SKOWHEGAN — Gov. Janet Mills on Tuesday participated in a ceremony marking work that will begin on a much-needed affordable housing complex for Somerset County.

Mills was joined by House Speaker Ryan Fecteau, Skowhegan Town Manager Christine Almand and officials with the Kennebec Valley Community Action Program to tour what will become the Mary Street Apartments. Once completed, the complex will offer 40 affordable units for those unable to afford market-rate housing.

Mills’ office has touted legislation passed last year that it says will drive more affordability in housing — a program offering tax credits to encourage more housing for low- to middle-income people. The Mary Street project benefited from the program.

But the broader picture remains troubling. The need for cheaper housing continues to rise, said Jeff Levine, interim director of the Maine Affordable Housing Coalition.

“I think the state affordable housing tax credits is really the state taking on a best practice that a lot of other states have done to sort of piggyback on the federal program,” Levine said. “And I think it’s going to have really significant positive impacts as it sort of rolls through the pipeline.”

The National Low Income Housing Coalition says Maine needs around 19,000 affordable units.

The Maine State Housing Authority publishes a Rental Affordability Index  that compares the median cost of a two-bedroom apartment with utilities to the median renter’s income. If the index number is less than one, that shows that an area is unaffordable — meaning that someone with the median income cannot rent a two-bedroom apartment spending 30% of their overall income.

The index number for the state last year was 0.83 — not affordable. The median rent for that two-bedroom apartment with utilities was $1,062 a month. If a person wanted to pay that rent and have it be less than 30% of their income, their annual income would need to be at least $42,489, which comes out to $20.43 an hour.

The actual median income for the state is $35,098. That leaves 57.2% of households unable to afford that apartment.

In Somerset County, where the Mary Street Apartments will open in Skowhegan, the index score for 2020 was 0.73 — even less affordable than the state as a whole.

In the county, the median rent for that two-bedroom apartment with utilities was $920 a month, lower than the overall number for the state. But the median annual income is lower, too: $26,754. The income needed to cover the rent would be $36,812, a $10,000 difference. That leaves 63.4% of households unable to afford it.

The housing problem has been growing slowly over time, but the pandemic only made it worse, said Daniel Brennan, director of the Maine State Housing Authority.

But it’s not all bad news, Brennan said. There is attention and support for more housing options like he has never seen before.

The tax credit program provides $80 million in credits to developers who are building affordable housing units, in addition to the federal tax credit system.

Maine developers apply for the credits with the Maine State Housing Authority. The authority creates a rubric for what it would like to see in a project and awards developers “points” if their project meets various criteria. Then the projects with the most points are awarded tax credits.

The developers then turn around and sell the tax credits to businesses, allowing the businesses to offset their taxes and providing the developer with cash for their project.

Gov. Janet Mills greets 4-month-old Sam McCabe and his father, Jeff McCabe of Skowhegan, as she participates in a ceremony Tuesday in Skowhegan for a new affordable housing project on Mary Street. Rich Abrahamson/Morning Sentinel

And that results in more housing projects, Brennan said.

“We are in a position now where instead of being able to do five or six projects a year, we need to do 20, 25. And instead of a couple hundred units a year, we should shoot to do 1,000 a year,” Brennan said. “And this year we’re going to complete about 550 units. So we’re getting just a tremendous amount of support from the state and federal government to invest in affordable housing right now, which is really great.”


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