New York towns that lost money in county's zoning dispute with US can again apply for grants

Towns and villages that lost millions of dollars because of a zoning law battle between Westchester County and the federal government will once again be eligible for federal community development funds under a plan announced Monday by Gov. Andrew Cuomo.

The overall dispute continues, however, with County Executive Rob Astorino declaring, "The county did not capitulate to demands that we give up local zoning."

Under the new agreement, towns and villages in Westchester, and some nonprofit agencies, can compete for as much as $5 million in grants from the U.S. Department of Housing and Urban Development.

HUD had cut off funds when Astorino did not submit what HUD considered an acceptable analysis of zoning law obstacles to fair housing in Westchester. The analysis was required as part of the 2009 settlement of a housing discrimination lawsuit against the county. The county submitted several analyses, all of which concluded there were no obstacles. HUD rejected them all.

More than $12 million was withheld. The funds could have been used for such projects as housing rehabilitation, new sidewalks and business development.

Holly Leicht, HUD's regional administrator, said the Westchester municipalities that lost money would now be applying to the state, rather than the county, for HUD funds, and the state would have a larger amount to give.

She said the towns and villages had been "kind of held hostage because of the county's noncompliance. This is a way those towns can apply."

Astorino said Monday that he is happy with Monday's agreement, and said he had proposed a similar deal in 2013.

Leicht said the new funding arrangement has no effect on the legal dispute, which is pending in federal court.

"Westchester is still required to comply," she said. Astorino said the county is complying.