Riverhead Town has to decide if it will participate in the Peconic Bay Community Housing Fund, which officials say could create a fund to generate more than $600 million for affordable housing on the East End.
While the .5% tax requires voter approval in each of the five East End towns, municipalities first have to vote on adding the referendum to the ballot.
Homebuyers in East End towns already pay a 2% transfer tax into the Peconic Bay Community Preservation Fund, which is used to purchase and preserve open space. That program has been more successful in the other towns, officials said.
“Our CPF experience here in Riverhead is very different from the South Fork, and even Southold Town, because there’s so many very expensive houses there,” said Riverhead Community Development Agency director Dawn Thomas, who discussed the fund at last Wednesday’s Town Board work session.
Since the CPF was approved by voters in 1999, it has generated $1.81 billion, according to South Fork State Assemblyman Fred Thiele (I-Sag Harbor).
But while Southampton Town has generated more than $1 billion in CPF funds and East Hampton Town generated over $520 million, Riverhead Town has only generated $77 million during that same time period.
A recent planning study said Riverhead Town has 2,300 units of affordable housing units, including rentals, Ms. Thomas said.
The South Fork towns have very little affordable housing, she said.
“Riverhead has been incredibly responsible over the years in developing affordable housing of every size, shape and type,” Ms. Thomas said.
She added that the town is more interested in home ownership than rentals.
The town could also choose to do nothing.
“You are not required to proceed with this amendment and increase the 2% tax to 2.5%,” Deputy Town Attorney Annemarie Prudenti told the Town Board.
But if the town is interested in putting the issue up for a vote in the fall, the first step would be to adopt a local law establishing a fund. The second step would be a local law to create an advisory board.
The advisory board would put forth recommendations for the community housing fund plan.
“My only concern is that CPF is traditionally used for preservation efforts, that’s what it’s really meant for,” said Councilman Frank Beyrodt. “To attach this to the CPF just seems like it’s getting away from the original intent of it.”
Ms. Prudenti said that over the years, the CPF has been used for preservation of farmland and open space, then water quality projects, and now it’s being proposed for development of affordable housing.
“It’s gone from preservation to development,” she said.
If the town wants to proceed with the Community Housing Fund referendum in November, it will need to get a ballot proposition to the Suffolk County Board of Elections by Aug. 8, officials said.