NY to energize Central New York housing development with a $150M loan fund

Syracuse, N.Y. – State officials today approved a $150 million loan fund to invigorate housing development in Central New York that is sorely needed as Micron Technology begins building its first chip fab in Clay.

The board of directors of Empire State Development, the state economic development agency, approved the Housing Central New York Fund today at their meeting. The fund will be ready to make low-interest loans to developers in time for construction to begin this spring, said Kevin Younis, chief operating officer of ESD.

The goal is to create at least 2,500 new housing units over five years – apartments and owner-occupied homes — within commuting distance of Micron in the six-county Central New York region. The fund will make construction loans at about 6% interest, less than half of what many banks currently charge, Younis said.

Local housing development has lagged in recent years, despite a shortage that drives up rents and home prices. Gov. Kathy Hochul said it’s urgent to add to the supply of housing with Micron gearing up to create thousands of new jobs.

“The only way to solve the housing crisis is to build more housing,” Hochul said in a prepared statement. “As Central New York prepares for unprecedented growth, the Housing Central New York Fund will help to ensure families, workers, and communities can afford to live and grow where the opportunities are and build their future in New York State.”

A housing study commissioned by ESD estimated last year that the pace of homebuilding in Central New York would have to triple to meet the demand stemming from Micron. The region will need up to 32,000 new housing units by 2038, the study said.

So far, the housing industry has not responded. Onondaga County, for example, added an average of just 785 housing units a year from 2020 through 2024, the most recent data available from county property records.

But now that Micron has started site work on the first chip fab, the loan fund should help spur construction, Younis said.

“Folks were waiting to see Micron break ground. Now that that has happened, I think you’re going to see a lot more movement. Combined with this (loan) product in the market, things are going to start moving,” he said.

The loan fund will target mid-priced workforce housing, said Brad Willows, an ESD staff person who spoke to the board members. Higher-end development won’t need subsidies, and low-income housing will rely on state grants and tax credits.

The new loan fund will finance both rental properties and owner-occupied homes. Priority will be given to projects with clustered housing that reflect “smart growth” rather than sprawl, creating walkable communities where there is already infrastructure such as water and sewer service.

For both apartments and for-sale residences, state officials want to see “dense” development — at least 10 units per acre.

Most of the financed housing will be market-priced. But there are modest requirements to include so-called workforce housing for people with moderate incomes.

At least 10% of the rental units in a project must be affordable to tenants earning 80% of the area median income. That’s about $58,000 a year for a single person.

For owner-occupied housing, at least 10% of the homes must be affordable to people making 110% of AMI, or about $91,000 for a two-person household.

Perhaps most significantly, to receive financing a project must be located in a state-certified “Pro-Housing Community,” a designation created by Hochul that qualifies municipalities for certain funding. To get certified, a municipality must submit a letter of intent and zoning information, and it must either document recent housing growth or pass a pro-housing resolution.

According to the online database maintained by the state Division of Homes and Community Renewal, there are 13 certified municipalities in Onondaga County.

Notably, the town of Clay, which includes the Micron site, is not among them, although the neighboring towns of Cicero and Lysander are. All told, the six-county Central New York region has 50 certified pro-housing communities.

Younis said the loan fund is likely to encourage more municipalities to get certified.

“We want more tools out there that are pushing people to make sure they’re in a pro-housing community. And if Clay’s not, we want them to be. We hope that this tool will be another reason that they will push to be,” he said.

Clay town Supervisor Damian Ulatowski did not immediately respond to a request for comment.

The new loan fund will be managed by the Community Preservation Corp., or CPC, a nonprofit housing organization with a long history of financing projects in Central New York and other parts of the state. CPC was chosen after a request for proposals issued by CenterState CEO, the nonprofit development agency, working in collaboration with ESD.

CenterState has been working with state officials to get multi-family housing developments “unstuck,’’ said Ben Sio, chief of staff. Making financing easier should help, he said.

Empire State Development will seed the loan fund with $30 million of state money. CPC will provide $15 million in equity. Micron also will contribute to the fund in an amount that had not been finalized as of Wednesday, Younis said. The rest of the money will be raised from regional banks and philanthropies.

Half of the state money will come from the Upstate Revitalization Initiative, a $500 million development program launched by former Gov. Andrew Cuomo in 2015 that still has unspent funds. The remaining $15 million will come from the New York Works economic development fund.

Staff writer Tim Knauss can be reached by email or at 315-470-3023.