First State in the Nation to Secure International Certification for Development of Housing That Reduces Impact of Climate Change Bonds Expected to Create Over 640 Green, Affordable and Supportive Apartments Across New York State Fortifies New York’s Reputation as National Leader in Addressing Climate Issues and Reducing Carbon Emissions
Governor Andrew M. Cuomo today announced that New York State has secured international certification of nearly $100 million in new "Green Bonds" to drive the development of housing that has a positive impact on the environment and climate. New York is now the first state in the nation to have its affordable housing bonds certified by The Climate Bond Standards Board, on behalf of the Climate Bonds Initiative, an international not-for-profit organization supporting financing for projects around the world that help reduce the impact of climate change.
"Green Bonds are an innovative tool to build cleaner, greener, affordable housing and place New York at the forefront of sustainable development," Governor Cuomo said. "New York leads the nation in pioneering solutions to 21st century challenges, and these Green Bonds will provide hundreds of new housing units to New Yorkers in need, while reducing carbon emissions, mitigating the impact of climate change and creating a more sustainable future for all New Yorkers."
Lieutenant Governor Kathy Hochul, who made the announcement at Governor Cuomo’s Sustainable Development Conference, said, "This is yet another example on how New York, under the strong leadership of Governor Cuomo, is pushing forward to uncover resources to fund housing developments that are not only affordable but energy-efficient. New York continues to lead in this important effort to reduce the impacts of climate change to provide a better future for all New Yorkers."
New York State Homes and Community Renewal’s Housing Finance Agency will issue the bonds under its new Green Bond program, funding four developments that will inject nearly $200 million in economic activity into local economies and create more than 640 green, affordable and supportive apartments for Kings, Westchester, Monroe, and Orange County residents.
The international certification builds on New York’s reputation as a national leader in setting strict environmental standards and reducing carbon emissions. Earlier this year, New York issued its first Green Bonds for transportation when the Climate Bonds Initiative certified $500 million in bond proceeds for the MTA to continue infrastructure renewal and upgrade projects, encourage public transportation, and reduce greenhouse gas emissions.
In 2016, the Governor announced the Clean Energy Standard, mandating that 50 percent of New York's electricity comes from renewable resources by 2030. The Clean Energy Standard will slash carbon emissions, protect the environment and grow the clean energy economy. In addition, beginning on January 1, 2017 all Homes and Community Renewal new construction multi-family projects will adhere to green standards.
New York State is the top issuer of housing bonds in the country, serving as a model for other states. Housing bonds will now be even more marketable to the Green Bond community. An estimated $45 trillion in assets is currently under management by investors that have made public commitments to climate and responsible investment.
James S. Rubin, Commissioner of New York State Homes and Community Renewal said, "Under Governor Cuomo's leadership, New York is leading the nation in innovative approaches to housing that is not only affordable, but healthy and sustainable. With this Green Bond certification, New York is again on the cutting edge of solutions that will drive affordable housing development and create a more resilient future for New York families.
John B. Rhodes, President and CEO, New York State Energy Research and Development Authority, said, "This is a great step by New York State to work even more effectively with building owners in constructing more energy-efficient and comfortable buildings for New York residents. Governor Cuomo has made it a priority to ensure all New Yorkers, including low-to moderate income, have the opportunity to benefit from energy-efficient housing."
Senator Betty Little, Chair of the Senate Housing Committee, said, “Investing in affordable housing is not only something that benefits families, but done right, should benefit the environment, too. I am really pleased to see New York State is leading the nation in this effort with the ‘green bonds’ and congratulate our housing commissioner, Jamie Rubin, and Governor Cuomo for making this a priority. I am certain we will see some exciting innovation and progress as a result of this new standard and a lasting impact that makes support of affordable housing even more worthwhile.”
Assemblyman Keith L.T. Wright, Chair of the Assembly Housing Committee, said, "This is an innovative way that addresses our affordable housing crisis while safeguarding the environment. I commend Governor Cuomo and his housing team for this progressive initiative."
Assembly Energy Chair Amy Paulin said, “Green Bonds demonstrate our commitment to affordable and supportive housing while recognizing our responsibility to respect the environment. I applaud Governor Cuomo’s vision for sustainable development and HCR’s implementation of green standards on new construction starting January 1.”
Sean Kidney, CEO of The Climate Bonds Initiative, said, "Reducing emissions and improving the energy efficiency and environmental performance of residential buildings is a key part of the shift to a modern, low carbon economy. The climate leadership displayed by New York State with this new green bond is a signal of the innovation the US market is capable of. This certified property bond is a first amongst housing finance agencies. New York is providing a best practice model for green investment that others can follow. "
Judi Kende, Vice President and New York Market Leader, Enterprise, said, "Enterprise applauds Governor Cuomo and HCR for developing a smart and equitable Green Bond Program that will extend the benefits of sustainable housing to hundreds of low-income households throughout the state. Green affordable housing provides climate resiliency, healthy living conditions, and cost savings for low- and moderate-income households and green bonds are an innovative way to make that possible. We are honored that the Enterprise Green Communities Criteria, the national standard for green affordable housing, will be used for the first green bond certified by an external party in New York State."
Jolie Milstein, president and CEO of the New York State Association for Affordable Housing, said, “We applaud Governor Cuomo for combining his leadership on affordable housing with an equally powerful commitment to environmental sustainability. New York’s innovative approach will prove that we can support low- and middle-income families while also making them partners in a statewide effort to combat climate change. NYSAFAH members look forward to utilizing this incredible new resource as we continue to address the housing crisis and drive economic growth in every community across New York.”
As part of this initiative, Homes and Community Renewal is partnering with Enterprise Community Partners, a national leader in the development of affordable housing in New York and throughout the United States. Enterprise has developed criteria to certify 'Green Communities,' including design, location/neighborhood, environmental and other site improvements, water conservation, energy efficiency, materials, healthy living, building operations and resident engagement. Homes and Community Renewal is working with Enterprise to qualify their Green Communities standard as a proxy to achieve Climate Bonds Initiative certification.
To be certified as a Climate Bond, a bond offering needs to meet rigorous criteria relating to reporting and transparency and the green characteristics of the underlying assets. Eligible projects funded with the bonds need to be clearly identified; internal processes and controls to ensure tracking of proceeds have to be set up; and reporting regarding assets involved is required. The bond needs to be verified by an independent external verifier approved by the Climate Bonds Initiative Board. Lastly, the issuer of a green bond has to commit to ongoing annual reporting of the assets funded with the green bond proceeds. This is to satisfy investors that the projects remain in service as initially described. The Climate Bonds Initiative is an investor-focused not-for-profit, promoting large-scale investment in the low-carbon economy.