Housing Task Force

Housing Task Force Meeting #9 Minutes Thursday, March 28, 2024 7pm Village Hall Conference Room Attendants: Chester Edwards, Monica Fonseca, Jane Lippman, Kathy Pandekakes, Aldo Vitagliano, Andrew Weiss, Ursula Winchell Absent: Margaret Adamson, Arley Arno, Lisa Cordasco, Catrina Shivers, Luis Yumbla Guest Speaker: Howie Ravikoff Meeting opened at 7:02pm Meeting minutes for March 14, 2024 were approved unanimously by motion made from Aldo Vitagliano and seconded by Andrew Weiss. Intro and Bio of Howie Ravikoff was discussed. He is a local landlord that owns several properties, both residential and commercial. He is a member of the Building and Realty Institute of Westchester and the Apartment Advisory Council. The definition of affordable housing was discussed. New York State has a definition of affordable housing and communities have different views. There’s affordable housing in tax credit projects, in different funding streams, and at different AMI levels. Affordable Housing has clear definitions and most often relates to new housing developments and the state requirement for a 10% set-aside for what is considered affordable, and the definitions fall into place after that. Area Median Income is determined for our entire county and includes wealthy neighborhoods. Grouping everyone together may not be the proper way to determine affordability in each municipality. Specific definitions of what affordable means, in terms of Port Chester, will help specify our recommendations. If the state is defining affordable then that would be where to start. New development in Port Chester has a State required minimum of affordable units according to the State’s definition and the County’s AMI based on income earning adults. Mr. Ravikoff feels it’s a great disservice to only focus on affordable housing for new developments and not focuses on existing stock. His company finds a building that needs renovations or repurposing and fixes it up to rent. The resolution establishing our committee was read aloud, which includes finding affordable housing opportunities in the existing housing stock as well. Kathy Pandekakes said there is a way to do tax credit projects on small existing properties to bring affordable housing to communities. Mr. Ravikoff stated that our Committee has to find a way to help existing owners keep their structures and tenants. It’s increasingly difficult to maintain an older building. There is more than just repairs and maintenance, but also insurance rates which have tripled in the last five years. Many insurance carriers won’t even look at Port Chester because it has a flood zone, which limits competitive insurance markets. Existing landlord owners have rents that are far below the “affordable rents” proposed for new developments. ETPA rules apply to buildings with 13 units or more built before 1974. Buildings with 12 and fewer are not affected by ETPA. The 2019 HSTPA laws are incredibly restrictive to an owner and designed to keep a tenant in their apartment. Many tenants have aged out of the work force and can’t keep up with rent. These laws further restricted landlords from increasing the rent and as a result many buildings are falling into disrepair. If Port Chester can help in any way to aid landlords in continuing to maintain their buildings, it would benefit both the landlords and the tenants. Good Cause Eviction Laws that are currently being negotiated on the State level were also discussed. These laws would affect every residential rental in the State and allow renewal of the lease continually every year unless in default for non payment. Mr. Ravikoff has 29 ETPA units in Port Chester (around 10% of Port Chester’s total ETPA units) and his company manages its own units only. ETPA rent regulated units are regulated by Westchester County Rent Guidelines Board whom will dictate the rent increases on a one or two year lease on a yearly basis. There are successions of ETPA whereby adult children that grew up in the unit, and continue to live in the ETPA apartment are allowed to take over tenancy at the same ETPA rates. Prior to the 2019 HSTPA Law, the landlord could raise the rent by 20% upon a vacancy of the original tenants. There were other rules allowing unlimited amounts to renovate, with a portion of that amount able to be recouped on a monthly basis in perpetuity. The 2019 HSTP Law only allows landlords the opportunity to increase the rent upon a vacancy, provided there are capital improvements made. The maximum expenditure is $15,000 for improvements and updates, that can be recouped on a monthly basis of up to 15yrs. At the end of 15 years, the rent gets rolled back to what it was before the capital improvement, and can only be used once with no fluctuation based on apartment size. That type of expenditure would generally be put into a unit that’s past its useful life. With the 2019 HSTP, if you want to apply for the $15,000 incentive, it must be a third party that does the work, even if the landlord has its own management company and repair workforce. Does ETPA get more favorable tax incentives? Buildings with ETPA units make less income than a market rate building and the assessment reflects that because it’s based on the income level made. If the rents were market rate then the rates would go up. Port Chester could opt out of ETPA and choose to replace it with a better functioning alternative. The purchase price on an existing building and/or land, has to be low enough and the ability to re-develop has to be high enough for the numbers to work for a developer. The value that exists today and the potential value of tomorrow have to be determined in order to find the right balance. NYS Building Code, and the cost to comply with the code is expensive, and tends to force a developer to build a larger more dense project in order to make a profit. What is the range of rental rates for your units? The average rate for a two-bedroom apartment for my properties is around $2100 a month. One member stated that that is lower than the Westchester County Fair Market Rent for 2024 which is $2352 for a two-bedroom apartment per month. Mr. Ravikoff also has some apartments with Section 8, and he stated that it’s difficult to get CVR (Westchester County contractor for Section 8 Housing) to agree to those rent prices. They look for comparable apartments and often deny applications. As a landlord, he cannot deny the tenant, and must treat the Section 8 applicant the same as the market rate applicant. However, sometimes the voucher assistance takes between 2-4 months which delays full payment on the unit. Port Chester used to have its own Section 8 office, but now most municipalities in Westchester County turned over the Section 8 management to the County and their contractor. Mr. Ravikoff believes that the greatest disservice currently is that existing affordable housing buildings are being bought up and eliminated to make way for larger developments to be built. He feels that there is nothing new that can possible be built that will replace what’s being taken. There are BOT members that feel that PC has already provided enough of workforce housing for the entire County and surrounding Fairfield County, and that Port Chester should move on from that. The Village isn’t clear on what it wants. We have to be clear and consistent over time. Mr. Ravikoff feels that the Village leaders should be reaching out to all departments and asking what they need and what are their wish lists; what will they need projected out 5 and 10 years from now and then figure out how to get there; the same would be true for housing. What do you need today for housing? How do you provide for it? It’s his opinion that you can’t look at just new development to provide it. The Local Development Corporation could be instrumental, with their ability to get creative with zoning, to see affordable housing projects through, including on municipal property. There were studies done to move Village Hall and repurpose the land for housing. That is something that he believes our group should look at. Mr. Ravikoff is also part of a group through the Chamber of Commerce that’s comprised of all developers and himself. He suggests that our group speak to developers to see what can be built that would accommodate more affordable housing. How many units do you have? We don’t give particular numbers but if you drive around you will see our sign out front. What is your current vacancy on residential units? Zero Who rents your units? Are they from out of town or are they Port Chester residents? When we have a unit coming up or vacant, we put a sign in front of the building and the phone rings off the hook. I don’t have to advertise outside of Port Chester. I have one tenant that came from Mamaroneck, and another tenant whom was displaced from a unit in Port Chester and came back. Everyone else is a Port Chester resident. If Port Chester were able to rent their new affordable units to Port Chester residents, and one of the ways to do that is to change our zoning code, would there be people in Port Chester to rent those units? I don’t have a single tenant that would be able to afford those new affordable units. If the zoning were changed to make the new units more affordable would there be people in Port Chester to take those units? The developer would have to have a return/profit. If there is no significant profit then owners will take a loss and bench their apartments. There’s no economic return. There are incentives being considered to force landlords, or to offer incentives, to put their units back on the market but the financial equation must work. Is there value in repurposing big box retail into residential, like the G&S property for example? G&S is a big developer and you should ask them. If zoning allowed them to convert to residential what would they need from the village in order to make it financially feasible? In regard to demographics of the population, how does that impact housing and is there a way to cut out a piece for these demographic groups, like seniors or veterans, without harming other populations? We try to keep our tenants in their spaces as long as possible. We have no veterans but have a lot of seniors. Seniors are struggling right now with necessary rental increases. I would like to also see Port Chester implement housing for its municipal workers. If Port Chester can provide housing to its municipal workers it would support loyalty to the Village and keep things in Port Chester. What is the single most important change that needs to happen to allow a landlord to create more opportunities for affordable housing. The Village needs to decide what it is and what it wants and be consistent over time, regardless of who is on the BOT or the Planning Commission. Meeting closed at 8:01pm with motion made by Andrew Weiss and seconded by Ursula Winchell.