NYC DOB Offers Guidance on Affordable Housing as to Essential vs Non-Essential Project

On March 30, 2020, the New York City Department of Buildings (DOB) offered guidance on what “Essential” construction means for a project with an affordable housing component under the updated Empire State Development guidelines issued on Friday, March 27, 2020 under Governor Cuomo’s Executive Order 202.6. The DOB offered clarity on whether a project qualifies under the affordable housing exception to the state-wide stop work order. The text of the guidance reads:

Affordable housing: Construction work on public housing, or a private or multiple dwelling or real property that is a new building (NB) or that is 100% vacant; or is work on unoccupied public housing units for the designation as housing for specific populations (i.e. shelter set aside, domestic violence referrals), or work on the exterior to address emergency conditions requiring immediate corrective action, set forth in Section 1(a)(iii) or within public housing, correction of critical systems for seasonal preparedness for the 2020-2021 heating season of an existing public housing building. Construction work on a private or multiple dwelling or real property that is a new building (NB) or that is 100% vacant that is now used or will be converted to such use: (i) For the provision of affordable inclusionary housing or mandatory inclusionary housing pursuant to the New York city zoning resolution; or (ii) Where no less than 30% of the residential units are subject to a regulatory agreement, restrictive declaration, or similar instrument with a local, state, or federal governmental entity or a local housing authority in a city with a population of one million or more.

First, the project must either be a new build, 100% vacant, on unoccupied units in an otherwise occupied public housing building which are to be set aside for specific groups, exterior work on an occupied public housing building, or correction of critical system for seasonal preparedness on public housing. Second, if the project is not public housing but is a new build or complete renovation with complete vacancy, the project must be either (1) inclusionary housing pursuant to a program offered or required under the New York City Zoning Regulation, or (2) include at least a 30% affordable set-aside.

Inclusionary developments, projects which typically permit developers greater overall density and other benefits in exchange for some portion of the project being set aside for lower income residents, are not necessarily obvious to outside observers or contractors on the project. While New York City provides a resource for determining which sites are in the Inclusionary Housing Program here, the resource may not cover all qualifying projects throughout the City. Accordingly, project owners should provide evidence to their construction team that the project qualifies and that work should continue.

Determining whether a project qualifies under the affordable housing exemption will be a project-specific determination, so it is important to maintain clear open lines of communication in order to avoid unnecessarily delaying a project where permitted to work or incurring a $10,000 fine where not.

As the law continues to evolve on these matters, please note that this article is current as of date and time of publication and may not reflect subsequent developments. The content and interpretation of the issues addressed herein is subject to change. Cole Schotz P.C. disclaims any and all liability with respect to actions taken or not taken based on any or all of the contents of this publication to the fullest extent permitted by law. This is for general informational purposes and does not constitute legal advice or create an attorney-client relationship. Do not act or refrain from acting upon the information contained in this publication without obtaining legal, financial and tax advice. For further information, please do not hesitate to reach out to your firm contact or to any of the attorneys listed in this publication.

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