Objectively, the Peconic Bay Region Community Preservation Fund has been a massive success.
Funded by a 2 percent transfer tax on real estate sales in the five East End towns — East Hampton, Riverhead, Shelter Island, Southampton and Southold — the fund has raised about $1.6 billion and preserved 10,000 acres of East End land in its two decades of existence.
Each town collects and distributes the revenue as it sees fit, using it for the purchase and preservation of open space, farmland and historic sites, the development of parks or taking on water quality initiatives.
At the time of its establishment by voter referendum in 1998, the CPF’s annual revenue was projected to be $15 million. The fund has generated an average of $70 million per year since then. Revenues reached an all-time high in 2020, when $139.42 million was collected — a 79 percent increase over 2019.
“Revenues for the CPF continue to reflect the significant increase in real estate activity on the East End since the advent of the pandemic,” said State Assembly member Fred Thiele, who authored the original bill that created the fund. “The last seven months have all exceeded $15 million per month. The CPF generated nearly the same amount of revenue in the first four months of 2021 as all of 2019.”
In Southampton, the organization’s funds were used to purchase the Pyrrhus Concer historic site (the home of a formerly enslaved person who became a successful whaler, entrepreneur and local philanthropist) and helped rebuild the Sag Harbor Cinema after it burned down.
In East Hampton, CPF funds purchased development rights to 60 acres in Wainscott in 2001, which is now a preserve administered by the Nature Conservancy. In 2014, $9.66 million in CPF funds were used for the preservation of the historic 3.7-acre Gardiner Home Lot.
In 2010, Southampton spent $5 million to purchase and preserve the Links, a 150-acre tract in East Quogue. Suffolk County contributed an additional $5 million.
But the priciest purchase in the village was a $14.05 million investment in Beach Plum Meadows. The 11-acre property, which was once considered for senior housing, is now a park.
“We’ve done an amazing job with the projects to which we can apply the funds,” said Southampton Town Supervisor Jay Schneiderman, who previously held the same position in East Hampton from 2000 to 2003. He mentioned “water quality improvement [and] preserving historic pockets of our town where we can assist homeowners” as two successful projects.
So far, so good. Is there a downside? Is it possible that overprotection stifles economic growth and kills jobs? What about the consequences of decreasing developable land? Does that increase land value and make the area even more unaffordable?
“When you decrease the availability of developable land and you increase the value, it can make it harder for the workforce to stay within a community,” said Schneiderman.
Younger people, including Schneiderman’s own children, either don’t want or can’t afford to live in the area, and longtime working families are being priced out of their towns.
Assemblyman Thiele agreed, noting that the dearth of affordable housing in the area has “reached crisis proportions.”
“Local employers have difficulty hiring and retaining employees because of housing costs and availability,” he said. “Local volunteer emergency services are experiencing difficulty in recruitment and retention. Longtime residents are forced to leave the area. This has all been made worse by the Covid-19 pandemic, which is driving up the second home real estate market on the East End.”
The solution: another fund.
Earlier this year, Thiele introduced legislation authorizing the same five towns to establish a Town Community Housing Fund, to be supported by a 0.5 percent supplement to the existing 2 percent tax that funds the CPF. The bill passed the State Assembly in May, but its implementation remains subject to approval by the town boards and, ultimately, a voter referendum.
If approved, the Community Housing Fund would support such initiatives as providing financial assistance to first-time homebuyers worth up to 50 percent of the purchase price and developing community housing from new or rehabilitated properties.
Most everyone agrees that the CPF was an outstanding piece of legislation, which has succeeded beyond its originators’ wildest dreams. Now, advocates say, it is time for community housing to receive the same treatment, so that local communities can be preserved as well.
The post What’s next for the East End’s community preservation fund? appeared first on The Real Deal Los Angeles.
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