The Portland City Council is scheduled to decide Monday whether to give a nonprofit housing developer a 22-year tax break worth more than $700,000 to support the construction of a four-story affordable housing complex in the prestigious West End neighborhood.

The project, which would provide 37 units of new housing at 17 Carleton St. for people with limited incomes, has drawn opposition from some neighbors over the loss of parking and whether affordable housing fits well in the historic neighborhood.

Avesta Housing President and CEO Dana Totman said the project will provide much-needed workforce housing at a time when demand for housing is high and vacancy rates are low.

“It’s just staggering to us the number of folks coming to us for housing and just sit on a list,” Totman said. “We need to stay active in creating more units of housing, and that’s exactly what we’re doing.”

Totman said the number of people who have contacted Avesta for housing in the past six months is up 27 percent over the same period last year, from 1,492 to 1,897. Meanwhile, rents in Portland have increased 17.4 percent over the past year – the second-highest rate in the U.S., according to the real estate data firm Zillow.

The half-acre site of the proposed development, which is still being reviewed by the Planning Board and Historic Preservation Board, is currently a parking lot where several nearby residents lease spots.

Opponents – particularly those who rely on the Carleton Street lot for parking – are concerned about the loss of 58 spaces and lack of on-street parking to meet the increase in demand.

Meredith Finn, who has lived at 22 Carleton St. for the past 15 years, said the loss of parking may force her to move.

“I’d be thrilled if I could get rid of my car, but I have to have a car,” said Finn, who commutes to West Falmouth when she’s unable to work from home. “Not everyone can go everywhere on a bike.”

Avesta Housing bought the half-acre parking lot and two apartment buildings – the former Butler school at 77 Pine St. and the Payson building at 218 State St., which together provide 62 units of housing for seniors and the disabled – in 2011 for $6.2 million, according to the nonprofit.

Totman said Avesta is investing $4.9 million into the existing buildings and $6.5 million in the new building, which would also have 31 parking spots on the site. The four-story building would have 12 efficiencies, 23 one-bedrooms and two two-bedroom apartments.

The housing will be targeted to individuals and families who make at or below 40 percent to 60 percent of the Portland area’s median income, ranging from an individual earning about $20,000 a year to a three-person family earning $40,000 a year, he said. Rents would range from $540 a month for an efficiency to $1,044 for a two-bedroom.

The rents are made affordable by taking advantage of housing tax credits offered by Maine Housing, Totman said, and by a requested tax break – or Tax Increment Financing deal – with the city.

The council is considering granting Avesta a 22-year tax break. Avesta would keep 65 percent of the new tax revenue over that period, which is expected to be roughly $728,000, while the city would see an additional $406,000, according to the agreement. After 22 years, the city would receive all of the taxes.

City Councilor David Marshall, who represents the West End and serves on the Housing and Community Development Committee, which forwarded a unanimous recommendation to the full council, said he supports the project and the tax break.

“We have a housing crisis,” Marshall said. “We literally have thousands of people on a waiting list to get into the city on an affordable housing program. Parking is important, but not as important as housing.”

The West End Neighborhood Association is not taking a position on the project because it has been so divisive, said Ian Jacob, the group’s president.

However, the Western Promenade Neighborhood Association opposes the project, said President Anne Pringle, noting that there are several homeowners in the West End who currently don’t have places to park their cars. She appreciates efforts that the city is making to be less car-centric, but generally people still rely on their cars, she said.

Pringle also objects to the use of tax revenue to support affordable housing. She pointed to recent housing reports that highlighted the growth of affordable and market-rate housing, but virtually no growth in so-called workforce or family housing for the middle class.

“This project doesn’t address either one of those,” she said. “We have more low-income housing than any other surrounding community.”

Totman, however, believes that the project will provided a better opportunity for young service workers and professionals to live in the city.

“It’s ideal for younger workers,” he said. “It will be a great addition to our city.”

Randy Billings can be contacted at 791-6346 or at:

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