AUBURN — Last month, when the city announced a new mixed-use development on vacant property at 186 Main St., the reaction from city officials and residents alike was positive.

A new brewery, restaurant or distillery will be located near the riverfront, with apartment units on the upper floors. It fits nicely into the city’s larger plans to attract new investment in the downtown riverfront area, and it’s good news for people looking for more dining and nightlife options.

But, some of the social media comments immediately honed in on the housing component, specifically sharing opinions on what the rent might be for the brand new apartments above a trendy brewery.

“How many rental units will be affordable housing?” one commenter said. “I’m betting none since it’s not mentioned. We don’t need more overpriced rentals. We need places locals can afford to live.”

“We need affordable housing, not high-end apartments,” another said.

As city officials on both sides of the Androscoggin River look for ways to increase the housing supply to meet demand and address rising costs, they’re also taking slightly different tacks.

Some question whether focusing too much on market rate housing will do enough to combat skyrocketing housing prices, which is putting more people on the fringes of affording the most basic housing.

Others say public funding for low-income households simply doesn’t support enough affordable units without the help of the private market, and that new private construction, while costly, can alleviate pent-up demand and boost competition for landlords who have increased prices without making improvements to their buildings.

Auburn, for example, has built a philosophy that turns away from using public funds for income-restricted affordable housing projects — calling them a “non-starter” — and instead looks to zoning to encourage a variety of housing options.

Regardless of the approach, everyone agrees, help is needed.

In just one year, from 2021 to 2022, rent prices in Androscoggin County rose more than 18%, while single-family home prices rose more than 21%.

According to a Maine Housing database, as of 2020, roughly 60% of households in Androscoggin County were considered unable to afford the median two-bedroom rental. Rent prices, along with other expenses, have only increased since then.

Last week, the National Low Income Housing Coalition released its annual “Out of Reach” report, which shows the affordability gap widening across Maine.

According to the report, which bases its numbers on spending no more than 30% of income on housing, the hourly wage needed to afford a two-bedroom apartment in Androscoggin County is $19.21. For the same unit in the Portland area, it’s $33. The state minimum wage is currently $12.50 an hour.

Fair market rents in the Lewiston-Auburn area for 2021 ranged from $781 for a one-bedroom, to $1,530 for a four-bedroom. It was a marked increase from just a year earlier, when the range was $658 to $1,365.

The high costs in part reflect low housing availability at all levels, which officials say is hurting local growth and development.

‘DEMAND FAR EXCEEDS SUPPLY’

A recent report compiled by Lewiston’s ad hoc shelter committee, which was tasked with looking at solutions to the city’s growing homelessness problem, has raised the alarm on housing affordability. The report, based on data from multiple sources — including the National Law Center on Homelessness and Poverty — states that the top cause of homelessness among families and individuals is a lack of affordable housing.

According to the report, “when new affordable units become available, demand far exceeds supply.”

Gauvreau Place, which opened last month on the corner of Pine and Blake streets in Lewiston, has 35 units, 28 of which are considered affordable. The developer, Avesta Housing, received over 1,600 inquiries.

The report says evictions have increased due to the real estate market, and rents are rising in response to “escalating costs of ownership and heating, and current tenants cannot afford the higher rate.”

“Landlords are also selling multi-units for top dollar in this seller’s market; new landlords charge higher rent to cover their higher cost of ownership, or they empty units in order to rehabilitate properties and then rent them at a higher market rate,” it said.

While the report says that Lewiston is not facing the same extremes as greater Portland, it’s happening more due to economic growth in Lewiston-Auburn.

“As a city becomes more popular and attractive, housing costs will accelerate faster than the wage growth of workers, and only market regulations and targeted affordable housing will keep regular people safely housed,” it states. “Without proactive housing policy, the homeless population will grow.”

One of the city’s responses to the housing problem is the development of more affordable housing, or mixed-income projects along with more market-rate units. The term “affordable” refers to income-restricted units for renters making a certain percentage below the area median income.

Only one project with new affordable units has been constructed in the last two years. However, there are multiple projects in the pipeline. The Picker House Lofts, a Szanton Co. project at the former Continental Mill, is planned to have 72 units, 46 of which will be income-restricted.

Lewiston’s Choice Neighborhoods initiative, in multiple phases, will feature 185 new units, 92 of which are replacing existing “distressed affordable units” and approximately 38 will be affordable units new to the market.

Raise-Op Housing Cooperative, a cooperative housing organization in Lewiston, is currently developing 18 units in two buildings on Blake and Walnut streets that will open in 2023. All the units are restricted to households at or below 60% of area median income.

Misty Parker, economic development manager in Lewiston, said the city also has a number of rehab projects in existing buildings funded through the Community Development Block Grant and lead abatement programs that require 51% of the units funded to be affordable for residents 80% or below area median income.

“The city continues to fund this program to help landlords improve their buildings and as a tool to support additional affordability in the city,” she said.

Lewiston Mayor Carl Sheline said this week that while the city has seen a number of new affordable housing units come online in recent years, “we ultimately need more construction.”

“In the meantime, we need to be innovative,” he said.

One of the few topics where Sheline has seen eye-to-eye with Auburn Mayor Jason Levesque has been support for state legislation taking effect next year, LD 2003, that seeks to encourage more housing options by rethinking zoning. He said city staff is already working to prepare for the changes, which among other things, will allow any property owner to build an accessory dwelling unit.

A NEW APPROACH

In Auburn, changes in zoning rules are part of the city’s two-pronged approach to the housing crisis, along with the development of more market-rate housing. But actively creating more affordable units is intentionally not part of its approach.

Between 2019 and 2022, there were 243 new affordable housing units created in Lewiston and Auburn. But in Auburn, the last units to come online, on Hampshire Street, were in 2020. For the last two years, all new unit construction in Auburn has been market rate housing and privately funded. Unlike Lewiston, Auburn doesn’t have any large-scale developments with affordable units in the works, which has been a conscious choice by city officials and staff.

According to city data, Auburn has 980 income-restricted “affordable” housing units, making up roughly 9% of the city’s 10,829 total units.

City staff said that meets what “most communities” have as a goal: to provide about 10% of housing units that are affordable. Eric Cousens, director of Planning and Permitting, compared Auburn’s numbers to Brunswick, which has 328 affordable units.

In Maine, 45% of renter households are at or below 50% of the area median income.

Instead of pursuing larger-scale affordable housing developments, Auburn officials have been looking at other means, including a current push to modernize zoning rules to encourage building rehabilitations and a larger variety of housing types.

A recent memo from Zakk Maher, Auburn’s deputy director of Business and Community Development, lays out the city’s position, which is also included in the city’s federal HOME action plan approved this week.

“The sustainable, and equitable answer is not large multi-unit developments of low income housing. This is not the 1980s. The answer is zoning improvements which add locally owned, operated and more importantly maintained units,” it states. “Concentrating low income housing is discriminatory and a non-starter for the city of Auburn. Instead we will continue to advocate for the development of not just additional units that will help alleviate the housing shortage, but also add much needed residual income for Auburn residents that have extra acreage to develop on their lot as this recession takes hold.”

Auburn Mayor Levesque, who has taken a very hands-on approach to much of the city’s zoning and housing policymaking, was in Atlanta last week. While attending a conference, he toured a new development of accessory dwelling units, or small homes.

Allowing ADU’s in all residential zones in Auburn has been a point of pride for city officials, especially leading up to the implementation of legislation that will allow ADU’s statewide.

The effort to encourage housing growth in Auburn began before LD 2003 was introduced, and has made Levesque a central figure — and sometime lightning rod — within the topic of zoning reform not just locally but statewide.

Levesque believes in an “all of the above” approach to new housing. With an increased supply of housing of all types, he believes it will keep Auburn affordable for the average family at a time when the gap is growing elsewhere.

“More market-rate supply frees up inventory at every level of housing,” he said. “That can help with overall costs even though the ones just built are more expensive.”

He also pointed to initiatives rolled out by Auburn Hall aimed at decreasing other housing costs, like Sustainable Auburn, which provides grants for homeowners to make their homes more energy efficient.

Levesque has used the term “attainable housing,” which seems to have caught on. John Gendron, who is amid a controversial effort to rezone land between Gracelawn Road and Lake Auburn, has also recently used the term while arguing his case for building several types of housing there.

When asked about the pushback that sometimes occurs when the term affordable or low-income housing is used, Levesque said it’s simply discriminatory. But he also says it goes both ways.

“I’ve heard we can’t have rich people in McMansions in Auburn, and we don’t want renters because renters are poor,” he said. “Can’t we just strive for housing?”

But, when asked if Auburn needs more affordable housing — in the income-restricted sense — Levesque said no.

“We need to let the market balance and provide housing that’s attainable regardless of income level,” he said.

He said Auburn is focusing on “the missing middle.” He said he often hears “the myth” that no one in Auburn can afford higher-priced housing and rentals. He’d also like to see more owner-occupied duplexes and three-unit buildings.

“There are lots of people in Auburn that can afford a variety of different priced homes, apartments and condos. We have to recognize it’s all part of the same mix,” he said.

‘EXTREMELY DIFFICULT SITUATION’

The shortage of affordable housing units in the state is so severe, state officials aren’t waiting for the market to balance. LD 2003, which Levesque supports for the zoning changes it encourages, also has a provision aimed at increasing housing for low-income households by making affordable housing projects a more attractive investment for developers.

The provision, which has been somewhat controversial, would allow affordable housing projects developed in designated growth areas to be built at a density 2.5 times greater than what’s allowed in the zone, making the investment more worthwhile to developers.

Greg Payne, senior advisor of housing policy for Gov. Janet Mills, defended the provision based on the need, saying affordable housing practitioners and MaineHousing have estimated a shortage of 25,000 affordable units based on various reports and data that have been released over time.

Data from the National Low Income Housing Coalition suggests that Maine is short 19,264 rental units just for extremely low-income households, which are defined as 30% of area median income and below.

“But of course that does not speak at all to the shortage of rental units for households at 31-80% of AMI or the shortage of affordable homes for purchase by first-time homebuyers,” Payne said.

Chris Kilmurry, director of Lewiston Housing, said there are about 900 people on a waiting list for Lewiston Housing properties. That’s separate from the more than 400 low-income Lewiston people who have a Section 8 housing voucher who are on a statewide waiting list of roughly 11,000.

“All in all, there is a lot of need in our area,” he said.

Across the river, Auburn Housing Authority Director Martin Szydlowski said the waiting list is roughly the same as last year: about 2,200.

But, like Lewiston, he said the availability of rental units for Section 8 voucher holders is another matter.

“There are not a lot of units out there,” he said.

Szydlowski said Auburn Housing Authority tracks available units in Auburn monthly by reviewing websites like Apartments.com, Zillow, Trulia and Craigslist, and eliminating duplicates.

A review on July 19 found 15 listed units in Auburn ranging from 1 to 4 bedrooms. For voucher holders, only two would be considered “affordable,” which means the amount the would-be tenant can pay, plus the amount the voucher can pay will equal the rent being requested.

Those numbers include a recent increase in the amount a voucher can contribute, after a federal increase was approved that allows housing authorities to increase payment standards to 120% of fair market rents. The ceiling was previously 110%.

“It remains an extremely difficult situation to find affordable housing,” he said.

Payne said LD 2003 includes a requirement that the Maine Department of Economic and Community Development establish statewide and regional housing goals.

“As part of the work to comply with that requirement, we anticipate that we will get updated and comprehensive data on the state’s rental and homeownership shortage,” he said.

THE MARKET, UNTOUCHED

The demand for housing in the area isn’t limited to affordable units, with evidence that a lack of housing has slowed growth and economic development. Jessica Klimek, the developer of the Stable Ridge apartments at 555 Court St. in Auburn, said she’s already getting a lot of inquiries for the units. The first two buildings are under construction now.

She said she’s talked to a number of renters who have seen prices skyrocket over the last year. They’ve told her the increases aren’t justified given the conditions of the apartments, and they’re already paying in the “mid- to upper-end of market rate.”

She believes new units in a desirable area can create “competition to set the market,” perhaps forcing landlords who have upped rent to either level off rent prices or make unit upgrades.

“New construction is costly,” she said. “But there are a lot of renters in the area paying what you wouldn’t believe.”

Klimek said the rents at Stable Ridge will depend on building location and other factors, but estimated that the one and two-bedroom rents will range between $1,650 to $1,800, which includes utilities.

She argues that by adding to the market-rate housing supply in the area, “those who maybe can’t afford Stable Ridge will have more options.”

There’s some evidence to that. Yet, some say that if left untouched, the market will simply continue to do what it’s been doing since 2020.

Andrew Aurand, vice president for research at the National Low Income Housing Coalition, said last week that increasing the supply of market-rate housing is important. He said the increase can help lower rent prices, “especially in the upper and middle segments of the rental market.”

But, at the same time, he said, “we still need to give attention to the supply of affordable rental housing that would be affordable to renters with extremely low incomes.”

“The rents that extremely low-income renters can afford to pay often don’t cover the operating costs of maintaining good-quality housing, so the market isn’t going to serve them,” he said. “Rents in the private market simply won’t go low enough to provide an adequate supply of housing for extremely low-income renters.”

He believes nationwide, the government needs to increase financial support for rental housing that would be affordable to extremely low-income renters, and along with production, increase the budget for vouchers to help extremely low-income renters afford housing in the private market.

Craig Saddlemire, who with Raise-Op in Lewiston is developing new affordable units, said Maine “absolutely” needs more housing supply, but said more housing of any kind does not necessarily lower market rate housing costs. He believes that “in many cases the creation of new housing creates upward pressure on market rates.”

“The problem is not only supply, but the way in which speculators and wealthy homeowners continue to capture more and more homes,” he said. “Getting affordable homes to the people who really need them takes a lot more intervention than simply increasing supply, unfortunately.”

Saddlemire, who also co-chaired the recent ad hoc shelter committee process in Lewiston, believes the true housing crisis to be those living in unsafe or unaffordable housing who are on the brink of homelessness.

“There are other people who want to upsize, move to a hip place, buy a second or third home, or convert homes to tourist lodging, and they might be finding as many housing options as they would like,” he said. “Housing demand at every level is outpacing supply by such a large measure that low-income households really need housing built and reserved for them first, otherwise the market will continue to serve the highest bidder and ignore the needs of the people who are suffering the most.”

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