The state budget signed by New York Governor Kathy Hochul last week includes investments to build and preserve homes and expand infrastructure, as well as legislation intended to help first-time homebuyers enter a challenging market.
To learn about how the $254 billion state budget affects would-be buyers, WAMC’s Lucas Willard spoke with Michael Borges, Executive Director of the Rural Housing Coalition of New York.
Well, I think the legislature and the governor made targeted investments in addressing the housing crisis in the state. Specifically, one of the items that was included early on in the executive budget and made it into the final budget was $100 million in infrastructure funding tied to housing, pro-housing communities in particular. We in rural areas feel that the lack of infrastructure is often an impediment to building new housing. So, we were pleased with that. Also, there was additional investments in program housing programs that address the specific needs of rural housing projects, because a lot of the bigger programs don't really apply or applicable to rural areas. So, there was some investments in some of the smaller programs, like the Small Rental Development Initiative. SRDI, it's called it was an increased from $7 to $10 million and that helps with the construction of affordable housing of four to 20 units. So very pleased with that as well.
Now you had mentioned infrastructure being one of the impediments for developing housing in rural areas, and we often think of when governments seek to build housing, that the easiest place to do that might be in cities, where there's more people and the infrastructure is already there in the ground. But what, beyond infrastructure, are some of the hurdles that rural communities face, even some that may want to build housing or homes and they need some state help on?
Yeah. So, the three main obstacles are infrastructure. Lack of infrastructure was one. Two was lack of local capacity. And again, the budget had additional funding, about a 6% increase in funding for rural housing nonprofits that undertake a lot of the work that's done in rural areas of the state, and then the last was a targeted programs for rural communities. So, we touched upon that earlier talking about the Small Rental Development Initiative, which really is targeted to, again, small rural communities that lack infrastructure, because this program would help fund the development of four to 20 units, where most of the like tax credits and some of the larger programs are really targeted to 60, 100 units of affordable housing, which are not suitable for small rural communities. So, there’s that. There was also funding for the USDA 515 preservation program, and that's a new thing that we got funded last year in the budget, and that helps with the preservation of, again, affordable rental housing in rural areas that were that was built by the US Department of Agriculture back in the 80s and 90s. Those mortgages are expiring on those properties, and they're 30 years old, so they need a lot of work to maintain their affordability and their availability to rural residents. So, we're very pleased with that as well.
One of the items in the budget is a restriction on large companies, private equity firms, from purchasing single family and two-family homes. They have to wait 90 days before making that bid. What do you think about this legislation that's included in the budget?
Yeah, it's a real problem with investment firms, real estate speculators buying up properties, whether they're single family homes, mobile home parks are been targeted in the past. So, we applaud the efforts to limit the ability of these third parties to scoop up properties and take them off the market and have a negative impact, really, on the communities in which they're located.
Is there any legislation that your organization advocated for that didn't make it over the finish line and you're hoping to see some action on before the end of the legislative session?
Yeah, I mean, we are hoping to get some legislation passed that would make permanent in state statute, the Small Rental Development Initiative, which is only really in budget language. We'd also like to see some permanency in state statute for the Mobile Home Replacement Program, it's called MMHR, that would allow for an increase in grants to replace dilapidated and unsafe mobile homes, and because in New York, about 10% of the housing stock in rural communities is made up of mobile homes, and the state needs to step up and do more to protect that valuable affordable housing option for rural communities.
Obviously, the state budget comes at a time when there's a lot of change in federal policy and withholding of funds and a lot of uncertainty as well. Are there any programs that are seeing cuts right now, or you're worried may see cuts that could impact homeowners or prospective homeowners in rural areas?
Yeah. I mean, there were cuts even last year before Trump took office to the USDA, the US Department of Agricultural rural housing programs, and so we've seen further additional cuts in that area, and the president’s proposed budget also continues that trend, so that you know that will trickle down to rural communities, which do rely on a lot of these grants and loans, subsidized loans, to afford to buy housing and build housing so that is continued to be a concern, and we'll see what happens in Congress, see if they step up to protect these programs.
Well, Michael, thank you so much for your time. I appreciate it.
Thank you.
