New York lawmakers propose new state agency to build affordable ‘social housing’
New York lawmakers want to create a new publicly-funded agency to address the state’s ongoing affordable housing crisis. State Sen. Cordell Cleare and Assembly Member Emily Gallagher on Tuesday introduced a bill proposing the creation of the Social Housing Development Authority (SHDA), a new agency that would use state money to finance the creation of permanently affordable, 100 percent union-built housing, instead of relying on private developers. According to City Limits, SHDA would create “social housing,” a term used to describe developments typically owned by public entities, non-profits, or the residents themselves.
As outlined in the proposal, SHDA would act as an alternative to private sector development, which the legislation’s sponsors claim has failed to produce enough housing to adequately address the state’s housing crisis.
SHDA would be able to purchase and enhance existing housing across the state and convert it into social housing, as well as construct and maintain different types of mixed-income homes. These include publicly-owned rental apartments, Community Land Trusts (CLTs), and affordable co-ops that feature community control.
Residents in SHDA developments would put no more than 25 percent of their gross income towards housing costs, and the authority would require at least 25 percent of the housing it creates to be designated for households earning 30 percent or less of the area median income (AMI). Additionally, no more than 30 percent of SHDA units could be occupied by residents earning 100 percent or more of their local AMI.
While SHDA could partner with private developers and property managers, the agency could still retain ownership of the new homes, according to the New York Times. The continued affordability of the new developments would be ensured since they would not need to make the same profit as private developments.
SHDA would aim to create 26,000 affordable homes using union labor funded by a $5 billion injection from the state budget and the issuance of bonds, according to City Limits. While the agency would require state funding initially, it would also use bonds and use the money from paid rent to pay off interest, according to the New York Times.
“After a half century of subsidizing developer profits, it’s clear that the private sector is incapable of producing affordable housing at the scale necessary to meet this crisis. We can chart a different path,” Gallagher said in a post on X.
The proposal is being made as an alternative to the state’s expired 421-a tax abatement program, which gave developers a tax break if they included a certain percentage of affordable housing in their new buildings. Gov. Kathy Hochul’s previous proposals to replace the program in 2022 and 2023 failed in the state’s legislature.
During her 2024 State of the State address in January, Gov. Kathy Hochul once again called for the replacement of 421-a and an extension of the completion deadline for the expired program.