In a first for Maine, voters in Rockland have decided to borrow money to help boost development of affordable housing.
The bond, which Rockland residents approved June 10 by a 352 to 250 vote, authorizes the city to borrow up to $10 million to promote development affordable and workforce housing. The move is aimed at making it easier for people earning lower or average incomes to find housing in the city as real estate prices continue to outpace pay increases.
The city has been hit hard by the housing crisis like most other municipalities in the midcoast — nearly all communities in the region lack affordable housing. Rockland has taken several measures to help mitigate the effects of the crisis, from zoning changes to allowing the development of several new affordable housing units.
This new bond will hopefully incentivize even more developments, said Rockland City Council member Nathan Davis. The city has a goal to add 50 housing units per year for the next 10 years.
“This is the first such effort in the state, and I’m quite proud of that, and I hope it spreads to the rest of the state,” Davis said.
The details on how the bond will be used will be determined by the city’s Housing Task Force, Davis said. However, ideas are being floated, such as low-interest loans, property and land acquisition and infrastructure improvements. Infrastructure improvements could be funded through the bond to make sure sewer, roads and water can support new developments.
The bond will also be “revenue neutral,” which means that the city will be recouping the money spent by the bond through taxes and loan repayments. Because the bond will be assisting with the development of affordable housing, those new units will pay property taxes, hopefully allowing the bond to pay for itself, Davis said.
“You build a road, and maybe it will enable or even incentivize more development down the line, but it does not itself generate revenue. The housing bond is going to fund projects that will be taxable, and so for every taxpayer outlet, we will see tax revenue on the other end of it,” he said.
Adam Lachman, another city councilor, said the bond may even generate positive revenue. He hopes that any funds, either through loan repayments or tax revenue, can go back into the city budget to continue funding housing.
And, what the funding can be used for will vary. Those wishing to construct accessory dwelling units and developers of multi-family housing may be able to use bond funds, Lachman said. The goal is to add all types of housing in Rockland but primarily focus on the “missing middle” — those who don’t qualify for low-income programs, but cannot afford market housing prices.
“These are people that are already in many ways here, but they can’t live here. They’re contributing to the city, but they’re forced to live further and further away,” Lachman said.
Tom Luttrell, Rockland’s city manager, said in order to guarantee that developers will use bond funds for affordable housing, the city may include deed restrictions. Further details on who will qualify for bond grants or loans and how the city will process that information will be up to the Housing Task Force. The City Council will have to approve the recommendations that the task force makes. Luttrell also mentioned the city may employ a third party to make sure criteria are met.
Lachman and Luttrell believe that after a summer of planning and determining the exact way the bond can be used, the first funds could be utilized this fall.
“That’s really what we’re trying to focus on, is providing housing from the ground up for everybody, no matter what your situation is,” Luttrell said. “Everybody should be able to live in Rockland.”
Jules Walkup is a Report for America corps member. Additional support for this reporting is provided by BDN readers.
