Committee backs increasing Maine Housing bond cap to support housing production
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Summary
LD 2127 would raise the cap on certain Maine State Housing Authority bonds from $3 billion to $4 billion; Maine Housing testified that its reserve funds and stress tests support the change and disputed claims that its bonds are direct state liabilities. The committee voted unanimously among those present to report "ought to pass."
Augusta, Maine — The committee unanimously recommended LD 2127 "ought to pass," a bill to raise the cap on certain Maine State Housing Authority mortgage-purchase and revenue bonds from $3 billion to $4 billion to reflect current housing production needs.
Agency representatives from Maine Housing detailed existing statutory authorities, reserve-fund requirements and oversight. Adam Craig, director of finance and lending, said Maine Housing currently meets reserve requirements and maintains a buffer between assets and liabilities. "The balance of the reserve fund is currently $248,000,000," Craig told the committee, and the authority has additional asset buffers to meet stress tests.
Maine Housing also responded to testimony from the Maine Policy Institute that characterized the authority's bonds as government-backed liabilities; agency staff said those claims were inaccurate and reiterated that Maine Housing's bonds are not direct obligations of the state. "Our bonds... are not direct state liabilities," the agency said, adding the state is under no legal obligation to pay them back.
Agency staff described routine stress tests, delinquency and foreclosure statistics that show the authority manages credit risk and has capacity to continue lending. Staff argued the cap increase is needed to avoid hampering housing production under current market conditions.
After caucus the committee voted and recorded a unanimous recommendation among those present that LD 2127 "ought to pass." The committee also noted an upcoming Maine Housing update scheduled for Thursday and distributed the authority's annual report to members.
What's next: If the bill advances, Maine Housing would use the increased cap to expand bonding for construction and mortgage programs consistent with statutory guardrails; committee staff will track the agency update and distribute materials requested by members.
