Field Notes: Housing policies on an island scale

The building I am looking at on Vinalhaven is a nondescript, large two-story structure that used to function as an island store. Having just arrived after a quick walk up the hill from "down street," I am a stones' throw from the historical society, the Arts and Recreation Center and its Cafe, and beyond I can see the recently restored town offices and Carvers Pond. It would be a good place to rent an apartment for a young family who needs to be close to everything.

The place I describe is the future site of Hillside Apartments, a six-unit low to medium income rental housing development that represents the culmination of a discussion that began on Vinalhaven in 1988. Back then, residents were faced with 20 percent increases in their house values. Fixed income residents were having a hard time holding on to their homes because of increased real estate tax pressures. Increasing real estate values also meant that few homes were within reach of young families looking to get started on the island.

Today the average family income on an island can only afford one half of the average house price. Working residents, people who often have a good jobs sterning on a lobster boat or teaching in the school are increasingly unable to save up to buy an island home. This trend threatens the long-term sustainability of all of Maine's year-round island communities.

Identifying the need is one thing. Finding ways to meet this need are quite another. Community Housing of Maine, working through its Development Director Erin Cooperider, has been struggling to pull together the financing for an effort that, through the Hillside Apartment initiative, would add six units of two and three bedroom rental housing on Vinalhaven. After years of fundraising through local and federal sources she is still nearly $150,000 short of the $1.35 million needed to complete the effort.

To put this in perspective, you can think of the $150,000 as the cost difference between doing a project like this on the mainland compared to on an island; materials cost more, labor costs more. This "funding gap" is often what stops a housing program from moving forward in island communities.

Recognizing this issue, the Island Institute has been working with Genesis Community Loan Fund and Coastal Enterprises Inc. for the past five years to figure out a long-term strategy to fill this gap. After a series of housing conferences and research into the issue, three years ago The Genesis Fund established the Island Challenge Fund, raising $250,000 to assist island housing groups through providing grants of up to 25,000 to fill the gap (nearly every island has its own housing nonprofit). The Island Institute added the Affordable Coast Fund to the mix of funding sources shortly after, bringing another $125,000 to the table.

However, philanthropic individuals can only sustain support like this for one or two years at best-they like to catalyze solutions but can't be relied on forever. We knew that if we could demonstrate the need and a solution that we might have a chance at working with the Maine State Housing Authority to codify a program that formally recognized that housing needs on unbridged islands were unique and required unique solutions.  

At first, we created an island housing coalition but this appeared too narrow of an interest to legislators when housing, after all, is a statewide issue with many different interest groups. It quickly became clear that doing something for the islands would require doing something for the state.

As a result, our organizations joined forces with the Southern Maine Rental Housing Coalition. Together these coalitions and others evolved into the Maine Affordable Housing Coalition.

We set an audacious goal given the economic climate of fall 2008: bonding 30 million for housing for the state of Maine. However, we asked for something everyone could understand: construction jobs, more efficient homes, and affordable housing where people work, not 60 miles from where they work. These ideas resonated and we were successful when the bill was signed by Gov. John Baldacci last June.

The islands would benefit because the bill that passed stated that up to 30 percent of the fund-$9 million-would be allocated without income restrictions and without restrictions on the minimum number of units that would have to be built in any given project (most housing funds require using national low income guidelines). Because islands were represented in this coalition, and because of our coastal leaders on both sides of the isle, led by Speaker of the House Hannah Pingree, we were able to put the framework in place for a large-scale effort to fund island housing needs.

The need is great. The Genesis Fund anticipates that within the next two years island housing groups have roughly 50 units of housing in the pipeline with gap funding needs that range from $20,000 to $400,000. The work that would be required to construct or renovate these units would support roughly 200 jobs on the islands over this period. Thankfully, the Maine State Housing Authority has reached out to island housing groups and shown significant interest in the issue of providing gap funding. They understand that a new program would be needed, modeled on the Island Challenge Fund and the Affordable Coast Fund.

There is still a great deal to be done if we are to put these bond funds to work on the islands, but with persistence and focus, we may have something in place as soon as July 2010. The issue is as critical today as when the Vinalhaven Affordable Housing Committee began debating what to do back in 1988. Perhaps these funds can even fill the $150,000 gap that has held up this effort over the past year.

Rob Snyder is the vice-president of programs at the Island Institute.