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Housing help on East End part of legislator's end-of-session push

An aerial view looks southeast across Southampton Village

An aerial view looks southeast across Southampton Village on April 30, 2015. Credit: Doug Kuntz

State lawmakers from eastern Long Island are trying to pass bills to ease the Hamptons housing crunch before the scheduled end of the legislative session Wednesday.

Assemb. Fred Thiele Jr. (I-Sag Harbor) is pushing a bill that would allow the five East End towns to impose a "McMansion tax" on the construction of homes exceeding 3,000 square feet. The fee would help fund town loans of as much as $250,000 to first-time home buyers.

The bill was in the Assembly housing committee Tuesday. "It's still in the mix, but I don't have a definite answer yet as to whether it's going to pass," Thiele said.

Sen. Kenneth LaValle (R-Port Jefferson) sponsored a bill that passed the Senate on June 8 to allow the creation of special funds for the construction of affordable housing and aid to first-time home buyers on the East End. It is awaiting a vote in the Assembly.

Both laws are designed to help alleviate a housing shortage for people who live and work year-round in East Hampton, Southampton, Riverhead, Southold and Shelter Island.

Newsday reported last month that a growing post-recession demand for seasonal homes and rentals in East Hampton and Southampton was forcing some workers into homelessness and causing others to leave.

Town officials said the housing shortage has made it difficult for Hamptons businesses to find local employees and for fire departments to find volunteers. And as more workers move and commute from Riverhead and Brookhaven, traffic on the South Fork has worsened, they said.

LaValle's bill, which passed 46-16, would allow each town to create a "community housing opportunity fund," but does not specify where funding would come from. It would require public referendums in each town. "It's critically important that we provide towns with the tools to battle the loss of our young adults," he said in a news release.

In Thiele's bill, the towns could impose a $10 fee per square foot of home construction above 3,000 square feet, and use the funds to offer loans to eligible home buyers. Homeowners would repay the loans when they sell their houses, and the amount owed would increase in proportion to a home's value. The program would also require a referendum in each town.

The East End towns adopted a similar strategy for preservation of open space in 1998. Voters in the five towns approved a 2 percent tax on most real estate transfers to fund purchases of natural space and farmland. High-dollar home purchases helped the "community preservation funds" raise more than $1 billion since their inception.

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