Community Capital New York is a Community Development Financial Institution (CDFI) that serves seven counties in the Lower Hudson Valley, encompassing a wide variety of cities, towns and villages, but none of them are as compelling as the City of Newburgh.

Today, Newburgh is a mix of opportunity and despair. Due to a variety of factors, the City has suffered from decades-long disinvestment, leaving it with approximately 700 vacant properties, over a quarter of which are tax foreclosed and most of which are located in the East End Historic District (see maps).

The Historic Districts in the City of Newburgh have the most contributing properties of any Historic District in the State of New York, and this rich architectural history should be an economic driver to the local economy.  However, these same census tracts – 4 and 5 – are counted as two of the five poorest in the State, with 25.8% of the population living below the poverty line.

There is a proliferation of run down, vacant and collapsing buildings throughout these historic neighborhoods.  The buildings are also old; over 70% of the housing units were built prior to 1950[1].   The age of the buildings is driving the unusually high cost for lead and asbestos abatement attendant to the redevelopment of almost every unit.  Even those buildings that are falling down and hazardous are slow to be removed because the City will have to bear the expense of appropriate disposal of the lead and asbestos. And while developers can purchase homes off in rem rolls for a fraction of their potential value, few are willing to take on the risk.

This combination of old housing stock and abject poverty has left the City unable to successfully redevelop the neighborhoods around its downtown core.  In a study commissioned by the Newburgh Community Land Bank, for profit and not for profit developers alike cited the issue of lead and asbestos remediation as the biggest barrier to redevelopment.  These conditions have created a stalemate for the City, leaving the very heart of the community in a state of disrepair and continual disinvestment.


The Newburgh Affordable Housing Remediation Fund is focused on increasing the supply of safe, decent affordable housing for families in targeted locations in the City of Newburgh as part of broader community redevelopment effort.  The proposal has two components:

  1. Assuming the risk related to the cost of property evaluations, thereby increasing the number of properties under consideration for redevelopment through the establishment of a feasibility fund; and
  2. Subsidizing the cost of remediation in selected cases to increase the impact of redevelopment efforts through the establishment of a grant program to close the financial viability gap.

#1. Feasibility Fund.  Based on a model that has worked successfully to create affordable housing in Westchester County, the Newburgh Affordable Housing Remediation Fund would provide forgivable loans to for profit and not for profit developers as an incentive to complete necessary lead and asbestos inspections on properties they are considering buying in the target area. If the findings are such that the project can be successfully developed as affordable units, the loan will be repaid at the close of construction financing, making the funds part of a revolving loan fund that can be recycled until exhausted.

In some cases, the findings from the lead and asbestos inspections may be significant enough to make the possibility of rehabilitating the building infeasible; the developer will unlikely be able to fully recapture the high cost of remediation through rents or sales prices due to the depressed housing market in Newburgh.

This is a risk developers cannot afford to take on their own, making it difficult for the City and other stakeholders to implement a targeted strategy for neighborhood revitalization.  By forgiving the loan in those cases where the economics do not work, we will be able to overcome a stalemate that is hindering redevelopment efforts at present.

In addition, feasibility funds available through this fund would enable developers to investigate the potential of full block redevelopment, benefitting from cost savings by financing in scale, expediting project completion and enhancing neighborhood impact.

#2. Remediation Grants.  The ideal complement to the feasibility loans would be the establishment of a pool of funds from which Community Capital could make grants to subsidize the cost of lead and asbestos remediation.  These grants could be selectively provided to close the “gap” on parcels determined to be critical to creating impact for the community.  Estimates from developers in the community are that lead and asbestos remediation costs average $60,000 per property, about $30,000 more than the point at which the budgets work for affordable housing options.

Providing grants to close this gap would enable the financial viability of buildings key to neighborhood revitalization while providing a range of affordable housing options to residents.  In addition, these grants would help the community move beyond one-off rehabs in those instances where the economics work, to an effective strategic, targeted redevelopment approach that leads to real neighborhood change.

Proposed Program Parameters

  • Loans and grants will be available to private and not for profit developers.
  • Each formerly dilapidated or abandoned building receiving lead and asbestos testing and/or remediation will be used to create affordable housing options for households with an income at or below 60% of the area median income ($52,300 for a family of four).
  • Affordability will be ensured by working with not for profits who include long term affordability deed restrictions on all their properties as a part of their mission and by working with private developers who are using funding subsidies from sources such as NY State which requires deed restrictions mandating long term affordability as a requirement of receiving their funds.
  • Eligible properties must be located in an area bounded by South Street, Grand Street, William Street and Robinson Avenue and be part of a broader rehabilitation prioritized by the City’s Vacant Property Revitalization Plan (the Pace study). By establishing a beach head, and continuing to build on its success, we can slowly eradicate high crime, create community stakeholders, and foster investment in the target area.
  • Feasibility loans will be capped at $5,000 per building. Loans will be repaid at the close of construction financing.
  • Remediation grants will be made to those properties seen as critical to implementation of an established community development strategy. The maximum grant amount will be at the discretion of Community Capital in consultation with key community leaders.


  • $25,000 to capitalize a Feasibility Fund for lead and asbestos testing, with Regional Banks each contributing a portion.
  • Capitalizing a Remediation Fund for Lead and Asbestos remediation.



[1] 2010-2013 Orange County Community Health Assessment