Gov. Janet Mills is expected to sign into law a bill that advocates say could substantially increase the number of affordable housing units built in Maine over the next eight years.

The measure would provide the first state-level tax credits to developers building new homes and apartments for poor and elderly Mainers and preserve existing rural housing.

Up to $10 million a year would be allocated to leverage federal funds and private investment for new housing. Advocates say it could create 1,000 new units and save another 500.

“This proposal represents the largest investment that Maine has ever made in creating and preserving affordable homes, and it couldn’t come at a more critical time,” said Greg Payne, director of the Maine Affordable Housing Coalition, in a statement.

More than 17,000 low-income people are on housing waiting lists that stretch more than five years, according to testimony the Maine Housing Authority gave on the bill last year.

“This is a game changer. This tax credit is a substantial and critical investment in building a Maine where everyone can afford a good, safe home,” said Daniel Brennan, director of the Maine Housing Authority, in a statement.


The bill, LD. 1645, sponsored by Assistant House Majority Leader Ryan Fecteau, D-Biddeford, unanimously passed the House and Senate on Thursday.

“I think that speaks to the common understanding in both parties that need for affordable housing is resonating across every district,” Fecteau said in an interview.

The bill will offer developers breaks on income taxes in exchange for investing in housing. It mirrors federal tax credits used to build almost all the affordable and low-income housing in the country.

At least 30 percent of the funding has to be spent on housing for seniors and another 20 percent for homes in rural communities. Ten percent of the funding has to be directed to renovate rural apartment developments.

To ensure the housing is affordable, nearly two-thirds of the units must be reserved for families who earn 50 percent or less of the area gross median income. In Cumberland County, a family of four living on $37,000 a year met that threshold last year.

An original version of the bill envisioned spending $20 million over four years, but it was modified by the Legislature’s appropriations committee to meet budget, Fecteau said.


“It will still increase our production by 50 percent – that’s something to be proud of,” he said.

“I think this is a substantial measure for affordable housing, more than anything I’ve seen in the six years I’ve served in the Legislature,” Fecteau added. “It comes at the same time the need is the most pronounced; we are seeing effects in all parts of the state.”

Additional funding could help the Portland Housing Authority renovate its stock of homes and apartments and construct new buildings, said Executive Director Cheryl Sessions.

The waitlist for Portland Housing properties is two-and-a-half years, she added.

“There wasn’t really anything on the state level that was helpful” to add housing units, Sessions said. “It helps fill in the gaps.”

In her State of the State address last month, Mills highlighted Maine’s affordable housing troubles and pledged her support for the bill.


“To encourage young families to come here and work here, Maine also needs affordable housing,” Mills said in her address. “Send that bill to my desk, and I will sign it.”

A signing ceremony for the bill is being scheduled, said Lindsay Crete, the governor’s press secretary.

In an unrelated development, U.S. Sen. Susan Collins, R-Maine, has announced more than $1.65 million for housing and community projects in the state from Neighbor Works America, a public nonprofit.

Avesta Housing Development Corp. will receive $434,500; Coastal Enterprises Inc., $527,500; Community Concepts Inc., $316,500; Kennebec Valley Community Action Program Housing Services, $140,000; and Penquis Community Action program, $332,00.

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