State Treasurer Bruce Poliquin spoke Tuesday at a press conference about exciting progress at the MaineHousing. See video here.
Thanks to new leadership at the Maine State Housing Authority, the cost of developing or rehabilitating affordable housing units in Maine has been reduced by 36 percent and 148 more units than last year will be available to low-income families.
Last year, 177 units were available. This year, 325 will be available—and they will cost almost $74,000 per unit less to create.
The significantly reduced costs and increased units result from a year-long effort by MaineHousing’s Board of Commissioners and staff, in partnership with Maine’s development community, to place incentives on lowering costs.
Six affordable housing projects will receive a share of $2.9 million in federal Low Income Housing Tax Credits (LIHTC), which help leverage approximately $25 million in private investment into Maine.
The projects are in Lewiston, South Portland, Portland, Saco and Biddeford. Combined, the development projects total nearly $43 million.
The average total development cost of the six projects is $132,256 per unit, which is a decrease of $73,895 per unit. Last year’s average was $206,151 per unit for a total of just 177 units.
For more than a year, MaineHousing’s Board of Commissioners, staff and representatives from the development community evaluated and re-wrote what’s called the Qualified Allocation Plan, a federally required competitive scoring system in which development projects receive points for meeting cost and construction criteria. The highest-scoring projects each receive a portion of the Low Income Housing Tax Credits.
A key element of the new QAP is the awarding of points to developers who bring down costs and assist in the construction or rehabilitation of more housing units for Maine’s lower-income households.
“Developers chase points because they want the Low Income Housing Tax Credits,” said Peter Anastos, Chairman of MaineHousing’s Board of Directors. “It made sense that this year we give the incentive of additional points to developers who reduced the total development cost per unit. And it worked.”
Interest in the LIHTC program was high. MaineHousing received 19 applications to build or rehabilitate 870 units with a total request of $9.8 million in low-income housing tax credits. That exceeded the available amount of credits by $7.2 million.
Last month, it was announced that 18 of the 19 projects vying for the LIHTC’s had reduced total development costs by approximately 25 percent. (One project was dismissed due to an incomplete application.)
Now that they’ve been scored, the six winning projects will result in a 36 percent reduction over last year’s costs, plus 148 more units will be built or rehabilitated as compared to last year—325 compared to 177.
MaineHousing Director John Gallagher said that MaineHousing’s Board of Commissioners and staff are committed to refining and reducing the cost of taxpayer-funded affordable housing as part of their mission to help more Maine families find homes—especially as federal funds from Washington, D.C. are expected to shrink over time.
This year’s selected projects will rehabilitate 184 affordable housing units, and create 130 new affordable housing and 11 market-rate rental units. The projects are:
Oak Park Apartments: An existing 91-unit Section 8 affordable housing project for seniors in Lewiston will be rehabilitated to improve its energy performance plus capital improvements. Total Development Cost is $101,999 per unit. Property owner is Barkin Companies.
Osprey Circle: A 48-unit new construction project for seniors in South Portland. The proposal is to construct two three-story buildings that will include 24 units each with rents at or below 60 percent of the area’s median income. Total Development Cost is $148,748 per unit. Developer is Developers Collaborative.
Cumberland Ave Apartments: A 57-unit new construction project for families in Portland. Forty-six units will be for lower income families and 11 units will be market rate rentals. Total Development Cost is $178,553 per unit. Developer is Avesta Housing.
Riverview Apartments:An existing 61-unit apartment complex for families in Saco will be rehabilitated to replace windows, siding, paving, landscaping and other maintenance repairs. Units are rent restricted or market rate, and complex also has 6,000 square feet of commercial office space. Total Development Cost is $98,507 per unit. Developer is Bateman Partners.
Golden Village/Park Village/Maple Grove: Three existing Section 8 projects consisting of 32 total affordable housing units for seniors in Saco and Biddeford. Total Development Cost is $101,588/unit. Developer is Avesta Housing.
Boiler House Lofts: A 36-unit adaptive re-use of an historic mill project for families in Saco. The complex is located within the Saco Island Historic District. All renovations will be done in accordance with the requirements of Maine Historic Preservation Coalition and the National Park Service to ensure the property will qualify for state and federal historic tax credits. Total Development Cost is $197,889 per unit. Developer is Bateman Partners.
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