Committee backs FY2025 housing program budget, trust fund plan and updated TIF/application rules

The City of Portland Housing and Economic Development Committee voted unanimously to recommend that the City Council adopt multiple housing actions for fiscal 2025: the housing program budget, the 2025 housing trust fund annual plan and policy goals, and the issuance of the 2025 affordable housing development and tax increment financing (TIF) application.

Nut graf: Staff presented a budget that assumes level funding for federal HOME, CDBG and ESG formula grants and detailed a mix of funding sources for local housing programs. The committee also discussed maintaining a $500,000 minimum balance in the Jill C. Dusan Housing Trust Fund and approved guidance for application priorities and procedural changes to the city's affordable‑housing TIF application process.

The budget and program overview were presented by Mary Davis, who said the city participates in the Cumberland County HOME Consortium and "the city and the county combined have received over 27,000,000 or almost $27,000,000 in HOME funding that has been used to do a variety of different housing related activities." The FY2025 draft budget assumes level funding pending HUD formula allocations and preserves a 10% administrative set‑aside for HOME program administration. Davis also explained program income expectations: "we are, anticipating receiving, just a little under $23,000 in lead safe housing program income," and staff has a recently awarded lead hazard removal grant of "just a little over 2,600,000" plus about $750,000 for code and life‑safety improvements.

Victoria Valente, housing program manager, described policy priorities: HOME funds prioritize very low income households ("Very low meaning at or below 50% AMI," Valente said); the housing trust fund follows local code (land use code section 17.3) and is intended to fill gaps, for example financing "missing middle" or workforce housing up to 80% AMI; and the affordable‑housing TIF is prioritized for LIHTC projects or units affordable up to 80% AMI with a preference for 50% AMI.

Committee debate focused on how much of the housing trust fund to keep in reserve. Staff said the fund currently has about $863,000 available; maintaining a $500,000 minimum would leave $363,558 available for new development awards. Committee members discussed tradeoffs between holding a reserve for emergency gap‑filling and releasing more funds immediately for projects. One councilor suggested a midpoint ($250,000) as an option for the minimum reserve; several members ultimately said they were comfortable keeping the $500,000 minimum with the understanding staff and council can authorize use of the reserve if needed.

On application process changes, staff proposed that projects requesting HOME or housing trust dollars provide planning board approval and MaineHousing "notice to proceed" before final application submission; applicants would be notified if their application is incomplete and would be responsible for reimbursing the city for legal and underwriting fees associated with housing trust fund and affordable‑housing TIF requests. Director Greg Watson said the intent is to bring better‑formed deals to the city so staff time and city resources are applied to projects closer to construction financing.

Actions: The committee moved and approved recommendations to the City Council on the FY2025 housing program budget; the 2025 housing policies and goals; the Jill C. Dusan Housing Trust Fund 2025 annual plan (including the decision to maintain a $500,000 minimum balance with committee/council authority to use the reserve); and the issuance of the 2025 affordable housing development and TIF application with the described process changes. Votes were unanimous among members present.

Ending: Staff said the committee's recommendations will be packaged for council public hearings in April and May, and that final HUD allocations, MaineHousing approvals and other funder decisions could still change project financing. Staff also said they will return to the committee if applications exceed the budgeted availability and to request use of reserves if justified.