Council approves Martel School Apartments TIF credit agreements to support 88 affordable senior units

The Lewiston City Council adopted two credit enhancement agreements supporting the Martel School Apartments omnibus affordable housing tax-increment financing (TIF) district, approving phase 1 and phase 2 by recorded votes of 7-0. The agreements provide reimbursement to the developer of 75 percent of new property taxes over multi-year schedules to help close financing gaps for a senior affordable housing development at Lisbon Street and East Avenue.

Why it matters: Council and staff said the TIFs will help the Lewiston Housing Authority and its development partners close financing gaps for senior housing targeted to residents at or below 50 percent of area median income (AMI). Councilors were briefed on the project pipeline and how the city uses TIFs to shelter new valuation from certain state aid calculations.

The development: Director Nate Libby, director of Economic and Community Development, presented an overview of a housing pipeline of approximately 1,429 units citywide and then focused on Martel School Apartments. Phase 1 is proposed as 44 one-bedroom rental units restricted to seniors at 50 percent AMI, with construction expected to begin in 2025 and complete by 2027. The development cost shown in staff materials for phase 1 was about $16.59 million; the developer requested a 75 percent reimbursement of new property tax increment over 16 years, which staff estimated would reimburse roughly $640,000 to phase 1. Phase 2 is a similar 44-unit senior building; phase 2 was presented as eligible for a separate 75 percent reimbursement over 17 years.

Developer and timing: Penn Lindsay, director of development for the Lewiston Housing Authority, told the council the authority’s waiting list includes about 1,100 households; 65 percent of those households are seeking one-bedroom units and roughly 300 on the list are seniors. Penn Lindsay said the authority hopes to break ground in the fall.

Council questions and answers: Councilor Gallant and others asked how income eligibility would work; Libby explained that utilities and income calculations mean many seniors on Social Security would fall under the 50 percent AMI cap, and that rents for residents using project-based vouchers are keyed to 30 percent of tenant income. Councilor Chatham pressed the assessor valuation used for the TIF baseline; staff explained that the assessor’s office reported the underlying parcel was on the city’s tax-exempt roll at the last commitment date but that the limited partnership created to own the new development will be structured as a taxable entity and would pay property taxes as stipulated in the credit enhancement agreements.

Action taken: The council adopted the order approving the Martel School Apartments omnibus TIF district and the phase 1 credit enhancement agreement (motion by Councilor Kiran, second by Councilor Nagine) by a 7-0 vote. The council then adopted the phase 2 credit enhancement agreement by a 7-0 vote. Staff was authorized to execute the agreements and submit required applications to MaineHousing.

Next steps: Staff and the Lewiston Housing Authority expect to move toward financing closings and a fall groundbreaking if financing and closing conditions are met. The city will monitor project milestones tied to the credit enhancement agreements and report back through normal budget and project reporting channels.