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Legislative panel considers bills to streamline housing projects, eliminate income requirements in residential construction

The Maine Legislature’s Committee on Labor and Housing held a public hearing on February 14 concerning LD 1673, a bill that would create a comprehensive permit process for affordable housing construction. The bill would create a state-level Affordable Housing Appeals Committee, which would hear appeals for permits that were denied at the local level. 

The bill would create a comprehensive permit process for low-income and moderate-income housing projects by allowing public agencies, nonprofits, and limited dividend organizations to submit a “single comprehensive permit application to build that housing in lieu of separate applications to the applicable local boards” to a local board of appeals.

The bill would allow local boards of appeal to have the same power to issue permits and approvals as other local boards, such as planning boards. 

Comprehensive Permitting Process

Having received a comprehensive permit, a board of appeals would notify the local boards of all jurisdictions affected by a proposed housing project and provide them with a copy of the application.

The board of appeals would also be required to hold a public hearing within 30 days of receiving a comprehensive permit application. It would have to take into consideration the recommendation of local boards and invite representatives of local boards to attend. It would be required to make a decision on the permit, based on a majority vote, within 40 days of the conclusion of the public hearing.

If the board does not hold a public hearing within 30 days, or hold a vote within 40 days, the bill stipulates that application is considered approved and a comprehensive permit must be issued. 

The board of appeals also has the authority to waive local laws or regulations if the waiver “results in a comprehensive permit application decision that is consistent with local needs.” 

Applicants unhappy with the decision reached on their project can appeal to the state-level Affordable Housing Appeals Committee, a five-member committee created by the law to hear appeals where a local board of appeals denies a comprehensive permit.

An applicant for a comprehensive permit wishing to contest a local board of appeals’ decision has 20 days within receiving notice of the decision to do so. The state-level committee then has 30 days to hold a hearing and make a decision based on a majority vote.

The committee also cannot modify or overturn a local board of appeals’ decision if the board “establishes that its decision is consistent with local needs.” The bill defines “consistent with local needs” in relation to regional needs for low-income and moderate-income housing.

When the committee hears appeals for denied applications, its hearing must be limited to the issue of whether a local board of appeals’ decision was “reasonable and consistent with local needs.” If the committee finds a boards’ decision to deny the permit was unreasonable, it can vacate the decision and direct the local board to issue a comprehensive permit, deteriorating local control for Maine municipalities. 

When the committee hears appeals for approved applications that have conditions and requirements attached, the hearing must be limited to whether the conditions and requirements make housing construction and operation uneconomic, as well as whether those requirements are consistent with local needs.

If the committee finds this is not the case, it can require a local board of appeals to modify or remove conditions to make the proposal “no longer uneconomic” and issue a comprehensive permit.

The committee cannot issue an order that would permit the building or operation of housing that is less safe than state and federal law require. The committee also cannot vacate, remove, or modify any decisions, or change any conditions or requirements, that are “consistent with local needs” as defined by the bill. 

Local boards of appeal must carry out the committee’s orders within 30 days of a decision. If they fail to do so, the committee’s order carries the weight of the board of appeals’ decision.

Local Affordable Housing Goals

The bill further prohibits the committee from considering the appeal of a comprehensive permit located in a municipality “in good standing” for low-income or moderate-income housing, as defined by the bill. 

The bill would require the Maine State Housing Authority to maintain a register of municipalities indicating whether each is “in good standing” for low-income and moderate-income housing.

The register would include municipalities the housing authority determines to be in compliance with its fair housing goal and municipalities the housing authority determines to have made “substantial progress” towards that goal and which it believes have a “substantial probability” of meeting the goal within three years. 

When making a determination about municipal compliance with fair housing goals, the bill requires the housing authority to disregard half of the housing units created after January 1, 2022 located in close proximity to major transportation infrastructure or industrial facilities or “that result in excessive clustering of low-income or moderate-income housing.”

The bill defines “affordable housing” as a dwelling or apartment “where the cost of housing and utilities is no more than 30% of gross household income for a household whose income does not exceed 120% of the median income of the area.”

The bill also creates affordable housing goals based on the number of households within a municipality and the percentage of these that are considered affordable. The committee sets the fair housing goal of municipalities with 500 or fewer households at 10% of housing stock being affordable housing.

For municipalities with between 501 and 1,000 households, fair housing goals are met when 13% of housing stock is considered affordable. For municipalities with more than 1,000 households, fair housing goals are met when at least 16% of stock is considered affordable. 

Additionally, a municipality is in compliance with its fair housing goal if 1.5% or more of its total land area zoned for commercial, residential, or industrial use has low-income or moderate-income housing.

The law also stipulates that applicants seeking comprehensive permits for housing projects must enter a “binding, verifiable obligation with the board of appeals that it agrees to accept no more than a reasonable profit on that project.”

Subverting Local Control?

During the February 14 hearing, Rep. Rachel Talbot Ross (D-Portland), the bill’s sponsor, presented the legislation and discussed the role she intends it to play in helping solve Maine’s housing crisis.

“Housing development involves multi-stage processes complicated by federal, state and local

permitting and funding requirements. Affordable housing development means jumping through lots of hoops. This all takes an inordinate amount of time, which in turn greatly delays when this critical affordable housing will house people. We are at a time when Maine simply can’t afford to wait. People are literally dying without housing, and that is unacceptable,” Talbot Ross said in her testimony. 

Talbot Ross added that the bill creates fair housing goals for the streamlined permit process “to ensure that housing development includes a specific affordability percentage tied to the percentage of households within municipalities in need of low-income or moderate-income housing.” 

She also said the bill had been drafted with the input of the Maine Immigrant Housing Coalition, Housing Justice Maine, the Greater Portland Community Land Trust, and other groups.

Members of the labor and housing committee questioned Ross about whether the bill would usurp local control over zoning and land use. Rep. Gary Drinkwater (R-Milford) questioned Talbot Ross about whether the bill would mean the state becomes part of the permitting process.

Talbot Ross said this was not the case and highlighted portions of the bill that require the appeals committee to seek recommendations from local authorities. However, the bill would allow the state-level appeals committee to overrule decisions made by local boards to require the construction of affordable housing units within a municipality. 

Sen. Stacey Guerin (R-Penobscot) asked Talbot Ross whether the appeals committee would be obligated to follow the recommendations of local communities. Talbot Ross said they are only required to get input. Guerin followed up by asking whether the committee could override local decisions. Talbot Ross said the committee does have this authority.

Representatives of Housing Justice Maine, the Maine Immigrant Housing Coalition, the Maine People’s Alliance, and the Greater Portland Land Trust also testified in favor of passage of LD 1673.

Anthony Jackson, of Housing Justice Maine, and who served on the recently completed Commission to Increase Housing Opportunities in Maine by Studying Zoning and Land Use Restrictions, said Maine is “falling short on a human right” by not creating affordable housing. 

Jackson added that the state’s current structure prevents current housing from being creative and that the zoning process needs to be streamlined to “meet dire need.”

Kate Dufour of the Maine Municipal Association testified against the bill. Dufour expressed concern that the bill, as written, “shifts authority away from planning boards to local boards of appeal.” This, Dufour said, is important, because planning boards are most familiar with local ordinances and policy goals, and have to be equitable in enforcing them. Dufour also noted that not every municipality has a local board of appeals.

Erik Jorgensen, Director of Government Relations at the Maine State Housing Authority, testified neither for nor against the bill. Jorgensen expressed concern about the “new areas of authority” the bill would give to his agency.

Jorgensen said the bill’s requirement that the agency maintain and update a rating of Maine towns each year would likely pose challenges.

“To create such a register and update it on an annual basis for each of Maine’s communities would be a significant, complex and costly undertaking. There is no part of our current operation where this would naturally fit – we would likely need to establish a new department to staff the creation and maintenance of such a register,” Jorgensen said in his testimony. 

Nick Murray, policy analyst at Maine Policy Institute, testified in opposition to the bill, arguing its standards would make development costly and uneconomical for developers, and would likely result in less development once towns are considered in “good standing” under the law in order to avoid additional scrutiny from the state-level appeals board and Maine Housing.

“It is not worth instituting a policy that would ultimately stifle the overall market for housing. We need supply, which means we need more options. This bill would limit the options available to developers, localities, and ultimately Maine people,” Murray said to the committee. 

LD 1884

The committee also held a public hearing on LD 1884, an emergency bill that would prohibit municipalities from using income requirements as a condition to allow residential construction. The bill would also prohibit municipalities from establishing minimum lot sizes for agriculturally zoned land that are more than twice the lot sizes of the most restrictive residentially zoned land.

The bill was sponsored by Rep. Bruce Bickford (R-Auburn). According to Bickford, the bill is designed to “protect the rights of people who wish to homestead, build a home, and work their land, if they choose, to feed their family while earning a modest income outside of their homestead.”

During the hearing, Bickford discussed how income requirements passed in the 1960s have been used in Auburn to “prevent all growth and to protect the so called ‘character’ of their more rural neighborhood.”

The current Mayor of Auburn, Jason Levesque, also testified in favor of the bill.

“This type of socio-economic discrimination has torn our city apart, has exposed some hard truths about past generations’ intentions and the negative effects it has had on thousands of Auburn residents. I give you this overview as a cautionary tale for the legislature. I’m not asking you to fix Auburn, but to ensure that municipalities do not copy Auburn’s exclusionary zoning in face of sweeping changes you make to address the affordable housing crisis,” Levesque said.