AUGUSTA — City councilors gave initial approval to a proposal to lease the former Hodgkins Middle School so it can be redeveloped into housing for low-income senior citizens.

The Augusta Housing Authority and developer Kevin Bunker, who has experience converting old schools into housing, hope to secure a long-term lease from the city to turn the vacant former middle school into senior housing.

Thursday, city councilors voted unanimously to authorize City Manager William Bridgeo to negotiate an agreement to lease Hodgkins for redevelopment and bring the agreement back to councilors for review and, potentially, their approval.

Councilors praised the proposal, noting it could provide needed housing while also reusing a building the city has, so far, had no luck repurposing for new uses.

“I think it could be a great project, we’ve been trying to figure out what to do with Hodgkins for quite some time,” said Councilor-at-Large Jeffrey Bilodeau.

Bridgeo said the lease charge from the city probably would be nominal, perhaps only $1 a year, and the project probably would need a tax increment financing deal from the city to help fund improvements to the old school.

He said the benefits to the city could include the reuse of a public building that is in significant disrepair, including the presence of asbestos and mold. It would create new affordable housing for the elderly in an already residential neighborhood and help fulfill city officials’ goal of working more closely with the housing authority to improve opportunities for people of all incomes.

The quasi-municipal Augusta Housing Authority would create a for-profit subsidiary, according to Bridgeo, to allow it to seek federal and state historic preservation tax credits. It would also need to secure low-income housing tax credits from Maine State Housing Authority to help pay for the project.

Bunker, of Developers Collaborative of Portland, converted the former Gilman Street School, once Waterville’s high school, into Gilman Place, a 35-unit apartment building that opened in 2011. Now the collaborative is converting the former Nathan Clifford School in Portland into 22 rental housing units. Both those projects, and several others in which Bunker was involved, used tax credits to help finance them.

Bunker said this would be the third housing authority he’s worked with in housing projects.

He said most of the schools he’s done before were older, but he said he was pretty confident Hodgkins would qualify for historic preservation tax credits.

Bunker said he would be a “glorified consultant,” and oversee the project for a share of the developer’s fee, which Bridgeo said will be based on MaineHousing standards for such fees.

“If it crashes and burns, I don’t get anything,” said Bunker, noting he, as a proponent of smart growth, has an interest in redeveloping old schools because they are generally in established neighborhoods near community centers and services.

Amanda Bartlett, the housing authority’s executive director, said they’re looking at putting 34 to 41 apartments in the building.

She said there is a shortage of affordable, safe housing in the city and the number of elderly residents is projected to increase, in Maine and in Augusta.

She cited statistics showing 60 percent of renters in Augusta are unable to afford the average rent for a two-bedroom apartment, with utilities included, of $744 a month.

And a rental housing market study done in 2013 for the old Cony flatiron building, which is also in the beginning stages of a project to convert it into senior citizen housing, indicated a need for additional rental units to accommodate a projected additional 192 renters over age 65 in Augusta between 2013 and 2018.

Hodgkins, tucked into a residential neighborhood on Malta Street, just off Cony Street, closed as a school at the end of the 2009 school year in a cost-cutting move. Students in grades seven and eight now attend classes at Cony High School. The school department turned the building over to the city after it closed as a school, and it’s been vacant, unheated, with boarded windows in the years since.

The roof has leaks, some floor tiles have cracked, and providing accessibility for people with disabilities has been a challenge at the multi-level building.

Bunker said the “gold standard” for such a development would be to make the entire building accessible to people with disabilities, but the project could seek a waiver for those standards for a few units if it can show it would be too costly to make those units fully accessible.

The 30,575-square-foot building, built in 1958, has a large parking lot and a gymnasium. Bridgeo said the developer expressed interest in the entire building and enough land to provide parking and a buffer between it and neighbors but probably would not use the entire 20-acre property.

He said the city would keep the athletic fields around the school, and they would not be included as part of the deal.

A project timeline provided by Bunker envisions the project going to the Planning Board for approval this July, construction starting in July of 2015, and completion in May of 2016.

The project can’t be reviewed by the Planning Board until the housing authority can show it has title, or at least an option, to show it has a controlling stake in the property.

Bridgeo noted the proposal is similar to two senior-citizen housing projects the city has developed with Cynthia Taylor, of Housing Initiatives of New England. The Inn at City Hall opened in 2001 and the former Cony High School project calls for 48 rental units at multiple income levels.

Bartlett said she has spoken to Taylor about the two projects and how they can work best together.

Bartlett, who became the Augusta Housing Authority’s new executive director in December, has said she wants to expand the authority’s role in providing affording housing in the area.

Keith Edwards – 621-5647 | kedwards@centralmaine.com | Twitter: @kedwardskj