Affordable Housing and the Kingstonian Project PILOT

Affordable Housing and the Kingstonian Project PILOT

CLICK TO WRITE  (be sure to add your name and municipality at the end and any other message that you wish to include):  Request that the Kingston Common Council and in particular, the Council’s Finance Committee demand that the Kingstonian developers provide affordable housing guarantees in their PILOT agreement. 

By Rebecca Martin

In our recent post about the Kingstonian PILOT, we reported on the Ulster County Industrial Development Agency’s (UCIDA) consideration of a $30.6 million tax subsidy to real estate developers in exchange for parking spaces. We shared our concerns that a subsidy of this size to the Kingstonian for parking spaces means significantly less money to invest in City schools, streets, public housing, and infrastructure. “It increases the likelihood that already overburdened taxpayers will be forced to cover any fiscal gap with increased school and property taxes.”  We demanded that a true value be placed on the developer’s PILOT before a public hearing is held so that the residents of Kingston are fully aware of the role they are being asked to play.   READ “The Kingstonian Project: There is more at stake than just parking”

The Kingstonian PILOT: Where the public good is a parking garage

It isn’t clear how to affix a value on what will become a privatized parking garage funded by public through subsidies. We’ve got nothing but questions.

  • How many municipal spots will there realistically be for the City of Kingston?
  • What will the fee structure look like?
  • What will community members be asked to pay?
  • Is the parking garage being built for the average Kingston community member or for those with the means to afford luxury apartments?
  • What would the fiscal benefits be if the PILOT was disallowed?
  • Would the revenue stream remain the same?
  • Could the City of Kingston conceivably be better off building its own parking garage for $30.6 million dollars? 

Affordable housing for now, but for how long and at what cost?

Part of what has been portrayed as a public good for the Kingstonian are the 14 affordable housing units that were included last fall after much outcry from the community. Even though the Area Median Income (AMI) is high (presumably determined by the Kingston-Poughkeepsie MSA or some other measurement beyond Ulster County), it’s good to have an affordable component added to the project.  

Typically, not-for-profits (NFP) who are working on affordable housing projects receive state tax credits and in return are bound by rules.  In some cases, those units can remain affordable for up to 50 years. As a private developer, the Kingstonian isn’t relying on the state and therefore, can use the “affordable housing” language without being bound by the same rules.

The PILOT agreement at this point is perhaps the only avenue to provide guarantees that prevent the affordable units from escalating in value. It could outline the units’ starting rent, their size and annual escalator rate.  Without that outlined somewhere, the Kingstonians “affordable housing” could become market rate at any given time. 

In a recent PILOT analysis completed for the City of Hudson by Joshua Simons of the Benjamin Center, the report highlights key variables and standards in the region. Although the project in Hudson is all affordable housing created by a foundation (apples to oranges here), we presume that if the Kingstonian project were to do the same kind of study for its PILOT it would prove to be an anomaly. 

As the terms of the Kingstonian PILOT are not yet fixed, now is the time that our decision-makers and the public can request a full disclosure of the true value of the PILOT (in order to avoid the developer inflating the public benefits) as well as a clawback provision and affordable housing guidelines.

Beyond that, what revenues do the Kingstonian developers stand to gain on luxury apartments over 25 years? Even thought he PILOT process is well underway, we don’t know as the information is deemed ‘trade secrets’ as are the sources of financing which the developer refuses to reveal. 

It’s impossible to understand why decision makers are not insisting on making all of the developer’s information public given the expectation of tens of millions in subsidies. Without it, we can’t be sure that the Kingstonian project would require a PILOT at all. 

RESOURCES

New York State Low-Income Housing Tax Credit Program (SLIHC)    NYS tax credits for affordable housing

The Low-Income Housing Tax Credit (LIHTC)
Federal program for tax credits for affordable housing administered by the state

Image above provided by The Kingston News “Kingstonian: Listen to the Community” rally

1 thought on “Affordable Housing and the Kingstonian Project PILOT

  1. I was able to listen to this meeting remotely thanks to Kingston Citizens providing the instructions. Unbelievable that the Freeman had this already published – Noble must have wrote it after caucus and before the meeting? Pretty frustrating for listening audience who could not comment or see the documents the Committee members were referring to, but the developers could? The impassioned plea of how these developers had been working on this for 3 years and abiding by the terms of the RFP the City created for increasing parking, with ADA compliance was interesting(who created the RFP?). Some members said they walk around Uptown weekly and are dismayed by the dozen empty storefronts (but this project builds more commercial space?). The developers stated that they are committed to a $ 15 hour (That is the NYS scheduled Minimum Wage) living wage for all employees. The Public benefit calculations that (do not subtract the Cost of Community Services study that looks at how much the extra school, water, fire, police, sewer and road activity will cost the city) included scholarships to train interns at $ 20,000 year for 25 years in the hospitality industry? Sounds great but does that industry need to train employees? and what will $ 20,000 year be worth in 25 years (perhaps the City and School District could freeze salaries for 25 years)? The Assessor a clear advocate as well as the City Attorney, Mayor and Planner for the developer said that after the Developers spend $ 46 million (no details available) the full assessment would be he thinks be $19 million and that the starting point for the PILOT is the current seemingly low assessment and taxes on the what the Developers said is a falling down dilapidated warehouse in a “red hot uptown market” and not what taxes would be assessed on the City owned properties being given to Developers and the City owned property fair values are not subtracted from the Public benefit. Even after 3 years the developer said he didn’t know the parking requirements but that if more was needed they can use Kingston Plaza currently owned by one of the Developers. Well if parking in the Plaza is so free and openly convenient why are we even building parking? Nothing prohibits a breakup by partners or binds the current Plaza owner to keep providing free and open Public parking as alleged. Meanwhile the Members who stroll around uptown counting empty storefronts on the unwalkable sidewalks on Crown and Green streets and who approve trip and fall claims payouts year after year tout the ADA compliant gerbil-like elevated walkway to the Plaza – again not part of the project? Alderperson Michelle Hirsch kindly and respectfully indicated and voted no saying that this seems a bit too much to give away. Thanks for Alderperson at Large Andrea Shaut for impartial insights and helping Committee Chair Koop count the votes

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