As the 131st Legislature opened in December, Democratic leaders said that addressing Maine’s housing crisis was their top priority this session and formed a special committee to examine the issue. Now, they’re looking to ensure that funding is available for any recommendations made by that group.

Rep. Rebecca Millett, D-Cape Elizabeth, is proposing a $200 million investment to increase the stock of affordable housing in the state. It’s one of many housing bills that will be considered by the Joint Select Committee on Housing, which the Legislature created this session.

“My bill is designed to say that $20 million is not enough – $50 million is not enough,” Millett said. “We’ve got to be thinking bigger and we can’t just do a one-off. This is something that we have to be investing in as a state for a number of years. We have so many people who are in really desperate situations.”

Millett’s bill would make a one-time general fund allocation of $100 million in each of the next two fiscal years to MaineHousing, an independent state agency that oversees subsidized and affordable housing projects throughout the state.

Other lawmakers are proposing housing bonds, but the details are not yet available. And Rep. Benjamin Collings, D-Portland, has proposed an amendment to the Maine Constitution to make housing a human right.

The joint select committee has a list of 18 recommendations outlined in a 222-page report that was the basis for its formation.

Sen. Teresa Pierce, D-Falmouth, who co-chairs the committee, said the group will review a variety of bills dealing with the urgent need to provide emergency housing to people who are homeless or marginally housed, adding housing of all types throughout the state, and any long-term changes to land use and zoning laws to further encourage housing development.

Deering Place, an affordable housing development in downtown Portland, opened in June. Shawn Patrick Ouellette/Staff Photographer

Pierce said the joint commission could issue recommendations for bills sponsored by other lawmakers, or propose its own legislation that uses other bills as a springboard.

“This is an amazing opportunity to look at the housing issue across the state,” said Pierce, who is co-sponsoring Millett’s bill along with Sen. President Troy Jackson, D-Allagash. “I see that (bill) as a starting point for conversation. There will be a lot of housing bills coming forward.”

But increasing funding for MaineHousing alone may not be enough. A recent report from the agency said that projects currently in the development pipeline are “dramatically constricted by workforce shortages and supply chain troubles,” which will likely cause rents and home prices to continue to increase in 2023.

“We can’t have housing in Maine without a robust skilled workforce,” said Sen. Matt Pouliot, R-Augusta, who serves on the joint select committee. “This bill from Millett and Sen. Jackson does nothing to address that issue and will do very little to advance the alleviation of the crisis that we have.”

The housing situation across the state is dire, primarily because of a lack of inventory, rising interest rates, inflation and a lack of skilled labor and building supplies. Homeless shelters are full and families staying in hotel rooms face an uncertain future when funding dries up at the end of April.

The crisis is affecting just about everyone, from people who rely on housing vouchers to middle-class workers who are unable to find an affordable rental or homeownership opportunity.

With state revenues expected to remain strong over the next four years, some lawmakers are calling on the state to make significant investments in affordable housing, whether through bonds or direct investments from the general fund.

Gov. Janet Mills has proposed a $10.3 billion budget for the next two years – a $900 million increase over current spending. Her budget proposal, which can be changed by lawmakers, includes $30 million for affordable and workforce housing construction. That’s on top of a $20 million investment approved by lawmakers this month to expand the affordable rental housing program in rural areas of the state.

Greg Payne, the governor’s senior housing adviser, did not comment specifically on Millett’s bill. Instead, he noted that Mills has invested more money into affordable housing than any other governor, including signing a senior housing bond that led to 180 new affordable units and an $80 million investment into the Maine Affordable Housing Tax Credit Program over the next eight years.

“We look forward to further discussions on legislation to address Maine’s housing challenges with the Legislature’s new Select Committee on Housing,” Payne said. “Every person in Maine should have the opportunity to have warm, safe and secure place to call home, and we will continue to look for every solution possible to address this important issue facing Maine’s people, economy and workforce.”

Payne said that groups like the National Low Income Housing Coalition estimate that Maine needs an additional 20,000 to 25,000 units of affordable housing to meet demand. But that was before the pandemic, he said, so the state has commissioned a new statewide study on the housing shortage that should be ready by the summer.

INVESTMENTS WELCOME

A spokesperson for MaineHousing, which would receive the funding, said the state housing authority would welcome any additional investments, especially if it can be used for a variety of programs.

Spokesman Scott Thistle said one program that could use more money is the rural rental development program. He said the $20 million allocated to that program this month was fully committed in a matter of weeks.

“We have a record number of developments in the pipeline,” Thistle said. “We would welcome the funding. The more flexibility the better. We have lots of ways we could apply it.”

Thistle said 85 projects, representing 3,600 units, are currently in the pipeline, which is more than at any point over the last 30 years.

Millett said her bill, L.D. 226, seeks to give MaineHousing the flexibility to use the money as needed, as long as it is used to increase the number of affordable housing units.

“As long as it’s used for the construction of new affordable homes – get it out there,” she said. “I don’t want to be overly prescriptive, because they know which particular programs have the capacity to handle that kind of investment.”

Affordability is generally defined as household paying less than 30% of its income on housing-related expenses, including rent/mortgage, utilities, taxes and maintenance. However, MaineHousing has a variety of income-based housing programs that could be used as a guide.

Pouliot, a real estate agent, said it makes little sense to invest money in building homes if there aren’t enough workers to build them.

Pouliot has submitted a placeholder bill for a proposal that would seek investments in local manufacturing facilities across the state, with the goal of providing a catalog of housing plans that could meet zoning requirements in communities throughout the state.

Pouliot compared his vision to home kits offered by Sears in the 1920s, back before modern zoning codes existed. He said his proposal could boost employment, simplify the homebuilding process and help reinvigorate mills across the state.

“If they want to put $100 million towards this I would be all for it,” Pouliot said. “But I can’t get behind putting $100 million into an existing system that we’ve all said needs improvement.”