At the end of the “Yes to ADU!” panel and information session inside the barn at the Kingston Maritime Museum on July 13, Reggie Walcott, a 34-year-old architecture and design professional, still had not been converted.
“It’s so far beyond the realm of reality,” said Walcott, “to believe that a $125,000 grant would actually cover what’s required to completely refurb even an already existing structure on a slab.”
Walcott’s opinion notwithstanding, $125,000 is the amount of funding ready and available to a dozen or so residents of Ulster County who can successfully apply to the Plus One Home program to develop code-compliant ADUs (accessory dwelling units).
“We won a $1.75-million state grant,” explained Ulster County senior planner Kai Lord-Farmer. “We’re hoping to build 12 to 14 units, and then there’s potential for future funding.”
In partnership with the City of Kingston and Rupco, Ulster County has been trying to spread the word about available funding to propertyowners throughout the county who may not otherwise be able to afford to build an ADU. Lord-Farmer says the location for the event was chosen for its central location in the county.
About 70 people turned up to the event. Ceiling fans stirred the air high up above them in the barn. The luminaries on the stage included Bartek Starodaj, director of housing initiatives for the City of Kingston, and Rupco strategy vice-president Faith Moore.
Covering the gap costs
Faced with a variety of related questions from the crowd, Lord-Farmer did acknowledge that the amount offered may not cover the cost of the entire build.
“It depends,” said Lord-Farmer. “If you are doing an attached unit or renovating your basement, it gets way cheaper. We know that 125 is not necessarily going to cover the entire cost, but it’s gonna get you a large majority. And then Rupco and the county are going to help you hopefully find financing to cover the gap costs.”
The money is targeted to propertyowners who earn an income at less than the county area median income (AMI). To be funded, a ten-year commitment is required for funding. The funded ADUs will be rented out as long-term rentals. They cannot be operated as short-term rentals.
Lord-Farmer said that Ulster County rents have increased about 40 percent over the past ten years. Twelve percent of homeowners and 30 percent of renters in Ulster County spend more than half their monthly income on housing costs, a condition referred to as severely cost-burdened. County median home sale prices have increased 43 percent in the past four years, and are now stagnant at that high level
ADUs are one arrow in the municipal quiver to address the mismatch between the type of housing that Lord-Farmer said the county needs and what it has been getting. From 2015 to 2020 the average new-home size was 2245 square feet with a median sale price of $425,000.
In an attempt to challenge the building community to reduce the costs anticipated for building an ADU, a design competition with prize money for the winners has been announced. “Right now we’re inviting architects to submit plans for ADUs that could be built in the City of Kingston or Ulster County,” said Starodaj, “and we will select a winner from those submissions, and the winning submission will be pre-approved by our building department.”
There are two different prizes, one a professional prize for those with an architectural license, and the other for students and non-professionals. The designed ADUs can be anywhere between a 250-square-foot minimum to a thousand-square-foot maximum in size.
“We’re requiring that no fossil-fuel-based appliances are used in the modeling,” said Starodaj, “so all-electric appliances. And the design must include a kitchen, bathroom, sleeping area and then separate ingress, egress entrances for the unit. And then we are strongly encouraging the proposals to keep all construction costs under $125,000.”
The designed ADUs do not need to follow anyone else’s blueprint. To increase the likelihood of an application being selected for funding, though, it is suggested that the proposed rent to a future tenant be reduced.
“If you’re getting $125,000 for free,” explained Lord-Farmer, “you could rent it out for $500 [a month] and change someone’s life. This is hopefully going to cover, if not the entire costs, then a large majority of them, and so we’re asking you to provide more affordable housing in Ulster County.”
Use your imagination
Walcott snickered at that.
“It would basically be like, ‘Hey, you’re providing affordable housing to residents in Ulster County!’ Which is a very noble cause, but for someone who’s maybe not in a bracket where those numbers make sense, it’s not feasible. For a bunch of rich people that moved here post-pandemic? I could see this making sense.”
Walcott was similarly dismissive in his appraisal of Lord-Farmer’s suggestion that anyone should look to financing from Freddie Mac based on future real-estate incomes. “You can work with Freddie Mac,” Lord-Farmer had suggested from the stage, “and you can say this is what I want to build, and they’ll estimate what your potential rent range would be and then you can finance based on future rental incomes, which is very rare for lenders.”
“Freddie Mac,” responded Walcott. “Give me a break. Anyone who’s doing financing for loans, now you’re just in a new predatory pool of borrowing.”
Anyone selected to receive the grant will be paired with a Rupco contract specialist who will help with the design, the permitting, and the contractor management.
“So most of the pieces will be out of your hands,” said Lord-Farmer. “We’re trying to make it as easy as possible for you to build that unit.”
ADUs need not be unattached. Garages, basements, or new attachments to existing structures would qualify. If the ADUs were used for housing relatives or family members, there could be alternatives to charging rent. Applications providing for the elderly or those with disabilities are favored.
The window for submitting applications opens on Thursday, July 20 and over the six weeks or so that applications are accepted, Lord-Farmer will be spreading the good word. “We’re going to be doing outreach in the rest of the county,” he promised. He’s going to do a road show. The next event will be in Shandaken. “We’re going to distribute the grants evenly around the county,” he said.
September 8 will be the cutoff date for applications.