Making sausage

Laws are like sausages; it’s best not to see them being made.

Around 30 NY Habitaters descended on our capital city this week to talk housing with our elected representatives. We do this most years, at this time, when the next state budget is being negotiated and new legislation is being considered.

This year’s advocacy effort is more important than most, as we have a piece of legislation making its way through the legislative and executive branches, and as funding for state housing initiatives is less certain than ever.

Our advocacy was focused on supporting our proposed legislation that allows local property assessors to reduce the tax assessment on subsidized owner-occupied homes that are purchased through a housing non profit organization with the use of state subsidies. Habitat often uses state subsidies, as well as other resources, to subsize the price we sell the home at to make it affordable to low-to average-income residents.

Even with subsidies, property taxes take up a disproportionate share of the total cost of the house payment. When Habitat reduces the cost of a home from, for example, a $350,000 construction cost to a $200,000 subsidized sale price, the tax assessor typically assesses these properties at fair market value - which often is now above the cost of construction - instead of the subsidized sale price. This again makes the home unaffordable because the tax burden is disproportionately high compared to the price actually paid.

Habitat homes are usually subject to long term covenants from Habitat or the state that restrict resale and/or limit equity gains, and thus should be assessed at a lower rate. Fair market assessment also subverts the intention of state-funded efforts to promote affordability and disproportionately burdens the residents we are all working to assist.

The good news is that we are finding little philosophical resistance to the logic or fairness of our legislative effort. In fact, many assessors, towns and legislators support the initiative; they want and need to see it enshrined in tax law so that all can play by the same rules.

Further good news is that NY Governor Kathy Hochul has included a version of our bill in her current budget proposal. The language of the governor’s proposal is different in some significant ways from the Assembly and Senate bill, so there will be wrangling negotiations to come. The Senate/Assembly provisions are more generous and easier to adopt by local authorities.

Being New York, the final outcome of the negotiation is uncertain. We will persist in our efforts to get to the outcome we need, so we can build more. We can only hope that our voices and presence lead our public servants to doing what is right for their consitituents.

“There comes a time when one must take a position that is neither safe, nor politic, nor popular, but he must take it because conscience tells him it is right.” - Martin Luther King Jr