There’s still room for improvement on Speaker Fecteau’s affordable housing bill
Last Monday, Speaker of the Maine House of Representatives Ryan Fecteau unveiled a significant amendment to LD 2003, the prime vehicle for several reforms recommended by the Maine Legislature’s Commission To Increase Housing Opportunities in Maine by Studying Zoning and Land Use Restrictions, which met through last year to deduce the causes of high housing prices and the lack of affordable supply in Maine today.
Speaker Fecteau chaired the zoning commission and has made housing his number one policy priority for this session. Fecteau is the primary sponsor of LD 2003, with others such as Sen. Craig Hickman and Rep. Amy Arata, who also served on the commission. In its final report, the commission recognized that restrictive local zoning was the main driver of the slow growth of the state’s housing stock, in addition to pandemic demand that had driven rents and housing prices ever higher.
Overall, Fecteau’s amendment softens and cleans up the bill by removing some potentially problematic provisions from the original language, but retains several points of contention that representatives from the Maine Municipal Association (MMA), a group that advocates for the interests of local governments at the state level, pointed out in their initial public testimony against the bill.
Maine Policy Institute testified “neither for nor against” LD 2003 at the hearing, offering several changes needed to secure support. To foster a more cooperative relationship between the state and municipal governments, we proposed expanding and targeting incentives for pro-growth ordinance adoption rather than using the blunt object of state mandates. We also pointed out that the problematic language to expand the definition of “unfair housing discrimination” under the Maine Human Rights Act would expose many municipalities to costly litigation. Speaker Fecteau also made the latter point when explaining why that provision was removed in his amended version of the bill.
The amendment signals that the Speaker heard much of the criticism offered at the hearing, which earned an “Ought To Pass” recommendation by an 8-3 vote of the Legislature’s Committee on Labor and Housing last Wednesday, though it still leans heavily on broad municipal ordinance mandates as the main mechanism of action.
The fundamental push-and-pull of the housing debate centers on the appropriate balance between the state’s duty to protect the liberty and property rights of citizens and the concept of “home rule,” also referred to as “local control.” Without entering the rabbit hole of state court precedent related to this question, beyond simply a constitutional directive, “home rule” is an ethos. The tradition of deference to local-level municipal governance is long-standing, and in many cases, as old as the Maine and New England communities in which it is used.
If passed, LD 2003 would require towns to adopt ordinances allowing owners of residential zone lots (outside of a subdivision) to build up to four total dwelling units, including “accessory dwelling units” (ADUs) like tiny homes or in-law apartments, on their property. The Speaker struck the prohibition of local residential growth caps, but specified that such ADUs would not count toward a municipality’s growth cap in his amendment.
The MMA took issue with these aspects of the bill, as well as mandatory “priority development zones,” which were also struck in the amended bill. Much of the public comment related to that provision centered around the possibility of limiting the priority development zone provision to Maine’s larger towns and cities. In the end, Speaker Fecteau removed it entirely from the bill.
A proposed state-level review board, which could override local decision-making on housing developments, was struck from Fecteau’s bil as well. A similar idea was put forth by Representative Rachel Talbot-Ross in LD 1673, but she recently amended the bill and removed the permit review board, effectively killing the idea in this Legislature.
Speaker Fecteau’s amendment also struck what’s known as an “emergency enactor,” which would have enabled the bill to become law immediately upon the governor’s signature instead of 90 days after the Legislature’s adjournment, but the provision would have required the bill to earn a two-thirds vote in both the House and Senate. Removing it means that legislative Democrats would be able to pass LD 2003 without any Republican votes.
Since the bill specifies that its local requirements would not take effect until next year, the emergency enactor preamble is unnecessary. Though, removing the emergency enactor may have more to do with avoiding a potential constitutional conflict, if not politics, rather than convenience.
Article IV, Part Third, Section 16 of the Maine Constitution states that “An emergency bill shall include only such measures as are immediately necessary for the preservation of the public peace, health or safety; and shall not include…an infringement of the right of home rule for municipalities,” though the provision on “Municipal Home Rule” in Article VIII, Part Second, added to the state constitution by voters in 1969, only addresses the “power of municipalities to amend their charters” and the “construction of buildings for industrial use.” It is possible that by removing the emergency language, the bill may have avoided the heartburn of judicial scrutiny.
Arguably, the most troubling aspect of the amended bill is a new section offered in the amendment which requires municipalities to play a part in achieving “statewide or regional housing goals” by ensuring that zoning ordinances “are designed to affirmatively further the purposes of the federal Fair Housing Act.” The bill directs Maine Department of Economic and Community Development (DECD), in coordination with Maine Housing Authority, to develop goals and rules for implementation. The reference to federal policy is worrisome because it could mean that the federal Department of Housing and Urban Development (HUD) would hand down these goals to the state, further separating housing policy from local communities.
Tim Reiniger, a lawyer and member of the Cape Elizabeth Town Council, is opposed to the bill, in part because of how it would inject federal housing policy directly into the workings of local towns, exposing them to unneeded scrutiny from the federal government by way of the state. Mr. Reiniger expounded on this idea in email:
“By expressly requiring municipalities to implement the “Affirmatively Furthering Fair Housing” Rule of the federal Fair Housing Act (also known as the requirement to AFFH), LD 2003, as amended, would represent the largest unfunded social engineering mandate ever imposed by the Maine state government on the local municipalities. This will cripple the economic sustainability of Maine local communities as well as current property taxpayers, who will experience spiking tax bills.”
Reiniger suggests the adoption of this policy would result in unmanageable growth and ballooning costs at the local level where greater investment would be needed to obtain adequate community services to meet federal housing goals, well beyond what most municipalities can currently afford.
The new section also explicitly allows for local regulation of short-term rentals (STRs) like AirBnb, in order to achieve federal housing goals. Sponsors say that this bill empowers individual property owners, but this smacks of hypocrisy when the initial language banned rentals of ADUs less than 30 days. Thankfully, this provision does not appear in the amended version, but the new section opens the door to all methods of local scrutiny of individual property owners. Sponsors say that property owners will have more freedom under this bill, yet seek to allow towns to tell individuals how they may rent their own units.
If any mandate on municipalities is warranted on the basis of defending property rights, it is to prohibit undue regulation of short-term rental properties which an owner should be able to freely choose to offer instead of long-term, month-to-month rentals. Maine Policy Institute still cannot support LD 2003 with the inclusion of this new section.
It may be seen as a necessary evil to force municipalities to shoe-horn various ordinances onto their books, but perhaps these mandates are not prudent for every town in Maine to adopt over the next two years. One can certainly envision a situation in which overriding existing local residential zoning would not be in that community’s best interest.
Exempt small towns in Maine from the bill’s ordinance requirements for the sake of argument. A compromise like this might go a long way toward building true consensus around passage. It may also cool the adversarial stance by various local-level officials and the subsequent opposition from the MMA. Speaker Fecteau has shown in his amendment that he seeks as broad support as possible; this kind of provision would more fully achieve it over the current version of the bill.
Would constantly yielding to local decision-making inevitably lead to a lower rate of growth in local housing stock, for better or for worse? No doubt that proponents of LD 2003 believe that it would; it is the gamble they are taking with one-size-fits-all municipal mandates.
Many local governing bodies in Maine—whether they be planning boards, select boards or voters—continue to reject growth and development of their communities despite the long-term consequences for economic growth.
No matter how much muscle state leaders flex, the much-needed housing supply increase over the next 10 years in southern Maine will barely materialize. Housing is a function of economic health, and with our locally-driven politics, no solution will stick without a culture of growth at the local level.