Moving forward on affordable housing: Info, questions about accessory dwelling units

Workshops for contractors and residents at the Library on April 22 on creating accessory dwelling units (ADUs) on properties for affordable housing could be a sign that the community is embracing the concept as never before.

ADUs are spaces in existing properties where apartments might be created in either a main house or an accessory building. Supervisor Gerry Siller has said that action on ADUs is a priority in bringing affordable housing to Shelter island

About a half dozen contractors were present with questions about how the program would work in houses or accessory buildings — such as barns or garages — by constructing from scratch or bringing properties up to code.

It was standing room only for the second session, with property owners of all ages in the Library’s meeting room.

The town is benefiting from a $2 million New York State grant secured for the Island by the Community Development Corporation of Long Island (CDCLI). Homeowners who meet financial and other criteria could get up to $125,000 toward the cost of work to create ADUs, and if projects run over that amount, the CDCLI has a low-cost loan program that could bridge the gap.

Only 10 communities statewide, including Shelter Island, have qualified for the grant program.

The state put a two-year limit on completing projects and the clock began ticking on March 20.

That concerned contractors at the meeting, who pointed out some projects might be delayed because of slowdowns in getting materials and, for some projects, permits from either the Suffolk County Department of Health Services or the New York State Department of Environmental Conservation. Plus, all projects approved must meet the town’s zoning code.

CDCLI President Gwen O’Shea said she would contact those administering the state grants to see if they would agree to extend the time for projects already underway.

The grants are set up to provide direct payment to contractors to avoid property owners from being taxed. But there are still questions about how changes to  properties might be taxed locally.

The CDCLI expects to begin processing applications from those who want grants to create ADUs by the beginning of June. In the interim, Ms. O’Shea suggested those who now think they might qualify for grants to fill out forms indicating an initial interest. The form to express interest in a grant is available at shelterislandtown.us/community-housing-board.

A pamphlet containing general information on ADUs is available at Town Hall.

If all projects that pass muster need the full $125,000 in funding, there would be 16 grants. For some that have minor needs to bring properties up to code, the amount could be less, making money available for more projects.

Although the state doesn’t require the units to be affordable, the town can restrict rental prices to affordable standards.

Contractors have to be qualified by the CDCLI, including being properly licensed and meeting standards for minority- and women-operated businesses. Property owners have to choose from those qualified for their projects.

But Ms. O’Shea said property owners can’t hire relatives who are contractors.

On the other hand, they can create ADUs for relatives who would need a lease, but don’t necessarily have to pay any rent. The CDCLI needs to review leases annually and if a renter leaves, the organization will aid in getting another renter.

The owner of a property that is approved for a grant must agree to make an ADU available as a year-round rental, not a vacation rental, for 10 years. A property owner can also opt to live in the ADU and rent the main house.

If the owner sells the property or it passes to a new owner as a result of a trust or will in less than 10 years, the new owner can maintain the ADU to complete the 10-year requirement or sell the property and pay back a pro-rated amount that would be due to the CDCLI for the remainder of the required period.

There was a suggestion about the town moving to make ADUs affordable in perpetuity,  which is the aim of the Community Housing Board for any affordable housing created on the Island.