The Kingston City School Board has approved a plan to grant tax exemptions for new accessory dwelling units and mixed-income multifamily housing projects. This decision, made during a meeting on September 24, 2024, represents a significant step forward for the city’s housing initiative.
The 421-P exemption, which received prior approval from the Common Council in August 2024, aims to encourage the construction of rental properties with multiple units. Before these exemptions can take effect, they must receive approval from the Ulster County Legislature, as confirmed by the office of Mayor Steve Noble.
Under the 421-P exemption, municipalities can exempt newly constructed or converted rental properties with at least ten units from taxation and ad valorem levies. These qualifying structures must be built on vacant or underutilized land, with a stipulation that at least 25% of the units are affordable for households earning between 60% and 80% of the Area Median Income. Additionally, none of the units can house families with incomes exceeding 100% of the AMI.
Properties qualifying for the exemption will benefit from a complete tax exemption during construction for up to three years. Following this period, there will be a 25-year schedule of decreasing exemptions for improvements made, starting with a 96% exemption in the first year and declining by 4% each subsequent year. According to Mayor Noble’s office, no property will end up paying less in property taxes than it did prior to receiving the exemption.
The plan also includes the 421-P*2 exemption, which offers a partial tax exemption for new accessory dwelling units. This exemption applies for a period of ten years, beginning with a 100% exemption in the first year, followed by a gradual decline over the next five years. The new unit must provide independent living facilities and cannot be used for short-term rentals, as defined by the city’s form-based code.
Construction for both programs must commence following the local law’s passage. Mayor Noble expressed his ambitious goal of approving 1,000 housing units in Kingston by 2029, stating, “This two-pronged legislation supports homeowners to create additional housing on their property as well as developers to build or redevelop larger housing projects.”
The impact of inadequate housing extends beyond mere statistics, affecting the community at large, particularly its youth. Paul Padalino, Superintendent of the Kingston City School District, emphasized this point, noting, “Lack of adequate, proper housing has an impact on our entire community, especially our young people. These measures help ensure more families get access to a stable home, offering students a foundation for mental and emotional security, which is essential for academic success.”
For further details on the 421-P exemption for multifamily projects, visit the relevant resources. Additional information on the 421-P*2 exemption for accessory dwelling units can also be found through official legislative channels.