2018-02-02 / Front Page

Port gets housing ammo

By Duke Harrington Staff Writer

KENNEBUNKPORT — The tough nut of affordable housing has not yet been cracked in Kennebunkport, but selectmen may have finally found the hammer with which to do it.

At its most recent meeting on Jan. 25, the board of selectmen accepted a 69- page “Housing Needs Analysis and Assessment” report prepared by Camoin Associates of Saratoga Springs, New York. Commissioned at a cost of $22,040, the report lays out the problems with housing in Kennebunkport, lays out some goals and provides tools the town can use going forward to get there.

However, the town may not follow precisely the models provided in the reports overview of its case studies on the topic.

“We now have the data. We know how Mount Desert Island performs, and Scarborough, and so forth, but we are going to have to come up with ‘the Kennebunk- port solution.’ So, the strategy, if you will, is yet to come,” said Patrick Briggs, chairman of the board of selectmen.

But while the plan lays out a road map, the question remains, who will use it to drive Kennebunkport where it needs to go?

“I would hope that this is a report that would not sit on the shelf, but that the board will make this a priority,” Town Manager Laurie Smith said. “I would tell you that, by far, affordable housing and this idea of how we not just open up development but attack this particular issue and sustain Kennebunkport Consolidated School is, by far, leaps and bounds, the No. 1 issue reported to me by citizens.”

“What I am hearing is an active interest in how do we proceed going forward,” Briggs said. “I think it’s important to let everyone know, we are not in competition with developers. And are not changing how the town is going to develop. It’s not going to become overgrown. It’s not going to go crazy.”

Managing growth and making sure those who work in Kennebunkport can afford to live there, will require the town to develop and implement some strategies, methods of attack that could include anything from implementing impact fees on development, to establishing tax increment financing districts and mandates that a certain percentage of future construction in town be reserved at prices affordable to those earning 80 to 120 percent of the area median income.

According to Camoin Project Manager Tom Dworetsky, recent trends predict that 230 new housing units will be build in Kennebunkport over the coming decade. Whatever strategies are developed, the overall goal, he said, should be to assure that at least 10 percent of that new housing stock be targeted for affordable housing projects.

“That’s a minimum. That’s very modest,” Dworetsky said.

The problem, said Camoin Principal Jim Damicis, who lives in Sacrborough, is that since 2000 the median home in Kennebunkport has gone up 102 percent, while household incomes have risen over that same time period just 32 percent. That median priced home, he said, is now beyond the reach of any household bringing in less than $95,000 per year. And yet, 33 percent of Kennebunkport households make less than $50,000, while 4 percent are currently listed as living below the federal poverty line

“If left to its own, this problem will not solve itself,” Damicis said. “The market solves lots of problems, and when the market is solving problems, let the market do that. But clearly, it’s not doing that here. It’s not doing along the coast of Maine and in other communities here. So, some sort of policy is needed in order to have a different future. You no doubt do not want to be in the housing business as a town, so some sort of public/private partnership makes sense.”

Camoin spent more than three months drafting its report, compiling data, interviewing various civic and community leaders, conducting a survey of 50 local business owners, and conducting in cooperation with the town’s growth planning committee two public hearings, on Oct. 5, and Nov. 6.

From all of that, Damicis said, one thing became clear — something most town leader already knew, or at least suspected when they commissioned the study.

“People really want to live here, but the pricing is just not in their wheelhouse,” he said. “That was confirmed in many different interviews, as well as by people in the real estate profession here as well.”

According to the study, the median home value in Kennebunkport is $473,718. That compares to $251,150 for all of York County. And while a median household income of $95,280 is required to finance that kind of property, the current median income in town is just $71,834.

The median price for a developable lot in town is $270,000 — meaning that most potential new homes start out beyond the reach of many potential buyers before the first stick of framing is nailed in place.

“In order to get a reasonable return, developers must create very expensive housing,” Damicis said.

Partly as a result of that ever escalating home price, 44 percent all housing units in town are owned by people who do not call Kennebunkport their primary residence. Seventeen percent of all local home owners vote in Massachusetts.

“There is a real fear that the town is becoming exclusively seasonal,” Damicis said.

But a seasonal population requires a seasonal workforce to support it, as does the seasonal ebb and flow of the town’s tourist economy. And yet, demand drives up the price of rents as well, as scarcity takes hold.

Just 19 percent of Kennebunkport’s “permanently occupied housing units” are rentals, Damicis said. That compares to 29 percent across all of York County, and 31 percent statewide. Meanwhile, the already low rental stock is increasingly diverted to to short-term vacations rentals.

“A property owner can make more in one month at peak season on short-term rentals that on an entire year on a home rented out year-round,” Damicis said.

The upshot is that just a quarter of the people who live in Kennebunkport year-round work in town. And that also is a problem, when it comes to retaining the community feel of the ol’ neighborhood.

“When you have lots of people commuting long distances because they simply cannot afford to live in community where they work, that’s what you want to avoid,” Damicis said. “In a small community like Kennebunkport, that’s critical because you do so many things though the volunteerism of residents.”

Meanwhile, 11 of 47 full-time municipal employees in town will reach retirement age within the next five years. With the cost of living so high in town, finding quality workers to replace those slated for retirement could become an increasing challenge.

“As town employees age, their replacements will not be available in or near town because of the housing costs,” Damicis said.

So, what are the solutions? Well, the good news is that Kennebunkport does not have a shortage of places it can build new homes.

According to Dworetsky, land already existing and open for potential development in town could support 2,800 units under current zoning regulations.

“We’re not here tonight to call for 2,800 units, that’s just to show the potential order of magnitude that is available,” Damicis said.

Still, that’s potential is important. In September 2016, town officials asked the Workforce Housing Coalition of the Greater Seacoast — a nonprofit based in Dover, New Hampshire — to conduct a public workshop on local housing needs. The coalition brought in more than 20 designers, planners, architects, engineers, real estate agents, developers, bankers and construction estimators, along with interested local residents to study the issue. Together, the group toured two local sites, including one adjacent to Kennebunkport Consolidated School, and brainstorm ways to create homes in town the average local worker could actually afford to buy.

What that group concluded was that only if the town were to create a so-called “density bonus” amendment to its zoning rules, allowing for 80 units at 1,500-square-feet, each, on the 8.1- acre site near KCS, could selling price be brought down to the $267,375 thought to be within the buying range of the median income in town.

And, even with a density bonus allowing for 56 units, the price for each unit on the larger 10-acre rural site considered was estimated to come in no lower than $370,000, owing to the need to build well and septic systems for each building, as well as costs to bring in utilities and the longer roads required to access the property.

Only by increasing the number of allowed units there to 94, or by subsidizing the project with federal tax credits, could costs be lowered to meet the affordability target of less than $275,000 per unit, the group concluded.

By all accounts, that 2016 project did not go over well with local residents, largely because of an impression the town was targeting the examined lots, one of which the town now owns, for development. There has been much concern about residents that there are not enough children in town to sustain KCS over the long haul. Currently, the school has just one kindergarten class. However, there also was a distinct distaste for creating any sort of housing development next to the school

The Camoin report avoids using any local lots as an example of what might be accomplished in town, turning instead to case studies of similar towns in and out of Maine, for clues on how to bring at least 10 percent of future home construction in Kennebunkport to market in the $254,00 to $382,000 price range — the figures calculated to be within 80 to120 percent of the town’s median income, based on 2016 data.

Suggestions include:

 Creating a local housing alliance or housing trust, such is the one established in Scarborough, to keep the town’s eye on the ball,

 Donate town-own land to developer or hosing entity, or convincing local landowners to do the same, in order to drive down development costs affecting the final price tag of new homes built there,

 Adjusting zoning policy to allow for clustering or homes, or to provide a “density bonus” that will increase development potential of a given site relative to land costs,

 Establishing an tax increment financing district (TIF) for affordable housing, allowing the town to dedicate future property tax revenue from any affordable housing development to help developers pay for the costs of building the homes, and to pay for town infrastructure costs needed to support the new residents, and,

 Partner with a housing developer to assure the creation of affordable housing units, be it Avesta Housing, as South Portland has done, or Habitat for Humanity, as in Scarborough, or some other entity.

Whichever course the town chooses, it will likely include traveling down multiple paths at once.

“Like most things, we are going to have to approach this in a multi-legged way, so that we are attacking it from different areas,” Smith said.

But for now, while the Camoin report has not been put on a shelf, it has been placed in Smith’s lap, to decide the next steps.

“This is not something we can decide here tonight,” Briggs said. “I’d like to ask [Town Manager] Laurie [Smith] and the members of the town committees to come back to us with a playbook.”

“The document is a great foundation for educating us all on the challenge and issue at hand,” Smith said in an email prior to the meeting, that was somewhat prescient of the unanimous charge given to her by selectmen.

“Now we need a public discussion on where we go from here,” she said.

Staff Writer Duke Harrington can be reached at news@kennebunkpost.com.

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