With the approval of two new Tax Increment Financing districts in Biddeford earlier this month, there is cause for celebration, but also cause for concern.
While the TIFs mean the continued development of the downtown and mill district, not all development is created equal.
The article about the news in the Journal Tribune created a flurry of online comments from readers who said that the new apartment complexes that secured the new TIFs are not the type of development that Biddeford needs. We tend to agree.
“Affordable housing” translates to “low-income housing” to employed middle-class people looking for a place to rent. There is a stigma attached to living in a building with income guidelines, and that stigma may keep out the professional crowd that Biddeford is looking to attract.
In addition to the type of development, the developers are seeking the TIF to get a portion of their tax money back.
TIFs shelter tax money from new development into funds that can be used by the municipality to make improvements in that area, or they can be set up to do other things, like provide tax credits to companies. However, we think the money is better spent by cities and towns, whether it’s for road work, new lighting, parking or beautification. While the money can be funneled back to a company or developer, it may not be the best decision for the town or city.
Under the recently approved proposals, each developer will get a TIF that will direct a portion of the taxes they pay back into the companies. For the first ”“ The Laconia House LP at the Pepperell Mill Campus ”“ 50 percent of the taxes for the new assessed value to be used for the project for 15 years, with the other 50 percent to go to the city’s general fund. After the TIF expires, all of the taxes would go to the city.
For the second, the Lofts at Saco Falls, for the first 15 years of the 30-year TIF, the developers would receive 75 percent of the newly generated taxes, which would decrease by 4 percent each year until it expires.
If these projects will only be feasible with the TIFs, they may not be the best projects for the city. And while Biddeford’s Economic Development Director Daniel Stevenson said the projects are in line with the Mill District Master Plan’s land use breakdown for housing, the plan doesn’t specify that residential growth should be “affordable housing.”
Other developers right here in Biddeford have been able to create market-rate apartments that are filled to capacity ”“ and even have a waiting list. And they’re not cheap.
The Pepperell Mill Campus, owned by developer Doug Sanford, has more than 80 studios and one-, two- and three-bedroom apartments and luxury lofts. The rents start at $800 and go all the way up to $2,300 ”“ and they’re full.
Sanford has said a hotel and new restaurant plan to locate on his property, and they will need more parking.
A few months ago, we heard that a parking garage was the next step for Biddeford, and it could be paid for completely through TIF funds. At the time, Stevenson’s mantra was, “if we build it, they will come.”
In his memo to city councilors about the new projects requiring TIFs, Stevenson mentions that some of the money generated will help pay for that garage, but we’re wondering why that’s not happening first.
If parking were not an issue, and developer interest is as high as those in the know say it is in the now Maine Energy-free downtown, mill tenants would likely be easy to come by. There may even be developers competing for the space.
While these two projects are going forward, Biddeford needs to take another look at the Mill District Master Plan and decide if any housing or any companies are fine, or if the city wants to be more selective in its awarding of TIFs and other incentives to bring in developers. The city should consider carefully and choose projects wisely that will enhance the downtown and make sense in the larger picture.
We hope city officials and councilors will take a good look at future proposals and make the best decisions for Biddeford’s future.
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Today’s editorial was written by City Editor Robyn Burnham on behalf of the Journal Tribune Editorial Board. Questions? Comments? Contact Managing Editor Kristen Schulze Muszynski by calling 282-1535, Ext. 322, or via email at kristenm@journaltribune.com.
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