S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4040--A
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                             February 26, 2019
                                ___________
 
 Introduced  by  Sen. LAVALLE -- read twice and ordered printed, and when
   printed to be committed  to  the  Committee  on  Local  Government  --
   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

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD03159-14-9
              

 S. 4040--A                          2
 
 housing  crisis for local families. In the Peconic Bay region, more than
 40% of all housing units are seasonal.
   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.
   In addition, the exemption amounts from the total real estate transfer
 tax would be increased to $400,000 in the  towns  of  Southampton,  East
 Hampton and Shelter Island and to $280,000 in the towns of Riverhead and
 Southold.  This will insure that in the towns of East Hampton, Southamp-
 ton, and Shelter Island, the real estate transfer tax  will  be  reduced
 from  current  law  for  property  transfers  with a consideration under
 $1,000,000.  The real estate transfer tax would be reduced from  current
 law in the towns of Southold and Riverhead for property transfers with a
 consideration  under $800,000. Finally, the purchase price limit for the
 exemption for first time homebuyers in the towns of East Hampton, South-
 ampton and Shelter Island would be increased from 120% to  150%  of  the
 purchase  price  limit defined by the state of New York mortgage agency.
 These amendments to the exemptions will reduce any adverse  impact  from
 the transfer tax on the provision of community housing.
   §  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 AN
 ELIGIBLE INDIVIDUAL THAT DOES NOT EXCEED ONE HUNDRED  FIFTY  PERCENT  OF
 THE  PURCHASE PRICE LIMITS ESTABLISHED 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 PROP-
 ERTY.
   (C)  "BOARD"  MEANS THE ADVISORY BOARD CREATED PURSUANT TO SUBDIVISION
 SIX OF THIS SECTION.

 S. 4040--A                          3
 
   (D) "FUND" MEANS THE COMMUNITY HOUSING  FUND  AUTHORIZED  PURSUANT  TO
 SUBDIVISION TWO OF THIS SECTION.
   (E)  "FIRST-TIME  HOMEBUYER"  MEANS AN ELIGIBLE INDIVIDUAL WHO HAS NOT
 OWNED A PRIMARY RESIDENTIAL 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) "ELIGIBLE INDIVIDUAL" MEANS A HOUSEHOLD WITH AN INCOME  THAT  DOES
 NOT  EXCEED  ONE  HUNDRED PERCENT OF THE INCOME LIMITS AS ESTABLISHED 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.
   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,
 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 COMMUNITY
 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 FINANCIAL ASSISTANCE TO FIRST-TIME HOMEBUYERS WHO
 ARE RESIDENTS OF THE TOWN FOR THE PURCHASE OF A FIRST HOME.  SAID FINAN-
 CIAL ASSISTANCE MAY BE IN THE FORM OF GRANTS OR LOANS.
   (1) A TOWN MAY PROVIDE FINANCIAL ASSISTANCE TO A FIRST-TIME  HOMEBUYER
 WHO  IS  A  RESIDENT  OF THE TOWN OR WHO IS EMPLOYED IN THE TOWN FOR THE
 PURCHASE OF A FIRST HOME. A RESIDENT OF THE TOWN SHALL INCLUDE A  PERSON
 WHO IS CURRENTLY A RESIDENT OF THE TOWN OR A NON-RESIDENT WHO HAS BEEN A
 RESIDENT WITHIN THE PAST FIVE YEARS.
   (2)  SAID  FINANCIAL  ASSISTANCE SHALL NOT EXCEED FIFTY PERCENT OF THE
 PURCHASE PRICE OF THE HOME.
   (3) IF SAID FINANCIAL ASSISTANCE IS IN THE FORM OF A LOAN,  SAID  LOAN
 SHALL  BE  REPAYABLE TO THE TOWN PURSUANT TO THE TERMS AGREED TO BETWEEN
 THE RECIPIENT AND THE TOWN, PROVIDED THAT, AT A MINIMUM, ANY LOAN  SHALL
 BE FULLY REPAID BY THE RECIPIENT UPON THE RESALE OF THE HOME.
   (4)  FOR THE PURPOSES OF CALCULATING TOWN TAX LIABILITY FOR SUCH PROP-
 ERTY, ONLY, THE DOLLAR  AMOUNT  OF  ANY  FINANCIAL  ASSISTANCE  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.
   (5)  ALL  REVENUES  RECEIVED  BY THE TOWN FROM THE REPAYMENT OF A LOAN
 SHALL BE DEPOSITED IN THE FUND.
   (6) A TOWN MAY PROVIDE FINANCIAL ASSISTANCE FOR COMMUNITY  HOUSING  IN
 CONJUNCTION  WITH  A  PUBLIC/PRIVATE  PARTNERSHIP  FOR EMPLOYER ASSISTED
 HOUSING.

 S. 4040--A                          4
 
   (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 COMMUNITY HOUSING FOR
 RENTAL TO ELIGIBLE INDIVIDUALS EITHER BY THE TOWN OR  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; AND
   (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.
   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 IN THE PECONIC BAY
 REGION MAY ESTABLISH THE FUND, THE TOWN BOARD SHALL FIRST ADOPT  A  TOWN
 HOUSING  PLAN WHICH ESTABLISHES AN IMPLEMENTATION PLAN FOR THE PROVISION

 S. 4040--A                          5
 
 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-
 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 ENSURE 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 ENSURE THAT ALL COMMUNITY HOUSING CREATED PURSUANT
 TO  THIS  SECTION  REMAINS  AFFORDABLE.    SUBSEQUENT PURCHASERS OF SUCH
 COMMUNITY HOUSING SHALL HAVE AT THE TIME OF PURCHASE,  PURSUANT  TO  THE
 DEFINITION  "ELIGIBLE  INDIVIDUAL",  AN  INCOME THAT DOES NOT EXCEED ONE
 HUNDRED PERCENT OF THE INCOME LIMITS AS ESTABLISHED BY THE STATE OF  NEW
 YORK  MORTGAGE AGENCY LOW INTEREST RATE LOAN PROGRAM IN NON-TARGET CATE-
 GORIES FOR SUFFOLK COUNTY.
   (F) SUCH PLAN SHALL PROVIDE FOR THE EQUITABLE DISTRIBUTION OF COMMUNI-
 TY HOUSING OPPORTUNITIES AMONG ALL THE COMMUNITIES OF THE TOWN. THE PLAN
 SHALL ENSURE THAT NO COMMUNITY IS SITED FOR AN  UNDUE  CONCENTRATION  OF
 COMMUNITY HOUSING OPPORTUNITIES THAT WOULD SUBSTANTIALLY ALTER THE CHAR-

 S. 4040--A                          6
 
 ACTER  OF THE COMMUNITY. IN DETERMINING EQUITABLE DISTRIBUTION OF COMMU-
 NITY HOUSING OPPORTUNITIES, EXISTING COMMUNITY HOUSING OPPORTUNITIES  IN
 A COMMUNITY SHALL BE CONSIDERED.
   8. VILLAGE PARTICIPATION.  (A) THE PARTICIPATION OF ANY VILLAGE IN THE
 COMMUNITY  HOUSING  PROGRAM  AUTHORIZED  BY THIS SECTION SHALL BE AT THE
 OPTION OF THE VILLAGE. IN ORDER TO PARTICIPATE, A VILLAGE SHALL  PASS  A
 RESOLUTION  OPTING  INTO THE PROGRAM AND SHALL SUBMIT SAID RESOLUTION TO
 THE TOWN BOARD.
   (B) WHERE A VILLAGE 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 APPLICABLE LEGAL AUTHORITY,
 IN ORDER TO ESTABLISH THE RIGHTS AND RESPONSIBILITIES OF EACH GOVERNMENT
 REGARDING COMMUNITY HOUSING OPPORTUNITIES.
   9. INTERMUNICIPAL AGREEMENTS. NOTWITHSTANDING ANY PROVISION OF LAW  TO
 THE CONTRARY, TOWNS IN THE PECONIC BAY REGION MAY ENTER INTO INTERMUNIC-
 IPAL  AGREEMENTS PURSUANT TO ARTICLE FIVE-G OF THE GENERAL MUNICIPAL LAW
 FOR PURPOSES CONSISTENT WITH THIS SECTION.
   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

 S. 4040--A                          7
 
 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
 THE  RECORDING  OF THE CONTRACT, PAYMENT OF A DEPOSIT OR OTHER FACTS AND
 CIRCUMSTANCES AS DETERMINED BY THE TREASURER. ANY TAX  IMPOSED  PURSUANT
 TO THIS SUBDIVISION SHALL BE ADMINISTERED AND COLLECTED IN A LIKE MANNER
 AS THE TAX IMPOSED BY SUBDIVISION ONE OF THIS SECTION.
   §  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.
   (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.
   (C) THE PROVISIONS OF THIS SUBDIVISION SHALL ONLY APPLY TO CONVEYANCES
 FOR  RESIDENTIAL PROPERTY WHERE THE CONSIDERATION IS TWO MILLION DOLLARS
 OR LESS.
   § 6. Subparagraph 1 of paragraph  (a)  of  subdivision  4  of  section
 1449-ee  of  the tax law, as amended by chapter 389 of the laws of 2014,
 is amended to read as follows:
   (1) in the towns of Southampton, East Hampton and Shelter Island,  the
 primary  residential  property  is  within  one  hundred  [twenty] FIFTY
 percent of the purchase price limits defined by the state  of  New  York
 mortgage agency low interest rate mortgage program in the non-target one
 family  categories for Suffolk county in effect on the contract date for
 the sale of such property;
   § 7. 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.
   § 8. This act shall take effect immediately; provided,  however,  that
 the  amendments  to sections 1449-bb and 1449-ee of the tax law, made by
 sections four, five, and six of this act shall not affect the repeal  of
 article  31-D  of  the tax law and shall be deemed to be repealed there-
 with.