BIDDEFORD — The City Council has approved a Credit Enhancement Agreement with Saxon Partners to build 250 apartment units on Barra Road in Biddeford, aimed at housing those working in the medical field.

As well, the city will work on a Joint Development Agreement with Mike Eon Associates, Ltd., Indian Cliff Development Corporation and Sawmill Park Properties, LLC (Eon Entities) on a master plan for about 70 acres of land adjacent to the proposed Saxon Partners apartments.

Planning and Development Director Mathew Eddy told the City Council on Aug. 3 that building costs have risen substantially since the contract zone was first approved in December 2019, hence the 20-year Credit Enhancement Agreement request.

“(It will) provide for affordable housing and serve the medical community with a flexible lease rate that meets the different needs,” Eddy told the council.

The Credit Enhancement Agreement means that the city will receive $255,000, or about 67 percent of the property tax taxes in the first year, escalating by 2 percent in the next two to five years. For years six through 20, the city will retain about 65 percent of the taxes paid by the owner. As well, Saxon has pledged to contribute $125,000 to Biddeford’s affordable housing goals. Starting in the 21st year, the city will retain 100 percent of property taxes.

“Captured in a separate Joint Development Agreement, furthering the creation of additional housing, Eon Properties have agreed to negotiate in good faith and create a mutually agreeable Mixed-Use Master Development Plan for the remainder of the property,” said Eddy in a memo to the council. “Within that plan, a portion of the total acreage will be reserved for senior affordable housing; a 35–45-unit project is contemplated.”

Under the terms of the JDA, if Eon Entities does not complete the master plan or the senior housing project within a specific period, the lot set aside for senior housing will be turned over to the city.

The Saxon apartment proposal  contains flexible lease rates and terms designed to meet the needs of those working in the health care industry, Eddy noted. Affordability is in the project design; to keep rents at levels consistent with local salary ranges.

The apartment project has the support of Southern Maine Health Care, the Biddeford and Saco Chamber of Commerce and Industry and the University of New England.

It did not have the support of City Council President John McCurry, who said taxes are heading up for every multi-unit building in the city “and we’re talking about a credit enhancement.”

“I don’t think we should subsidize everything that comes by,” said McCurry. “They should pay what the taxes are.”

“It includes affordable housing and (they’re) working with us on a master plan, so there’s a lot of potential here,” said Councilor Doris Ortiz, who said she supported the project because of the affordability piece.

Councilor Marc Lessard pointed out that the average tax the city receives per lot on Barra Road is $42,000 annually. “This will generate $255,000,” he said, adding that most apartments will be occupied by one person and therefore not impact the school’s system.

Lessard said the city engaging in a master plan with the developer is unheard of. “I strongly urge the City Council to consider authorizing this,” Lessard said.

“I agree with Councilor Lessard,” said Councilor Norman Belanger. “Even with CEA we’d get more than if we left this on the open market; I don’t think we’re giving up a lot, and a master plan that considers preserving green space, hiking trails and senior housing is very valuable.”

Councilor Stephen St. Cyr expressed disappointment that the developer was seeking a CEA but noted there would not likely be another project soon that would create as much revenue for the city.

“Too often a CEA has become a bogeyman when actually it is a government tool that lets you get something done that without it, cannot get done for whatever reason,” said Mayor Alan Casavant. “When you give a credit enhancement the goal is to get something back in return, and we’re getting relief in terms of housing, and while you say it is specific to a certain group of people, it frees up housing in the rest of the city and gives (us) some affordable housing, so I think it’s really important to consider the impact on the city. The reality is we need this.”

In the end the majority of the council agreed. Both McCurry and Councilor Michael Ready dissented. Councilor Ashanti Williams was absent.

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