Assemblymember Fred W. Thiele, Jr. (D-Sag Harbor) today announced that he has re-introduced the Accessory Dwelling Unit Incentive Act to address the statewide affordable housing crisis and incentivize property owners to construct accessory dwelling units where such units are permitted.
The Accessory Dwelling Unit Incentive Act (A.1401) would create the following new incentives to encourage homeowners to construct ADUs:
- The establishment of the “Accessory Dwelling Unit Forgivable Loan Program.” The upfront capital cost of constructing ADUs is one of the biggest impediments to their creation. The loan program, administered by the Division of Housing and Community Renewal, would provide property owners with a forgivable loan of up to $75,000 for 20 years to construct an ADU. If the property owner rents the ADU to tenants meeting affordable income and rent guidelines for the 20-year loan period, the loan would be forgiven and become a grant.
- The establishment of an income tax credit for a property owner with a legal ADU who rents it under affordable occupancy, rent, and income guidelines. The amount of the credit would be 50% of the difference between the market-rate rent and the affordable rate rent, not to exceed $10,000 per tax year.
- The establishment of a real property tax exemption for a property owner who constructs a legal ADU and rents it in accordance with affordable occupancy, rent, and income guidelines. Local governments would be authorized to grant a property tax exemption equal to 100% of any increase in assessed value of the property attributed to the construction of the ADU.
Assemblymember Fred Thiele said, “Accessory dwelling units can be part of the solution to provide affordable multi-generational housing options to workers and families. Incentives, not mandates, are the best approach to make the existing housing stock more attainable. Local governments should be our partners in addressing the need for affordable housing on Long Island and across New York. The State should provide resources such as technical assistance, model local laws, best practices and funding to local governments to implement a workable accessory dwelling unit program.”