Friday, February 11, 2011

MaineHousing Grant Brings Jobs, Homes

By Larry Favinger
Staff Columnist
MaineHousing has approved nearly $30 million in federal Low Incoming Housing Tax Credits for construction of privately owned apartments including $3.31 million for a project in Berwick.
“This provides some badly needed affordable rental housing in several Maine communities, and gives Maine’s economy a boost,” said MaineHousing Director Dale McCormick. “We expect the housing will generate several hundred jobs just in construction alone.”
The developments slated for funding and the tax credit also includes 24 units for seniors in Biddeford ($4.8 million), 29 units for families in Ellsworth, ($5.8), 48 units for families in Lewiston ($5.2 million), 25 units for seniors in Freeport ($5.5 million) and 24 units for families in Portland ($5.28 million).
The Berwick project is scheduled to provide 34 units for families and restoration of the historic Sullivan school, according to Dan Simpson, a spokesman for MaineHousing. He said he expects there will be other sources of funding for that project as well.
Simpson said one aspect of granting the funds is that the apartments “need to be affordable to low income families.”
The project, as presented to MaineHousing for funding, includes two efficiencies, 15 one-bedroom units, nine two-bedroom units and eight three-bedroom units.
McCormick said apartments affordable to working families are essential to attracting and retaining good jobs, and therefore a key component to economic development.
MaineHousing received 11 proposals from throughout the state and granted funds to six of them, Simpson said.
The criteria used for selection includes the need for affordable housing, location close to downtown and transportation, and leveraging of other funding sources. The developments in Berwick and Biddeford, for example, involve adaptive re-use of historic school buildings, while the Lewiston development involves converting a portion of the historic Bates Mill into housing.
According to a release from MaineHousing, the federal Low Income Housing Tax Credit program is a way to raise private capital to finance affordable housing. The tax credits are used to attract private investors, such as banks, insurance companies and other large corporations, to participate in the ownership of the housing developments. As part of the ownership, they receive the credits and use them to offset federal taxes.
Most of the new apartments will be restricted to households earning 50 percent of the median income or less. The tax credit funds are meant to replace the direct federal rental assistance that once was used to subsidize affordable housing.
“The tax credits are a public-private partnership to raise private capital to invest in housing with a public purpose,” McCormick said. “Many of our housing programs operate on that same public-private model.
The mission of MaineHousing is to assist Maine people to obtain and maintain decent, safe, affordable housing and services suitable to their unique housing needs.