Islip grants up to $1.5M in tax breaks to Oakdale apartments that will be home to developmentally disabled

Islip Town granted nearly $1.5 million in tax breaks to a planned apartment complex in Oakdale that will reserve half its units for disabled or lower-income residents.

The nearly $15 million project includes 10 two-story apartment buildings on a five-acre property at 405 Locust Ave. It will have a total of 40 units, which will be divided evenly between one-bedroom and two-bedroom apartments.

Islip’s Industrial Development Agency board unanimously approved up to $1,484,250 in tax breaks for the development last month through a deal that requires 12 units to be reserved for people with developmental disabilities.

The agreement requires another eight apartments to be affordable for residents making 80% of the median family income for Long Island. That means a family of three earning roughly $118,800 could afford rent without spending more than 30% of their gross income, according to the U.S. Department of Housing and Urban Development standards.

Those 20 specialized units will remain price-controlled or reserved for the disabled “in perpetuity,” even though the tax breaks conclude a decade after construction is finished, according to John Walser, Islip Town's director of economic development.

“More so than really any population, I think there’s a critical need for housing for individuals with developmental disabilities,” he said. He citied New York Housing Resource Center figures showing that 63% of the 25,000 adults in Suffolk County with such disabilities live with family caregivers.

People's Arc of Suffolk CEO John McGuigan, whose nonprofit serves people with disabilities on Long Island, lauded the integration of people with disabilities and typical residents in the same housing complex.

“This is like the next level of service options that honor peoples’ ability to live their own lives," he said. "You’re creating a better opportunity for people with disabilities to be at the heart of a community, so they can build their own relationships with their neighbors." 

Walser said the units will remain affordable or for disabled residents permanently because of a covenant placed on the property by its current owner, Family Residences and Essential Enterprises Inc. The nonprofit, also known as FREE, provides a range of services to people with disabilities.

“The idea that it’s in perpetuity is very important because that becomes a problem when the development ages out, and then, where are these people going to live?" said Ian Wilder, executive director of Long Island Housing Services. "I really like the plan. ... It has pieces that are very important." 

The development is a joint venture between FREE and Oak Tree Development RE LLC, according to Walser. 

FREE runs day habilitation programs, provides employment for individuals with disabilities and operates a mental health clinic out of the roughly 28,055-square-foot building that’s on site. That building will be demolished to make way for the nearly 36,564-square-foot apartment complex.

Those services and FREE employees that work on-site will be transferred to other facilities and “no jobs will be lost,” according to a report by VHB Engineering that was filed as part of the project’s IDA application.

Newsday was unable to reach either FREE or Oak Tree Development RE LLC for comment on the project.

Walser said the units reserved for people with disabilities will be for those who are capable of caring for themselves.

"It's a much-needed addition to the menu of options that people with disabilities can choose from," McGuigan said.

Islip’s five-member IDA board on Dec. 16 granted the project between $471,750 and $494,250 in sales and mortgage recording tax breaks, as well as property tax discounts of about $990,000 over 10 years.

The developers will still pay a portion of their property taxes during that period. Walser said the property currently pays nothing in property taxes because it’s owned by a nonprofit.

The complex also promised to create between two and eight permanent jobs, according to the IDA executive director and the developer's IDA application materials. But Walser noted “that’s not the policy objective here — it’s housing."

“Obviously, there’s a need for housing for this community. So, that’s the policy objective that's being fulfilled,” he said.

Wilder, of Long Island Housing Services, told Newsday "it’s very important to think this way, especially when … our tax dollars are providing benefits; developments should be providing benefits back to the community."

By Sam Kmack

sam.kmack@newsday.com

Sam Kmack covers the Town of Islip for Newsday. He is a graduate of the University of Southern California and previously worked as a city watchdog reporter in the Phoenix metro area, as well as an investigative journalist at the Arizona Center for Investigative Reporting.