall be subject to a mandatory referendum pursu-
 ant to section twenty-three of the municipal  home  rule  law.  Notwith-
 standing  the  foregoing,  prior to adoption of such local law, the town
 must establish a community preservation fund pursuant to section  sixty-
 four-e  of  the  town  law. Revenues from such tax shall be deposited in
 such fund and may be used solely for the purposes  of  such  fund.  Such
 local  law shall apply to any conveyance occurring on or after the first
 day of a month to be designated by such town board, which  is  not  less
 than  sixty  days  after  the enactment of such local law, but shall not
 apply to conveyances made on or after  such  date  pursuant  to  binding
 written  contracts  entered  into  prior to such date, provided that the
 date of execution of such contract is confirmed by independent  evidence
 such  as  the  recording  of the contract, payment of a deposit or other
 facts and circumstances as determined by the treasurer.
   2. NOTWITHSTANDING ANY OTHER PROVISIONS OF LAW  TO  THE  CONTRARY,  IN
 ADDITION  TO  THE TAX AUTHORIZED BY SUBDIVISION ONE OF THIS SECTION, ANY
 TOWN IN THE PECONIC BAY REGION, ACTING THROUGH ITS TOWN BOARD, IS HEREBY
 AUTHORIZED AND EMPOWERED TO ADOPT A LOCAL LAW IMPOSING IN  SUCH  TOWN  A
 SUPPLEMENTAL TAX ON EACH CONVEYANCE OF REAL PROPERTY OR INTEREST THEREIN
 WHERE THE CONSIDERATION EXCEEDS FIVE HUNDRED DOLLARS, AT THE RATE OF ONE
 HALF  OF ONE PERCENT OF THE CONSIDERATION FOR SUCH CONVEYANCE. PROVIDED,
 HOWEVER, ANY SUCH LOCAL LAW  IMPOSING,  REPEALING  OR  RE-IMPOSING  SUCH
 SUPPLEMENTAL  TAX SHALL BE SUBJECT TO A MANDATORY REFERENDUM PURSUANT TO
 SECTION TWENTY-THREE OF THE MUNICIPAL HOME RULE LAW. NOTWITHSTANDING THE
 FOREGOING, PRIOR TO ADOPTION OF SUCH LOCAL LAW, THE TOWN MUST  ESTABLISH
 A  COMMUNITY  HOUSING  FUND PURSUANT TO SECTION SIXTY-FOUR-K OF THE TOWN
 LAW.  REVENUES FROM SUCH SUPPLEMENTAL TAX SHALL  BE  DEPOSITED  IN  SUCH
 FUND  AND  MAY  BE USED SOLELY FOR THE PURPOSES OF SUCH FUND. SUCH LOCAL
 LAW SHALL APPLY TO ANY CONVEYANCE OCCURRING ON OR AFTER THE FIRST DAY OF
 A MONTH TO BE DESIGNATED BY SUCH TOWN BOARD,  WHICH  IS  NOT  LESS  THAN
 SIXTY DAYS AFTER THE ENACTMENT OF SUCH LOCAL LAW, BUT SHALL NOT APPLY TO
 CONVEYANCES  MADE  ON  OR  AFTER  SUCH  DATE PURSUANT TO BINDING WRITTEN
 CONTRACTS ENTERED INTO PRIOR TO SUCH DATE, PROVIDED  THAT  THE  DATE  OF
 EXECUTION  OF SUCH CONTRACT IS CONFIRMED BY INDEPENDENT EVIDENCE SUCH AS

 A. 4941--A                          7
 
 THE RECORDING OF THE CONTRACT, PAYMENT OF A DEPOSIT OR OTHER  FACTS  AND
 CIRCUMSTANCES AS DETERMINED BY THE TREASURER.
   §  5.  Subdivision  3  of  section 1449-ee of the tax law, as added by
 chapter 114 of the laws of 1998, is amended to read as follows:
   3. (a) In the towns of East Hampton, Shelter Island  and  Southampton,
 an  exemption  of  [two]  FOUR hundred [fifty] thousand dollars shall be
 allowed on the consideration of the conveyance of improved real property
 or an interest therein and an exemption of one hundred thousand  dollars
 shall  be  allowed  on the consideration of the conveyance of unimproved
 real property. THIS EXEMPTION SHALL ALSO APPLY TO ANY  SUPPLEMENTAL  TAX
 IMPOSED  PURSUANT  TO SUBDIVISION TWO OF SECTION FOURTEEN HUNDRED FORTY-
 NINE-BB OF THIS ARTICLE.
   (b) In the towns of Riverhead and Southold, an exemption of [one]  TWO
 hundred  [fifty] EIGHTY thousand dollars shall be allowed on the consid-
 eration of the conveyance of improved real property or an interest ther-
 ein and an exemption of seventy-five thousand dollars shall  be  allowed
 on  the  consideration  of  the  conveyance of unimproved real property.
 THIS EXEMPTION SHALL ALSO APPLY TO ANY SUPPLEMENTAL TAX IMPOSED PURSUANT
 TO SUBDIVISION TWO OF SECTION FOURTEEN  HUNDRED  FORTY-NINE-BB  OF  THIS
 ARTICLE.
   (C) THE PROVISIONS OF THIS SUBDIVISION SHALL ONLY APPLY TO CONVEYANCES
 FOR  RESIDENTIAL PROPERTY WHERE THE CONSIDERATION IS TWO MILLION DOLLARS
 OR LESS.
   § 6. Severability clause. If any provision of this act or  application
 thereof  shall  for  any  reason  be  adjudged by any court of competent
 jurisdiction to be invalid, such judgment shall not affect,  impair,  or
 invalidate the remainder of the act, but shall be confined in its opera-
 tion  to  the  provision thereof directly involved in the controversy in
 which the judgment shall have been rendered.
   § 7. This act shall take effect immediately; provided,  however,  that
 the  amendments  to  section 1449-bb of the tax law and subdivision 3 of
 section 1449-ee of the tax law, made by sections four and five  of  this
 act,  respectively,  shall  not affect the repeal of article 31-D of the
 tax law and shall be deemed to be repealed therewith.