Kate Snyder heard from many resident about Portland’s affordable housing problem while she was on the campaign trail. She plans to work with the City Council on the problem once she takes over the mayor’s office next month. Ben McCanna/Portland Press Herald
PORTLAND — Soon after Kate Snyder takes office as mayor Dec. 2, she’ll meet with the City Council to present her goals for the next year. Chief among them will be tackling Portland’s housing problem.
“The primary concern I’ve talked with folks about is property taxes and housing affordability – how much it costs to purchase a home or rent an apartment,” she said in an interview last week. “The role taxes play in housing affordability is real whether you are renter or property tax payer.”
Finding alternative revenue streams to cut property taxes, the construction of more affordable housing units and better use of the city’s Housing Trust Fund are possible solutions to make Portland housing more affordable for people, Snyder said.
A household needs to make at least $102,173, almost double the median household income of $51,799 in Portland, to purchase a median priced, $316,000, home in the city, according to Maine Housing. Of owner-occupied homes in Maine, 29% pay 30% or more of their income towards housing costs, the city says. Meanwhile, 47% of Portland residents live in rental units.
“One of the things I heard on the campaign trail is the need to diversify and expand revenue,” Snyder said.
She’s interested in the idea of a local option sales tax or hotel room tax. That, she said, “affords the city to generate some income to the municipality, especially as it relates to tourists and those coming into town.”
Lack of housing stock is another problem for the city. That problem is compounded by property owners who opt to rent their houses or apartments out through AirBnB and similar companies, making them available for short-term rentals rather than permanent housing.
Snyder said she will work with the council and city leaders to find ways to increase housing stock to meet the demand, especially for affordable housing, by looking at what city-owned land might be appropriate for more.
The City Council joined a number of neighboring communities this fall in passing a resolution to increase the number of affordable units constructed in the greater Portland area. Portland’s goal, as laid out in the 2017 Comprehensive Plan, is to create 256 units per year by 2027, including 136 to 159 that are affordable at the median income.
In total 2,300 units of residential housing were approved by the Planning Board from 2014 to August 2019, according to the city.
Snyder said another tool to increase housing stock is using the Housing Trust Fund to “leverage tax incentives for affordable housing developers.”
Over the last two years, Portland has awarded more than $1.9 million in Housing Trust Funds. The fund’s revenue, which stood at just over $890,000 as of October 2019, is generated from fees from the Housing Preservation and Replacement Ordinance, a portion of revenue from the Short Term Rental Registration Program, fee-in-lieu contributions from the Inclusionary Zoning Ordinance and other funding streams.
The goal of the Housing Trust Fund, the city says, is to provide for the “promotion, retention and creation of an adequate supply of housing, particularly affordable housing, for all economic groups and to limit the net loss of housing units in the city ” and to “serve as a vehicle for addressing very low, low and median income housing need.”
Recent Housing Trust Fund allocations have gone to renovation projects at 18 Luther St. and 47 Boyd St. and construction of a 46-unit senior affordable housing project at 83 Middle St, that will set aside units for long-term residents of the city homeless shelter, a project Snyder called “really promising.”
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