BILL NUMBER: S10217
SPONSOR: HINCHEY
 
TITLE OF BILL:
An act to amend the private housing finance law, the tax law and the
real property tax law, in relation to enacting the accessory dwelling
unit incentive act
 
PURPOSE:
The purpose of this bill is to establish financial incentives to create
accessory dwelling units.
 
SUMMARY OF PROVISIONS:
Section 1. The act shall be known as the "accessory dwelling unit incen-
tive act".
Section 2. Amends the private housing finance law by adding a new arti-
cle 32 and includes
Section 1290. Legislative findings and purpose,
Section 1291. Definitions, Section 1292. Accessory dwelling unit forgiv-
able loan program.
Under the article, the Division of Homes and Community Renewal shall
promulgate rules and regulations necessary for the program.
Section 3. Amends section 606 of the tax law by adding new subsection
(nnn) to allow for the creation of a tax credit against the income tax
imposed under article 22 that is equal to fifty percent of the differ-
ence between market rate rent and the amount of rent charged under the
affordable rent guidelines, not to exceed $10,000.
Section 4. Amends the real property tax law by adding section 463 which
allows local governing bodies to adopt a resolution providing for an
exemption from taxation and special ad valorem levies on improvements to
residential real property that create affordable accessory dwelling
units.
Section 5. Provides that if any part of this act is judged to be invalid
and is not reversed, such judgement will not render the act invalid and
void.
Section 6. Effective date.
 
JUSTIFICATION:
Millions of New York renters and homeowners are struggling to afford
exorbitant housing costs statewide. This has caused individuals and
families to forego other necessities, face threats of eviction, and
confront the possibility of having to leave their communities for lower
cost locations. Statewide median rental costs rose by nearly 13% with
adjustments for inflation from 2007 to 2017 compared to a 2.5% increase
in median household incomes for renters in that same period, and housing
affordability challenges have only been exacerbated by the COVID-19
pandemic.
New York State is now at a crisis point in the availability of afforda-
ble housing. Notably, the creation of accessory dwelling units, attached
or detached units that allow for independent living on an existing resi-
dential property, is a proven way to increase the amount of housing in a
permitting community. However, one of the largest impediments to the
creation of accessory dwelling units, where allowable, is the upfront
capital costs of permitting, designing, and constructing and other
impediments to affordability. The purpose of this act is to create a
forgivable loan program, provide an income tax credit, and a real prop-
erty tax exemption to incentivize property owners to construct accessory
dwelling units where such units are permitted.
 
LEGISLATIVE HISTORY:
2023-24: A.1401
2021-22: A.9872
 
FISCAL IMPLICATIONS:
To be determined.
 
EFFECTIVE DATE:
This act shall take effect immediately.

Statutes affected:
S10217: 606 tax law