Avesta Housing, developers of 17 Carleton Street, gained unanimous approval for tax-increment financing (TIF) from the Housing and Community Development Committee of the City Council. In return the developer promised to provide “deep income targeting.”
The Affordable Housing TIF will rebate 65% of future tax income from the property for twenty years. The rebate goes back to the developer, Avesta.
In return, Avesta will offer efficiency apartments that are affordable to people earning forty percent (40%) of area median income (AMI), about $20,000 annually. The rent needed to qualify as affordable for residents earning 40% AMI is $540 per month.
“We are bringing some deep income targeting to the neighborhood,” Avesta Development Officer Drew Wing testified to the Committee.
Because some of the rents will be that low, Avesta wants the TIF to help meet the financiers’ required debt-to-income ratio.
The project will feature 37 affordable units. The mix will include 12 efficiency, 23 one-bedroom and 2 two-bedroom units.
East End Councilor Kevin Donoghue, Chair of the Housing Committee, was concerned that a property close to schools would have little family housing, with only 2 two-bedroom units.
“How would this Council make sure there were more kids put in these projects?” asked Councilor Donoghue.
Jeff Levine, head of Planning and Urban Development, did not think there was much the City could do. The state’s affordable housing financier, MaineHousing, will only provide financing to projects that meet low per unit construction costs. The per-unit costs are not adjusted for the increased costs of building in downtown Portland.
“Small units are much more likely to get funding by MaineHousing,” noted Jeff Levine.
“I didn’t even know there was room for 37 units on Carleton Street,” said West End resident Steven Scharf. He was the only member of the public to testify to the Housing Committee. He felt the TIF offered too large of a rebate, adding up to approximately $30,000 per year.
Neighbors will have a chance to ask questions of Avesta at a neighborhood meeting tonight, June 11th, at 6 p.m. The meeting will be held in the Reiche School Cafeteria, and the purpose is to introduce the project to neighbors as part of the City approval process.