How can Maine fix its housing crisis? A new report has dozens of ideas

Yahoo

30-01-2025

Jan. 29—Recent reports on Maine's housing crisis have carried some eye-popping numbers: The state needs to build 84,000 homes by 2030. Washington County needs to increase its annual number of building permits by 1,200%. The median home sale price was nearly $400,000 last year.
For years, state housing officials and advocates have argued that the only way to shrink those numbers is simply to build more. When the need is so great, the task can seem overwhelming. But a new state-sponsored report, presented this week to the Legislature's Committee on Economic Housing and Development, issued specific recommendations for how to do just that — 83 pages of them.
And it could set the stage for the Legislature's upcoming session.
Two years ago, the state released a report that declared Maine is short about 84,000 homes, and that the total housing stock — not just the number of new homes being built — needs to increase by about 11% by 2030 to alleviate the existing housing crisis and make room for all the people needed to bolster the state's declining workforce.
Then, in September, officials broke down the needs at the county level and established housing "goals," finding that annual housing production statewide needs to just about double.
The September report included a long list of suggestions — including infrastructure improvements, increased state and federal funding for affordable housing development, and simplified building and land-use regulations at the state and municipal levels — but did not require any changes or include direct money to any particular solutions.
This week's report drills deeper into those suggestions, offering a more granular look at the ways the state can incentivize development, data collection and workforce development. It also lays out which options are the most and least cost-effective and labor-intensive.
Most of the 40-plus changes outlined would require legislative action, so the report is partly intended to serve as a roadmap for Maine's lawmakers as they draft and consider new housing bills.
"If we know our needs and we know our goals, the next question is, how do we get from where we are now to where we need to be by 2030?" said Greg Payne, the state's senior housing adviser. "What state-level policy levers exist that we can pull to create more homes more quickly, and at a more sustainable cost?"
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The reports come at the behest of the Legislature as part of LD 2003, a law passed in 2022 that, among other changes, requires municipalities to allow up to four units on any property zoned for single-family residential use.
The landmark law was "a step forward," according to the newly released report, but significant challenges remain.
"Delays in development approvals, high impact fees, uncertain infrastructure costs, and resistance to increased density continue to make it difficult to deliver homes that are affordable for most Mainers," HR&A Advisors wrote.
HR&A, a consulting firm, provided research for the first report and authored the most recent.
Some recommendations include:
— Increasing the pace and volume of housing development reviews and appeals
— Reforming state and local building codes to reduce development costs
— Establishing a mixed-used income housing fund
— Preserving mobile homes and exploring modular and 3D-printed housing
— Finding state-owned properties that could be sold for housing development
— Increased subsidies for affordable rental and homeownership programs
Few of the recommendations are revolutionary, but if adopted, a handful could prove to be unpopular among municipalities, many of which have pushed back against implementing the zoning changes required by LD 2003.
For example, all three reports have emphasized the need for accurate and comprehensive data collection. Currently, housing production data is tracked by the U.S. Census Bureau, which compiles data voluntarily submitted by municipalities. One suggestion follows the lead of states like Connecticut and Oregon, and would require that municipalities regularly submit data on housing production and demolition. It would need to be a mandate, so municipalities couldn't opt out, the report said.
The report also suggested that towns and cities that "contribute to housing goals" should be prioritized for state funding.
"Participating municipalities would gain prioritized access to discretionary funding, such as school renovation and infrastructure funding, by meeting or exceeding housing production targets and adopting priority zoning and land use policies," the report said. Municipalities could be scored based on their adoption of a range of policies including reducing minimum lot sizes to 0.5 acres in designated growth areas and requiring multifamily housing provisions in local comprehensive plans, among other options.
HR&A floated the idea of a housing appeals process to "limit delays and unlawful denials of housing proposals."
The state would need to determine the criteria for a project to be eligible for appeal. Some states, like Connecticut, limit eligible projects to those that include affordable housing. There could also be criteria to exempt municipalities from the appeals process.
A housing appeals process was included in earlier versions of LD 2003 but was scrapped in the scaled-back version of the bill that eventually passed. The appeal process was opposed by the Maine Municipal Association, which argued that allowing developers to take municipalities to court for denying projects undermines local housing control.
SUPPORT FOR TRADES
This week's report also emphasized the need for Maine to support the private sector, particularly by bolstering the construction trades workforce.
According to the Maine Department of Labor, the state is short between 2,000 to 4,000 workers in the construction and adjacent industries, including transportation and material workers, construction laborers, electricians, equipment operators and building inspectors.
HR&A recommended providing long-term funding for apprenticeship programs, attracting nontraditional workers, streamlining licensing for the trades and accelerating employer-financed workforce housing projects.
These recommendations wouldn't be the first steps the state has taken to alleviate the housing shortage — Maine has invested over $310 million in doing just that, according to Payne, the senior housing adviser.
"These historic investments, along with key zoning and land use reforms, have supported vulnerable residents and our workforce while creating the largest pipeline of affordable housing development in MaineHousing's history," he said in a statement. "But as reports like this show, there's more Maine could do to address this critical need."
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