Affordable housing developers plan to move forward, despite Portland's Green New Deal - Press Herald

The Portland City Council on Monday is expected to choose a developer to build 90 units or more of mostly affordable housing in the Libbytown neighborhood. Each proposal contains a diverse range of housing, from traditional apartments and condos, to a cooperative model and single-family homes with accessory dwelling units.

Councilors held a workshop on Thursday to hear presentations from two development teams that responded to the city’s request for proposals for 43 and 91 Douglass St. And one issue on the minds of councilors and developers is what impact the Green New Deal for Portland would have on the projects.

“We know that our school elementary renovations will probably be significantly hampered by the passage of that referendum and I know it will have impacts on other projects,” City Councilor Nicholas Mavodones said.

Both development teams, which opposed passage of the ballot measure, told city councilors last week they plan to move ahead, despite financial impacts from the new requirement passed by voters on Election Day.

One development team consists of Avesta Housing, Jack Soley and Hebert Construction, which is looking to building 90 units of housing. And the other consists of the Szanton Co. and the Maine Cooperative Development Partners, which is proposing 108 units.

Both proposals, as originally contemplated, would be subject to the Green New Deal for Portland, which applies to projects that receive $50,000 or more in city funding. Those new requirements, enacted by voters Tuesday, require projects to participate in a formal apprenticeship program, pay prevailing wages, meet higher energy efficiency standards, increase the percentage of middle-income housing, and lower the income levels that determine affordability.

Avesta’s original plan budgeted $94,430 in tax increment financing from the city, while Szanton’s project budgeted $371,608 in tax increment financing, plus an additional $400,000 in funding from either the city’s housing trust or through its Community Development Block Grant program and another $750,000 in Brownfield funding. Both projects will seek funding through the state’s competitive low income housing tax program.

Avesta President and CEO Dana Totman urged the council to keep the impacts of the Green New Deal at the forefront of their decision-making.

“We have to deal with that,” Totman said. “Frankly, we do give some very serious consideration about how we might avoid the requirements the Green New Deal triggers. We do have the ability to find other funds as a nonprofit and are already considering that.”

Totman noted that the city would see more revenue from his team’s proposal. He said financing for the workforce condominiums is already in hand and the project relies on less public funding. Avesta is offering more for land ($575,000 vs. $475,000) and its project would generate $13 million in property taxes over 30 years, as opposed to $3.7 million over 30 years with Szanton’s.

Szanton, meanwhile, expressed confidence that its project remained viable, though his team had yet to take a close look at how the referendum would impact the project.

“We think that where there’s a will, there’s a way,” Szanton said. “And we will deal with the Green New Deal. We have dealt with all bureaucratic requirements imposed on us for developing affordable housing so far. We don’t think we would be deterred or stymied by the Green New Deal.”

The Avesta-Soley “Douglass Yards” project would consist of a 40-unit rental building for low-income tenants, a 30-unit condominium building targeting middle-income households, and 10 single-family homes with one accessory dwelling unit each, which could be rented to supplement income or be used as additional living quarters for family members. The project would also include communal amenities, like solar power, bike storage, a large community room, community patio and gardens, a dog run, and homeownership class/financial counseling.

The Szanton project proposes 108 units of housing. Its “Douglass Commons” proposal includes a 56-unit apartment building plus 52 limited equity cooperative units in seven separate buildings. The project would formally restrict affordability for all of the units, but Soley said the condos in his project would likely remain affordable based on their size and location, though they will not be restricted as such.

Nathan Szanton said his project includes more two- and three-bedroom units, which would allow for more families. He said the site is next to athletic fields, a public swimming pool and a skate park. And the affordability of the units – including targeting households earning between 60 and 120 percent of the area median income – would be preserved for 30 years through deed restrictions.

“If there was ever a site for a family project, serving families with kids, this has got to be it,” Szanton said, adding that people have an opportunity to earn equity through the co-op model. “Our project breaks the cycle of lifelong renting.”

The proposals were reviewed by two different council committees, which favored opposing projects. The Housing Committee expressed a preference for the Szanton project, while the Economic Development Committee and city staff formally recommended that the council approve the Avesta project.

Regardless of which team the council chooses, it will be months – if not years – for either to move forward, though both teams agreed that Avesta-Soley could get underway nearly a year sooner, since it’s not relying on as many different types of subsidies.

Once the council chooses a team, staff still needs to negotiate a purchase and sales agreement, which also needs council approval. The council would also need to grant a zone change for the projects to proceed to the Planning Board for necessary approvals. A zone change could take up to nine months, officials estimated.

Soley said he already has financing lined up for his condos and would be ready to break ground once the zoning is changed and site plans are approved.

Councilors were generally encouraged by both proposals, which are bring proposed by developers with strong track records in Portland.

“I’m really thrilled to have these two proposals to choose between, because I know either one of them would be tremendous for the city,” City Councilor Belinda Ray said. “It’s a tough choice.”

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