Statehouse Report: Maine lawmakers push housing solutions

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For years, party platforms and legislative agendas have promised more affordable housing for Maine – even as homelessness increases and housing stock deteriorates.

Now, the Legislature may finally be doing something substantial about it, with three bills in the pipeline taking on various aspects of the problem.

The one garnering the most attention, LD 2003, is from House Speaker Ryan Fecteau, D-Biddeford, the product of a commission he co-chaired with Sen. Craig Hickman, D-Winthrop.

It uses a mixture of carrots and sticks to remove regulatory barriers to building more housing units and to encourage towns and cities to do a better job planning for retirement and workforce housing, especially for first-time buyers now shut out of the market.

In an interview following a tour of southern and coastal Maine last week, Fecteau said it’s clear the state has been ignoring the affordability gap for too long. The state needs at least 1,000 more units a year, he said, but instead has been averaging only 250.

“Last year we did a bit better,” Fecteau said, “about 500,” aided by a one-time infusion of $50 million to Maine Housing from the federal American Rescue Plan passed by Congressional Democrats, and $80 million for affordable housing tax credits contained in a bill sponsored by Fecteau.

Under an accelerated timeline, with April adjournment looming, the bill had its public hearing March 7 before the Labor and Housing Committee.

Some aspects are relatively uncontroversial, such as a requirement that “accessory dwelling units,” also known as in-law apartments, be allowed in all zones that allow residential construction.

Ryan Fecteau
Maine Speaker of the House Ryan Fecteau, D-Biddeford.

Even here, though, there are discrepancies, Fecteau said.

In one section of Wells, he heard from a family that recently constructed an attached apartment for an elderly relative at half the price of the alternative, a condo or assisted living arrangement. It was allowed, however, only because no stove or refrigerator was added. Nearby, in another residential zone, kitchens are allowed.

“That’s the kind of rules we have to get beyond,” Fecteau said; LD 2003l would permit full units statewide.

Fecteau is getting pushback from municipal lobbyists on two provisions: a ban on residential growth caps, such as one in place for two decades in Scarborough, and the establishment of a state housing review board that would have the authority to override municipal denials of affordable housing projects.

“There’s room for discussion,” Fecteau said. The cap might be confined only to affordable units, and rulings from the review board could be advisory rather than mandatory.

Still, he pointed out that New Hampshire has implemented a similar review board with mandatory powers, signed into law by Republican Gov. Chris Sununu.

There is an advantage from the municipal side, Fecteau said. “If you appeal to the board, and lose, you can’t also file in court. That’s a real saving for towns.”

Many multiunit projects end up in court anyway, he said, so state review could expedite resolution, rather than tying up developable property for years.

The housing bill would also allocate $4.5 million to beef up capabilities of municipal and regional planning, and reward communities willing to overhaul their ordinances.

Beefing up subsidies

Other lawmakers are tackling affordability by attempting to increase state housing subsidies.

Ben Chipman
Sen. Ben Chipman, D-Portland.

After a bill to increase the real estate transfer tax was vetoed by Gov. Janet Mills last year, Sen. Ben Chipman, D-Portland, co-chair of the Taxation Committee, decided to take a new approach in LD 484 by shifting more funding to Maine Housing’s HOME fund, the primary state vehicle for helping first-time buyers.

Currently, 10 percent of revenue goes to counties for administration, while the HOME fund splits the rest with the General Fund. Chipman’s bill would direct the entire amount, about $46 million, to housing subsidies.

“It’s not a tax increase, so it can’t have that objection,” he said.

Rep. Lynne Williams, D-Bar Harbor, sponsor of LD 418 – the bill Mills vetoed – said she hopes a new Legislature will revisit the issue, and that there’s room for an increase for higher-priced homes.

“Maine’s rate is half what New Hampshire and Vermont charge,” she said. “It not going to have an effect on sales.”

Nor was she impressed by Mills’ rationale for the veto, that the HOME fund had a positive year-end balance. “The whole point is that we have to do more,” Williams said.

At its hearing, Chipman’s bill was supported by Maine Housing’s government relations director, former Portland Rep. Erik Jorgensen, who called it “an idea that could really move the needle on housing,” by creating a larger permanent funding source.

Jorgensen acknowledged it “would come at considerable cost to the general fund,” but said the problem is too large to ignore: “Housing is, in many ways, the issue of our times.”

The Taxation Committee amended and unanimously approved LD 484; it awaits consideration in the supplemental budget.

The third bill, LD 473, from Rep. Victoria Morales, D-South Portland, would establish a new state rental assistance program to piggyback the Section 8 voucher program of the federal Department of Housing and Urban Development.

Fecteau pointed out that, in Maine, there’s a waiting list of 27,000 families for Section 8 vouchers, and it can take years to qualify. “Anything we can do at the state level is going to help,” he said.

The bill, which would allocate $9 million for assistance with $7.5 million annually directed to rent subsidies, has proceeded the farthest of any affordable housing proposal this session.

Before adjournment last June, the House and Senate passed different versions, and, failing to agree, carried it over. It faces further votes before adjournment in April.

In terms of funding, it may be a good time for housing proposals. The Revenue Forecasting Committee just added another $411 million to the previously projected surplus of $822 million.

While Mills wants to send half the entire amount back to taxpayers, that still leaves a hefty sum to be allocated.

No one is suggesting that state government, alone, can bridge the housing gap. But there’s little question that, collectively, these bills would make a difference.

Douglas Rooks, a Maine editor, commentator, and reporter since 1984, is the author of three books. His first, “Statesman: George Mitchell and the Art of the Possible,” is now in paperback. He welcomes comments at [email protected].