From Downtown Committee of Syracuse:
Are you aware of any types of incentives that are available for those looking to develop residential units in a downtown?
Check out the following link on our website: http://www.rochesterdowntown.com/downloads/FRAD.pdf. It lists all of the programs we know of to assist in developing downtown properties, including for housing uses. In particular, you'll note a relatively new local program -- CUE -- that provides a property tax abatement for housing conversion projects.
Orion Management Company – Amsterdam, NY
The primary financial incentives for downtown housing are:
1. New York Main Street program (50% grant, but limited to low income units)
2. HOME Program (can be used for owner occupied, such as condos, as well as rental units, but also restricted to low income)
3. HUD Community Development Block Grant (over half the units have to be low income)
4. AHC Affordable Home Ownership Program (owner occupied units such as condos, can serve up 130% + or - of median income)
5. Property Tax Abatement Programs
6. Niagara Mohawk (Now National Grid) Main Street Program
7. Low Income Housing Tax Credit (limited to low and very low income)
8. New York State Housing Trust Fund (limited to low income)
9. Federal Home Loan Bank AHP program (limited to low income)
There are lots of financial incentives to do housing projects, but most of them require low income housing as a primary component. I have done projects with most of the above funding sources, but I have been suggesting that if you really want to revitalize downtown, get some rich people living (and spending their money) downtown. However, it is hard to justify, from a political perspective, government subsidies to house wealthy people. Hence, very little is available to assist upscale downtown housing projects.
Consider Tax Credits, both historic, if applicable, and affordable (low) income housing credits. In many communities the LIHTC are actually used for work force housing. If you are looking at market rate, whatever that is, the historic may still applies if it is a historic rehab. Empire Zone credits may also help if the project is in a zone.
Interested parties should contact Thoma Development Consultants here in the city of Cortland. Thoma is under contract with the city to provide support for a number of initiatives, including downtown revitalization. The firm, on behalf of the city, has already secured dollars that might assist property owners with the kind of renovations/revitalization projects you mention. Those dollars have pretty much been spoken for, but I suspect there will be more opportunities down the road. I would suggest contacting Bernie Thoma or Rich Cunningham at (607/753-1433) for more information.
I asked the City of Binghamton a similar question – is funding available for developers to construct market-rate housing – at a meeting the City held last year to receive comments from local agencies on the City of Binghamton’s Housing Element and HUD funding requirements. I called for an update today. Here is the update:
HUD Funding: The City of Binghamton provides funding for low-cost and moderate-cost housing per HUD regulations. Contact Tom Martin, City of Binghamton Housing Director (607) 772-7028, for further information.
Economic Development Revolving Loan Funds for Mixed-Use Development: Anthony Brunelli received a revolving loan to fund the commercial development portion of his mixed-use (commercial and residential) development project in the downtown. The loan could not be used for the residential portion but the loan in essence freed up monies for the residential portion of the project. Because the loan was targeted to the commercial portion, there were no income restrictions on the housing. Contact Tom Martin, City of Binghamton Housing Director (607) 772-7028, for further information. Anthony Brunelli, Art Gallery (607) 772-0485.
There are numerous articles on the subject on the web. Three such articles are listed below:
Nashville Downtown Living Initiative (PDF) A report on the state of and possibilities for housing in downtown Nashville
Oakland CEDA - 10K Housing Initiative – Downtown Oakland Initiative to bring 10,000 new residents to downtown
Housing Conversion in Downtown Los Angeles: A Summary of Information from theDowntown Housing Database Housing Conversion in Downtown Los Angeles: A Summary of Information from the Downtown Housing Database
The City of Rome has developed three initiatives to promote a combination of micro-enterprise business development and residential living in the downtown:
1) The City's REAP (Rome Entrepreneur Assistance) Program provides up to $5,000 (CDBG funds) to entrepreneurs that agree to locate or expand a business in the City's Main Streets target area. Many of the target area buildings are older, former residences that are now small commercial storefronts with apartments above. 2) As part of a Main Streets Alliance and Weed and Seed partnership, the City designed its new NYS HOME Program to include funds (up to $25,000) for business owners to rehabilitate the residential units above the storefronts, if they agree to live in those spaces - promoting a 24/7 downtown. 3) A very successful Commercial Facade Demonstration Project also provides owners with up to $25,000 to improve their building's facade.
In partnership with a not-for-profit community development group, Rome Up & Running, the City is assisting with the development of the REACH (Rome Entertainment Arts, Cultural and Historic) Micro-enterprise Center to be located in a vacant building along its Main Streets Corridor. The Center will assist new and expanding businesses by providing "incubator-type" temporary space and business development services, with a focus on the arts. The goal is to then re-locate the businesses into target areas and buildings, not only Rome, but the region. We are in the process of working with developers in an effort to rehabilitate several vacant buildings to include artist loft spaces above galleries, retail and/or studio spaces. Our plans are to provide the developers with up to $25,000 in NY Main Street Program rehab grant funds as an incentive.
The Cohoes Common Council and Mayor John T. McDonald III passed into effect two local laws recently aimed at encouraging additional investment in historic and established buildings in the City of Cohoes.
Local Law 6 allowed for implementation of New York State Real Property Tax Law (RPTL) 444-a which is an exemption on improvements to properties that are designated as landmarks in the community. "This incentive works well with the vast amount of historic buildings we have in the community. Buildings that have remained vacant and abandoned now have yet another tool to spur on investment and more importantly, maintain these landmarks" said Cohoes Mayor John T. McDonald III.
Local Law 7 allowed for implementation of RPTL 485-a which is an incentive to property owners to invest and rehabilitate commercial office buildings into residential dwellings. "This incentive will be especially helpful in the downtown business district where we are working within the blueprints of the Downtown Redevelopment Study of 2003 which promoted a live/work environment in this area. Coupled with our past two Community Development Block Grants of $600,000 to assist in façade improvements and small business development, this incentive can play a role in bringing additional life to downtown" said Economic and Community Development Director Edward Tremblay.
Additionally there are a number of low-income programs available from NYS
DHCR in particular the HOME program. Listed at www.dhcr.state.ny.us
There are also a number of local programs that vary by community. Buffalo has and continues to acquire property through condemnation or purchase. The titles are cleared and the City then solicits RFPs for development to mixed use.
Look into the New Markets Tax Credit program. If your city qualifies as a Renewal Community, there may be incentives through that program. LISC is a good source of information on both such programs. And lastly, IDAs are permitted to finance certain types of residential projects and benefits such as property tax abatement, sales tax exemption and mortgage recording tax exemption could be available through them.
Both the Gov. Office of Small Cities Block grant program and the NY Main ST. grant program administered by DHCR have downtown housing development and rehab project funding sources. Feel free to check with me on details.
You can use HOME or CDBG money, though you have to income-restrict at least 51% of the units.
Tom Carey at DHCR - Albany Central Office is an excellent resource.
The City of Ogdensburg has utilized CDBG Small Cities grant funds to develop mod/low-income rental units on the upper floors of historic downtown buildings. The City also provided NYS and local façade grant money for exterior. The property is located in a NYS Empire Zone and receives property tax abatements. The owners also took advantage of housing tax credits.
The NYS Division of Housing’s Main Street Program targets funds for mixed use buildings. They also administer the Low Income Housing Tax Credit Program for development of affordable housing.
Look at dhcr.state.ny.us. The State Division of Housing has a NOFA now with substantial subsidies for housing development and they would probably like to do some main street projects. Time is already rather short for this year but you should look. These are for affordable units... serving households at 6o% to 90% of median.
Go to NY State Department of Housing & Community Renewal (DHCR) - they have lots of programs including their NY Main Street and they love housing in downtowns. Good web site to get anyone started.
The middle and lower Hudson Valley is experiencing a housing market dynamic and strength on the residential side that does not necessitate incentives for residential activity in any neighborhood including downtowns. Our genuine problem is gaining more "affordable housing".
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