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Preservation Fund collects record $12.6M revenue in December

Assemb. Fred Thiele Jr. (I-Sag Harbor) sponsored the

Assemb. Fred Thiele Jr. (I-Sag Harbor) sponsored the legislation to create the Peconic Bay Community Preservation Fund, which will expire in 2030. Credit: Kathy Kmonicek, 2010

A large backlog of high-end housing on the East End and favorable tax deductions for real estate investments helped the Peconic Bay Community Preservation fund amass a record $12.64 million in December, the most in any month since the program began in 1999.

The money helped make 2013 the second-highest income year for the special fund, whose revenue is generated by a 2 percent tax on real estate transfers in the five East End towns (East Hampton, Riverhead, Shelter Island, Southampton and Southold). It excludes sales of small homes usually bought by first-time buyers.

"There was obviously a large [housing] inventory that backed up during the recession," said State Assemb. Fred W. Thiele Jr. (I--Sag Harbor), who wrote the legislation creating the fund. "The South Fork and the East End . . . rely to a large degree on the second-home market. It's a real estate based economy, and it has come out of the recession faster and stronger than other parts of the region."

The $95.43 million revenue in 2013 was second only to the $96.02 million recorded in 2007. In 2008, as the nation's economy crashed, the fund's revenue dropped to $56.63 million.

Each town keeps the money raised on sales within it, and 90 percent of the revenue must be used for land preservation, with the rest allocated for administrative costs and maintaining property already purchased.

Southampton, the largest town on the East End, has raised $515.3 million since 1999, well over half of the $884.7 collected across the area. Tiny Shelter Island brought in just $19.22 million over that period, although its increase this year -- from $1.3 million to $2.5 million -- was the biggest percentage gain of any town.

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