New York State’s New Budget Offers Housing Stability

This year’s state budget process kept many New Yorkers on edge, as critical issues like housing affordability hung in the balance. After weeks of negotiation and anticipation, the outcome proved worth the wait for budget watchers. Fortunately for advocates of affordable housing, the deal Gov. Kathy Hochul announced with legislative leaders delivered meaningful progress.

At a time when economic uncertainty looms large and the affordability crisis continues to squeeze working families across the Empire State, the governor and lawmakers took decisive action to provide much-needed relief.

Among the most significant wins: the doubling of the State Low-Income Housing Tax Credit (SLIHC), now set at $30 million annually for the next four years. This boost alone will spur the development and preservation of thousands of affordable homes across the state, in both urban centers and small towns. In the remaining weeks of the legislative session, my organization, the New York State Association for Affordable Housing, will continue to advocate for changes in the SLIHC program to maximize opportunities for greater private investment.

The budget also strengthens support for New York’s most vulnerable residents with an additional $30 million annually for the Empire State Supportive Housing Initiative (ESSHI). These dollars fund permanent, deeply affordable housing with wraparound services to stabilize lives and prevent homelessness for people with complex needs. Initiatives like this build not just physical shelters, but also long-term homes and opportunities for New Yorkers.

Hochul and the legislature also delivered by fully funding the state’s Five-Year Housing Plan and  New York City’s City of Yes for Housing Opportunity. The Five-Year Housing Plan hit its halfway mark this year, having created or preserved over 55,000 affordable housing units of its expected 100,000-unit goal. 

Meanwhile, the state invested $1.025 billion in the City of Yes for Housing Opportunity for infrastructure updates and affordable housing, which is expected to boost the creation of 80,000 new homes in the five boroughs over the next 15 years. These groundbreaking programs have unlocked housing production, and will continue to do so, in the very places where demand is the highest and affordability is the lowest. 

Within the City of Yes for Housing Opportunity, $20 million is earmarked for capital projects and improvements to preserve affordable housing in New York City. NYSAFAH was the impetus for this Affordable Housing Relief Fund to preserve at-risk affordable units. We are encouraged by this initial funding commitment and are confident it will support the need for increased funding levels and expansion statewide. Preserving existing affordable housing units is just as important as building new units. Without dedicated resources for preservation, we risk losing more than we gain.

The state has also taken a forward-looking approach with a new Mixed-Income Revolving Loan Fund to encourage mixed-income rental housing by filling construction financing gaps. The budget includes $50 million for an upstate program, and an additional $50 million is earmarked from the City of Yes for Housing Opportunity for New York City. 

New funding also supports the creation of a four-year Housing Access Voucher Pilot Program, with $50 million dedicated to providing rental assistance for eligible individuals and families. This is a useful step toward increasing housing stability and expanding housing choice statewide.

And, in a much-needed move to modernize and expand access to affordable housing finance tools, the state reformed the State Historic Property Tax Credit eligibility rules for historic preservation and low-income housing to help break down the barriers and limitations that previously reduced its value.

It cannot be understated that the housing industry — from for-profit and not-for-profit developers to contractors, lenders and local governments — also depend on the reliability of federal investment. As we await the outcome of negotiations over the federal budget, it remains to be seen whether state lawmakers will need to reconvene later this year to address any statewide impact. It’s a good reminder that furthering affordable housing production and preservation requires innovation and leadership at every level: local, state and federal.

We don’t expect New York’s housing crisis to be solved in a single fiscal year. However, this budget is a critical step forward and proof of New York’s renewed commitment to housing security for families across the state. Affordable housing is not optional — it is an essential infrastructure. The state cannot build or preserve its way out of this crisis without sustained, dependable support from all levels of government.

Jolie Milstein is president and CEO of the New York State Association for Affordable Housing.