Portland committee hears inclusionary zoning panel, advances Nordic spa land sale

[0:00] Pious Ali: This can join us. [0:04] Lori Paulette: Okay, the webinar started. Okay. [0:13] Pious Ali: Hello, everyone. This is City of Portland's Housing and Economic Development Committee. My name is Pius Ali. I am the chair of this committee and a member of the council. I am traveling with very sparse internet. If my internet goes away, way, I think committee members will decide on one of our colleagues to take over the meeting. I'm going to pass it on for committee members to introduce themselves. I think we have two or three colleagues of ours from the council for them to also introduce themselves, and then staff will follow suit. All right, committee members, over to you. [0:59] Regina Phillips: Good evening. This is Regina Phillips. I represent District 5. i mean district five oh my god i don't know where that came from i represent district three sorry about that counselor sykes hi it's counselor sykes i represent district three [1:12] Lori Paulette: i mean kind of district five council mcnavich i don't know who i am anymore district one there [1:21] Regina Phillips: We go. Good. [1:25] Laura Mitchell: Evening. I'm not a member of the committee, but I'm very interested in this agenda. [1:28] Anna Bullett: tonight my name is anna bullet and i represent district four thanks for letting me crash [1:35] Mark Dion: Mayor Dion, I'm here just to hear what's going to be said this evening. I think it'll be very helpful. Thank you, folks. [1:48] Benjamin Grant: This is Counselor Ben Grant, at-large member of the council. I'm not on this committee. I'm on my commute right now, so I'm just going to remain on mute and without. [1:58] Wesley Pelletier: my screen showing so you guys can carry on district two similarly computing commuting I'll [2:21] Michael Goldman: Jump in. Michael Goldman, Corporation Council. Pass it on to Pat. You're muted, Pat, and your mic isn't working. [2:40] Wesley Pelletier: I'll step in while Pat works on that. Kevin Kraft, Director of Planning and Urban Development. I'll pass it to Nancy Martin. [2:55] Anna Bullett: Nancy, you're muted. Yes, I am. This is a contagious affliction. Hopefully you can hear me now. Nancy Martin, business programs manager. I will hand it off to Heidi McCarthy. [3:11] Heidi McCarthy: Heidi McCarthy, housing program manager. I'll hand it off to Mary. [3:18] Mary Davis: Mary Davis, housing and community development division director. And it looks like we might be having some additional technical issues. Issues, so working behind the scenes to try and solve that. [3:33] Lori Paulette: Yes, Lori Paulette in Housing and Economic Development, and we are having some issues. Kayla Gonzalez is checking it out right now as well. No attendees are here, and there should be some here. [3:48] Pious Ali: Okay, thank you. All right, so if no attendees are here, is it because they cannot log in? [4:03] Mary Davis: Yes, it appears that the link is not working right, but we're trying to fix that. [4:12] Pious Ali: Okay. So I'm going to ask for the approval of the minutes, and then I will skip item number two for several reasons. One is that the panel members may not be able to join. And also we know that there are other stakeholders who may be attending to be there as listeners so that everybody is on the same page. So may I have the corporation counselor? [4:48] Michael Goldman: If I'm understanding correctly, thank you, counselor. Right now we don't have any public access, so I think we need to sort that out before, because it is a public meeting, sort that out before we move on to any of the items on the agenda. I think so far everybody's just introduced themselves. But, oh, it looks like attendees are popping in now. So maybe the link is now working. [5:18] Pious Ali: Okay. Let's hold on until they finish, and then we can go from there. Yeah. Yeah, we have two. Mayor, how was the meeting last night? [6:21] Mark Dion: Well, it's never the same if you're not there. How's that? That's good. No, I think it was a very good meeting. We moved through the items rather quickly. There was a lot of consensus on most of the issues presented. But we always miss when you're not there, you know? I know. I mean when my mere pro tem is off somewhere in the universe it's difficult [6:54] Pious Ali: I know and it's also easily to be noticed when I'm not there [6:58] Mark Dion: oh we notice don't worry we notice [Wesley Pelletier: I just] can't keep track of what city you're in so I can't report out to the rest of the public [7:12] Pious Ali: yeah that is even better before I receive an email that I was hired to be there every week and I'm globe trotting [7:22] Mark Dion: no i your globe is not as big as people think it is yeah but you're here tonight and that really was what i was most concerned about because we didn't discuss it i think this discussion tonight is probably superior to the one we had to have last night i know i know it [7:43] Pious Ali: takes special regina covered you though counselor phillips covered you i always trust my sister i was gonna [7:51] Regina Phillips: I was going to say, I got your back, brother. [7:53] Pious Ali: Hey, I know that. She does. [7:58] Mark Dion: Heaven forbid I tried to trespass there. [8:02] Regina Phillips: I wouldn't be pretty, Mayor. I would not be pretty. I know. [8:06] Mark Dion: I've learned something in these few years. Trust me. [8:16] Pious Ali: We have five attendees. I know that this meeting will have more than five attendees. [8:21] Regina Phillips: So let's do it. And did we ever find Nell? I don't think she's on, right? [8:27] Lori Paulette: I think she'll be coming on soon. Okay. [8:49] Mark Dion: Well, Pat, welcome to Portland, where most of our work happens exactly after 5 o'clock in the afternoon. You're mute, so I can't hear your response. But we do have Mary here tonight. Counselor Ali would not move without you, Mary. Just know that. [9:24] Pious Ali: Mary is the one that makes things happen on this county. [9:30] Regina Phillips: No one moves without Mary or Kevin. [9:33] Mary Davis: You guys are giving me way too much credit. The behind-the-scenes folks, Glory and Kayla and Heidi, those are the guys who keep us all in line. [9:45] Mark Dion: Mary, we know that, but we need you there. Bias needs you there. Kevin's helpful. [9:51] Mary Davis: It looks like the attendees are getting into the meeting now, and we do have the panelists for the inclusionary zoning discussion. In the attendees. So, if we wanted to start, we could do that. [10:09] Pious Ali: Okay. So, Councillor Sykes, I've seen that you've joined us. Do you want to introduce yourself for those who don't know you? [10:25] Heidi McCarthy: Sorry, Councillor Ali, I already introduced myself. [10:29] Pious Ali: Oh, you did? Okay. Councillor Sykes, District 5, hello. Oh, yeah, I remember. [10:36] Mark Dion: She tried to be District 3, but she's 5. She's 5, yeah. So, [10:40] Pious Ali: So I think now that we are up and running, may I have a motion and a second to approve the minutes from the September 15 meeting? So moved. Second. Moved by Councillor Phillips, second by Councillor McNewish. Is there any committee members comment or any suggestion for amendment or anything? See then I'm going to call the roll. Councillor Phillips? Yes. Councillor Sykes? Yes. Councillor Mitchinways? Yes. And I am a yes. The next item on the agenda is a discussion regarding the inclusionary zoning and I want to make a personal statement that I think some members of the collaborators or stakeholders on this item were not invited and that is on me. So I am sorry. We are going to have four individuals who will be on the panel today and then we will give equal amount of time to other stakeholders who were not invited to this session in the following meeting. We're gonna have two more meetings on, this item will be on the agenda. And then we will discuss it after we've heard from everyone and move it forward to the planning board and subsequently to the city council. This has been, we've had another discussion on this a few months ago and it went to the council and then it came back here. But before I let staff invite the members of the panel, I want to ask committee members if anybody have any questions or any remarks to add to what I've already said. [12:59] Heidi McCarthy: Councillor Sykes. Thank you, Councillor Ali. I do appreciate that we're going to correct course on this and make sure that we have every person that is involved in this and is a stakeholder. I think it's really critical that we hear from the main Democratic Socialists of America, who were the people that wrote and put forward the Citizens Referendum, under which our inclusionary zoning was increased. And I think it's also important to hear from experts in the field. I think, you know, there are thousands of municipalities across the United States that have inclusionary zoning. Zoning. And we just need to make sure that we are studying this completely and hearing from folks that are doing this well. My understanding is that, you know, five years ago, the citizens of Portland overwhelmingly said they wanted to increase the amount of inclusionary zoning. And so we need to take that as a community value and make sure that we hear from those folks as well. So I appreciate that and I'll be looking forward to the expansion of this panel next time. [14:08] Pious Ali: Thank you, Councillor. Anyone else before I move on? Say none. Mary, you or who will be inviting the panelists to join us? [14:25] Mary Davis: The panelists are here. We have Laura Mitchell, who's the executive director of the Maine Affordable Housing Coalition. Todd Morse, who's the president of the Urbanist Coalition. Aaron Cooper-Ryder is a principal in the New Hype Group. And Patrick Hess is the vice president of real estate at Avesta Housing. Housing, they're going to each take about five minutes or so to introduce themselves and their provide their thoughts on the city's inclusionary zoning policy. And then the discussion will open up to have the council and the panelists, you know, have a question, answer, free-flowing discussion on the topic. So if you're ready, we can just ask [15:25] Pious Ali: Laura if she wants to start with her introduction. Thank you, Mary. I also want attendees to know that we are not taking public comment on this item. We will eventually in one of the three meetings that this item will be discussed. So, all right, now it's over to the panelists to [15:51] Laura Mitchell: introduce themselves. Hi, my name is Laura Mitchell. I'm the Executive Director of the Maine Affordable Housing Coalition. We are a statewide advocacy organization that supports the creation and preservation of affordable housing, so all Maine people have a place to call home. We have about 160 organizations that partner with us and really grateful for the opportunity to share some examples from around the country and kind of how we have looked at how Portland, Maine is performing in comparison and whether it's achieving its affordable housing goals. So that's a little bit of background. I should really start by saying the Maine Affordable Housing Coalition wants more affordable homes and in Portland. That is part of our mission. And the question before you really isn't whether affordability is important. It's whether the current policy is actually producing the homes that you want it to produce for affordable housing. And as we've looked at the data that you've brought in through CZB and spoken with people in the field, what we're understanding is that the economics of this current policy of IZ 2.0, I'll refer to it with the 25% of units at 80% AMI, is not working to produce the affordable homes or other homes that you really are hoping to achieve in Portland, aside for potentially some larger projects that are federally subsidized and might be offsite from other market rate projects. So there's a very significant change in the economics that this policy had when you went from IZ 1.0, the 10% of units at 100% AMI shifting to IZ 2.0. So it also came at the same time that housing development at a national level was shifting with increased interest rates, construction costs, labor costs, insurance, materials, regulatory requirements, and a combination of some other local policies. So it created this economic imbalance where projects just weren't going to pencil out and produce any of the housing that you wanted to see. And really, developers don't get to decide, oh, this project isn't going to break even, but we're going to move forward anyway. They just don't build. And so when a 200-unit project doesn't happen, it's not just those 80% of or 75% of market rate homes that don't get built. It's the remaining affordable units that don't get built either. So we really want to see these projects be able to move forward, and that's why I think the experience of Portland, Oregon is particularly relevant. And I have examples from several other cities, counties and areas. But what they enacted inclusionary zoning several years ago and continued to look at the kind of specifics of the policy. But just this year passed a law at the state level saying that any city that passes inclusionary zoning has to provide a financial offset for that requirement. And so an analysis of what the requirement is going to cost a project needs to be done, and it has to demonstrate what those losses are. And they're just requiring the economics of these projects to be able to work. And there's different ways that the state is allowing cities to fulfill that offset. It can be through financial incentives. It can be through changed zoning and density allowances, changes in parking, fee reductions, so tax exemptions. There's lots of ways to fill kind of that economic gap that's been created. The other examples that I have to share, Seattle, Washington, they have an allowance for affordable units, inclusionary, or you can make a payment to cover the affordable development somewhere else or go into a fund they also implemented inclusionary zoning along with zoning changes that allowed greater development capacity on sites whether it's increased height increased density and so they're recognizing that when you add this requirement in there needs to be some give and take to allow these projects to move forward. An example out of Cambridge, Mass., 20% of the residential floor area was supposed to be affordable, but developers may receive up to a 30% density bonus and additional height. So again, this isn't a financial incentive, but they are making changes to other areas of their zoning to allow for this. So I can share other examples, but what we're seeing around the country is an understanding that an unfunded or unsupported mandate is stopping the development of all types of housing. Because the economics as we think about housing development are not static, the other thing to consider, and what Portland, Oregon has also done, is build in that the policy needs to be reassessed on a regular basis. So interest rates change, construction and labor costs change, rents change, insurance changes, tax and fees change, other regulations change, costs of diesel change, and all of these things affect what a project can support in terms of rents and affordability. And so Portland, Oregon committed to periodically reviewing their IZ policy and making necessary adjustments as these other factors shifted. And so its calibration work really considers different development prototypes, whether it's geography, home ownership, tax exemptions. So there's lots of different things to consider when you are recalibrating a policy like this. Some questions that Portland, Maine could consider as you think about recalibrating an inclusionary zoning policy is something you've already looked at. Are projects moving forward? How many units are being permitted? How many affordable units are you producing? What's the financing gap created by the affordability requirement of the current policy and of potential other levels? And are there incentives or subsidies that you're providing sufficient to close that gap so the project can move forward? So the answers are going to change as the economic and market conditions change. And so your policy should be able to change too as all these things are not static. You know, one approach is to lower the inclusionary requirement so projects can proceed. But what we really think Portland needs to be considering is what are you hoping to achieve for affordability and build off of that? This isn't just about percentages and numbers. It's about building the homes that your community needs for the people that you have and want to have in your community. So the state of Maine has been investing records amounts of public resources in affordable housing recently, and a clear lesson has come out of that. And it's that when you build homes that are affordable at 60 to 80% of AMI, the income for real Maine people, it requires actual dollars to make those projects move forward. There are significant financial gaps to create that level of affordability. And the state has learned and the federal government understands that a real financial subsidy needs to be involved in creating those units. So I guess I will wrap up by sharing one more example. Seattle paired its affordability requirements with that additional development capacity, and I would encourage Portland, Maine to be considering that. And as Portland is the largest economic center in Maine, you know, I work at a state level, but you are the largest city and the largest economic center, and so we look to you guys to be leaders in driving and building Maine's economy and homes for those workers. So thank you very much. [25:27] Pious Ali: Thank you, Laura. Mary, can we time the next person to five minutes, please? Yes. [25:35] Mary Davis: And the next person is Todd Morse from the Urbanist Coalition. [25:44] Todd Morse: Hi, thank you so much. Can you hear me okay? I'm always very paranoid on Zoom meetings. Okay, I'll take those nods as a yes. I'm Todd Morse. I'm the president of the Urbanist Coalition of Portland. We are an all-volunteer advocacy group of people just in and around Portland. And I think one of the core of what we advocate for is more housing affordability. And a big part of our strategy there is to encourage building more multifamily homes. And multifamily homes really unify a lot about our mission, because in addition to driving housing affordability, we also want to create great places that can sustain transit and walkability and bike infrastructure. And we find that when we have this more gentle density, all of these things can be supported and we can develop in a way that is smart and equitable. And our group has fought for, in some form, most of the projects approved under IC 2.0, as well as a lot of the recode changes. So we're really deeply committed to this work and making these projects pencil kind of under whatever policy set that Portland has. has. But one thing I think that has given us concerns with inclusionary zoning specifically is that it's a cost that's really specifically imposed just on new multifamily housing. So single family homes are exempt, homes in other towns are exempt. So this kind of single family sprawl style development is entirely carved out of this inclusionary zoning system. And the kind of multifamily homes that we would like to see a bit more of do have this unique cost. And if we were to impose, say, the fee in lieu on just a single family home, that would add 45 or actually almost $46,000 to the cost of a single family home. And we're not asking for that. And I think because that would really raise the ladder for first-time homebuyers. And I think that level of cost on a single family home would be a lot. And I think it speaks to how affordable multifamily housing can be, that cost can be incorporated into multifamily housing. But the cost is significant, and it comes in the form of cross-subsidy. So kind of building on what Laura was saying, subsidy is great. We really advocate for subsidy. We support the work of the Social Housing Task Force, state subsidy, and we want as much of that as possible. But if you're not getting subsidy, then the funding for the affordable units comes from this notion of cross-subsidy, where the market rate units must be priced high enough to allow the affordable units to pencil. And that means we're putting almost 100% of the cost in these cases for affordable housing on people who are most sensitive to the market rate housing market, which are kind of renters and first-time home buyers. And in some of our analysis on our blog you can read more of, I'm also happy to meet with anyone. We are seeing more homes per capita be built in the surrounding communities of Portland, and we're also seeing better affordability outcomes in towns like, you know, Scarborough and Westbrook in terms of growth, and this is even normalizing for Portland already being a bit more expensive to start. And that's also kind of translating into rents. The last thing I wanted to say, because I don't want to use too much time, is I really want to stress that inclusionary zoning is just one tool in our affordability toolbox. People on this call, this council, has done so much work on affordability in the last five years since inclusionary zoning has passed. We've done LD 2003, which brought more affordable density bonuses, recode. There have been multiple affordable housing tips. The social housing task force work has just been adopted. Portland has passed and then strengthened rent control. And we have all of these tools since 2020 that we don't have. So making a change to inclusionary zoning isn't leaving people out in the cold. It is just reconfiguring the tools that we're using to encourage affordable housing. And I encourage everyone on the committee to take a deep look about what actually makes projects pencil, and just know that this is just one part of the strategy, and we can still as a city be deeply committed to housing affordability and equity. [29:46] Mary Davis: Next. Next, we have Erin Cooper-Ryder from New Hype Group. [29:55] Erin Cooper-Ryder: Hi, good evening, members of the council. My name is Erin Cooper-Ryder. I'm a principal of New Hype Group, which is a Portland-based private for-profit development company. But prior to joining New Hyde Group 10 years ago, I also spent almost 20 years as development director of Community Housing of Maine, which is also a Portland-based nonprofit affordable housing developer. So in my role at CHOM, I permitted projects in more than two dozen cities in Maine, all the way up the coast to Bangor. I'm very familiar with the tools that are available for creating housing for folks who have household incomes at or below 60% of AMI. And I applaud this council's work in trying to create a program whereby we're looking at and trying to help folks who need housing that's affordable to them in a range from 60 to 80 or 60 to 100% of AMI. So I'm in favor of the work that you're doing. I'm in favor of tools that help create that missing middle housing. My comments about inclusionary zoning, which I have encountered on the projects we've done in Portland, five or six in the last 10 years, including redevelopment of the Mercy Hospital campus. I think we did a successful partnership there with a couple of nonprofit developers to create both market rate, affordable and workforce housing on that campus. This. I will say that we view the inclusionary zoning ordinance as it's written today as an unfunded mandate. And you've heard that before, so I won't beat on it too much. I just want to say that it's an unfunded mandate, in my view, at two levels, both at the construction level, but also at the administrative level, because there is a need to income qualify your buyers or your renters to report to the city and to do that on an annual basis. And for developers in the affordable world, that's a regular part of what they do as a requirement for other sources of financing. But for this particular source of financing, if it's the only way in which your development company touches workforce housing, it's something you don't do as a regular thing. I would also mention, we're not going to dive into the weeds tonight, I understand, but there are provisions in the implementation guide that are also barriers. So it isn't just the financing, but also how to meet some of those. And I'll just mention two just as an example. One is for rental housing. There are the way in which the regulation requires you to calculate and report income levels and the interior standards, including minimum countertop space. So I would just say that those kinds of little things sometimes stop redevelopment of older buildings. And on the homeownership side, it's even harder. I think the condo documents are subject to city review. There's a requirement to justify the budget. Specific fees are based on assessed values. These are not the way the market actually does things. So I would just encourage, as you think about the regulation, that there's support for the staff in looking also at how it's implemented when you get to that stage. And then I haven't heard anybody say it yet, so I would just say that as you think about inclusionary zoning, consider in the context of the other regulations, the stretch code, the energy code, the green building code, there are great many things that layer on top of every development in Portland that take time and money to understand and assess, makes it more expensive and more difficult to develop in Portland, and I will say in my experience it's more difficult to develop in Portland than any other place in Maine. And I think you just heard some anecdotal evidence that folks are moving outside. And I agree with you that we need more housing in our biggest city in Maine. So what would I suggest? I guess I think that it may be important to rethink it entirely, and it also may not be possible to just stop and rethink it, that you'll need to take action to keep it in place as more work is done on it. One interim step, moving back to the 10% and 100% of AMI, I think would get a lot of the projects that have been permitted but not moved to construction going. And I think that probably the biggest thing is to consider how this mandate, this unfunded mandate could be funded. I haven't heard anybody mention it. So I will just say your bonding capacity would be a wonderful way to help make this happen. And I do completely, I completely agree that it would be wonderful to have integrated housing, to have mixing common in the same buildings, in the same neighborhoods. So I applause the effort that's going into this. Thank you. [34:41] Pious Ali: Thank you. And now we're going to hear to the last person on the panelist side. So Mary, go ahead. [34:48] Mary Davis: Yep. And last but not least is Patrick Hess from Avesta Housing. [34:52] Todd Morse: Housing, thank you Mary and thank you committee counselors for including me in this evening. I'm Patrick Hess, the vice president of real estate at Avesta Housing. We are a non-profit developer owner and manager of affordable housing across Maine and New Hampshire. We've been based in Bayside for over 20 years and in the city Avesta has 23 properties with over 100 1 000 homes and more than 1300 residents plus one new building under construction and more in pre-development. And we would just certainly love to do more. And I think thoughtful tweaks to inclusionary would certainly facilitate that. Overall, I'm confident that inclusionary zoning provides opportunities for low-income households to access high-opportunity neighborhoods, which is associated with improved outcomes in health, education, economic mobility, all the things that I know this committee has been talking about and holds dear. I would also add that effective inclusionary programs relying strong coordination among elected officials municipal staff developers and other Partners, so conversations like this are key to helping Portland get it right and I appreciate the invitation to participate tonight. To underscore the point that Aaron was making about the mandate being unfunded, I would point out that both non-profit and for-profit developers require capital and or operating subsidies to reach deeply affordable levels below 80% of AMI. And internal cross-subsidization, which is one of the primary goals of inclusionary from the financing side, is only viable in very high rent markets. And to be effective, I think inclusionary policy should be flexible to balance requirements and policy priorities with the value of the incentives being offered. And so set-aside percentages, in-lieu fees, affordability periods should reflect local housing needs, regulatory priorities, and market conditions. And as Laura stressed earlier, I can't agree enough in saying that these elements require periodic recalibration to remain effective. This cannot be a set-it and forget-it tool from my point of view. I would also add that offering multiple compliance pathways should increase production and supports feasibility across a wider range of sites and for a wider range of housing types. So options such as off-site development in close proximity, including folks in those high-opportunity neighborhoods but not necessarily in the same building, can leverage the expertise and financing capacity of affordable housing partners and ensure more efficient operations, compliance, and resident services for those low-income residents, while in lieu fees can allow developers to contribute to municipal housing priorities where on-site units are not viable. That's all I'll say now and look forward to the conversation to come and happy to answer questions as they come up. Thank you. [37:58] Pious Ali: Thank you. Mary, that is it, right? Yes, that's all from the panelists. Yeah, Laura, Todd, Erwin, and Patrick,, thank you, but you are going to stay with us as the committee members discuss this and if any of them have specific questions for you so that we can have an explanation as to or deeper understanding of your suggestions and the knowledge that you shared. I'm going to turn over to committee members to see if anyone have any questions comments or need for clarification from our honorable guests oh well is that a sign that I should dismiss them no oh okay I'm not seeing any hand up that's why I said that [39:02] Mark Dion: I'm going to start with a question then just to get the conversation going Okay. So is that all right, Council? No, go ahead. I expected an evening of a lot of questions back and forth. Maybe I underestimated the brilliance of our guests. They've created an air of submission. I guess nobody wants to say anything. I want an opinion of this concept of possibly, like a carbon tax, transfer the responsibility for below market rate housing. to one developer so that you'd have the capacity to grow some market rate units and then allow someone who has the experience to develop more affordable units or low-income units to carry the burden from some other developer that gets bounced around from time to time is there any reaction from anybody among our guests Yes. [40:02] Erin Cooper-Ryder: Erin? Thank you for asking the question. I think maybe Patrick and I missed mentioning that there was previously more flexibility in the regulation. So there was an opportunity for market rate developers to partner up with affordable developers. New High Group's first project that was subject to the inclusionary zoning was the Luminato Condominium Project on Franklin. And that was a partnership with Community Housing of Maine. That building was new construction and involved the demolition of some smaller residential buildings that had been declared uninhabitable, but the ones that could be saved are back-to-back, so same neighborhood. It saved in a historic building. It was able to serve folks who were renting next to a condominium where folks were buying. It helped, I think, navigate some of the barriers in the regulation that I mentioned when I was first speaking. So I think that's a great idea. Rather than sort of steering all of that work to one developer, I think just the opportunity to partner with folks who have expertise in that area would be excellent. [41:18] Mark Dion: Thank you, Anna. That's helpful. And I'll close with this, Mr. Chair. I just want to comment on the idea that I firmly believed and I continue to believe in mixed economic neighborhoods, that all classes of individuals should have access to the same properties, for lack of a better term. I think that's what makes a neighborhood viable. But at the same time, I recognize that certain developers possess certain expertise, and I would hope that the council can consider how we could incentivize collaboration among those partners to deliver in concert different types of housing so [42:02] Pious Ali: Thank you for allowing me this time. House really, thank you. And I think Todd and Patrick, your hand went down, but top go ahead, and if Patrick have anything to add to this, he can do [42:15] Todd Morse: that after you. Sure. Yeah, I think this question is also possibly getting a kind of off-site compliance and the project that Aaron mentioned is a really good example. This is something that I think makes a lot of sense, but I also think it's worth talking about kind of the trade-offs around. So it's something like, one thing I think it's worth nailing down about inclusionary zoning is that kind of underlying goal of the policy and evaluating it against those goals. So for something like off-site compliance, depending on how it's handled and it can't be handled well. I think the fear there is kind of the concentration of the affordable units relative to the market rate units. And I think that there's this trade-off of inclusionary zoning as a tool for citing affordable units with market rate units. And this could be an inclusionary zoning where 100% of the subsidy comes from, say, the city or the state or something, but it might still have value because you're creating mixed income buildings. Things. But then there's also the value of, are you trying to use inclusionary zoning to generate numbers of units? And if it's the latter, offsite compliance certainly helps with that because affordable developers will in many ways be more efficient and they also have access to funding streams that a market rate developer might not have. So I think that there's kind of this tension between, do you want the most number of units out of your IZ or do you care about the siting in your IZ? And I don't think it has to be a binary. I think that there's offsite that can be mindful of this and so I'm not against off-site by any rate I just think that [43:50] Pious Ali: That's worth analyzing. Thank you, Patrick. And then, Mayor, is your hand up? [44:00] Mark Dion: It is. Can I ask just one clarifying question? It's not a lengthy one. I appreciate Todd's analysis, always do, because he actually analyzes issues. Todd, can you just help me out with the term that you're referring to? I'm looking at a collaboration based on my experience with carbon tax management. Same kind of thing. Other people carry the burden so you can do what you do efficiently. What's the term you're using so [44:26] Todd Morse: I can be up to speed? I use the term off-site compliance. So it means that the units might not necessarily be in the same building or on the same site, rather. All right. That's helpful. [44:36] Mark Dion: I'm done, Councillor Ali. [44:39] Pious Ali: All right, so Patrick and then Councillor McAnubis. [44:42] Todd Morse: Yes, thank you, Chair Ali. I just wanted to build off of Aaron's point about the offsite compliance being, from my point of view, a very valuable tool that is no longer part of the inclusionary zoning policy. And I agree, Todd, that it should be considered in concert with other policy priorities. Avesta has direct experience with this where we're planning to develop on the site of the former family shelter at 197 Oxford Street, 47 units of affordable housing, 100% income and rent restricted for households that are below 60% AMI, in partnership with Reveler, a for-profit private developer who, through our joint site plan, got approval to build unrestricted units on the same block, not in the same building, but on the same block. To meet their compliance, they needed 14 units of affordable housing instead of providing 47. So I think there's a really good concrete example of how off-site compliance can provide more volume of affordable housing units. So if the policy goal is to create as much affordable housing as possible, then I think that should be considered part of the suite of options for a development team to evaluate and potentially move forward with. [46:10] Lori Paulette: Thank you, Patrick. Counselor McNews. Thank you, Chair. Actually, Patrick kind of got to what I was going to say, which is that the two projects that are part of the Reveler master development plan and the phased major site plan that they both utilized that concept of off-site inclusionary zoning units, and that had been removed from removed from the inclusionary zoning ordinance in recode. And you know, I have mixed feelings about that, but it's it's undeniable that the 89 Allen building was able to move forward because it had a publicly funded capital stack. And I guess I don't know when I when I think about this, the I have been thinking about this a lot because I'm looking out my window at it. But, you know, it does occur to me that, you know, when you have units that need to be comparable to the market rate units when it's done this way, you end up with this building will be complete. And by the time the market rate units come online, LA, it may be a very different market. It may be a different construction cost, may very well be. This is probably going to be a 10 to 15 year build out. And that by the time you get around to building the market rate units, there's likely going to be some differences in the market and what you can charge, what the market rate units are going to go for. So is that something that's on anybody's mind when they think about going down that road for inclusionary zoning? And does that question make sense? [48:09] Pious Ali: Priscilla, who is your question? [48:11] Lori Paulette: Oh, I'm sorry. I guess anybody, any of our guests. [48:15] Pious Ali: Or are you just thinking out loud? [48:17] Lori Paulette: No, I'm just asking if anybody, like, because when we're thinking about doing that, you know, separating it off-site as a model, what does that do to the way that you can, the differential between market rate and the affordable housing? Is that making sense? [48:38] Pious Ali: Yeah. Erin's hand is up, and then our guest, Councillor Grant, is also. So Erin, go first, and then Councillor Grant may go. Thank [48:49] Erin Cooper-Ryder: You. That's a great question. So I think it's worth mentioning that because of the advancement in codes and because of the fact that the Maine State Housing Authority, Maine Housing, put in place a green building regulation 15 years ago, quite a long time ago now, I would say that there's very little difference between new construction, affordable housing, affordable buildings built under the LIHTC program, and new construction market rate housing. The differences I think you will see primarily are in finishes and in some cases more expensive windows like triple glazed windows. We've not seen that in affordable housing yet, although I did one project in Brewer when we were doing our first passive house project in Maine. So I think there's very little difference. And I think one place that you might see that, and I think we'd invite the counselors if that's appropriate, to tour the Nightingale and across the street or across the Wooner shares a parking lot with the two community housing of Maine and Portland Housing Authority family and senior projects just to see for yourselves what [49:57] Pious Ali: the difference might be. Okay. Thank you, Erin. We will take that as invitation for those that want to go and see it. Councilor Grant. [50:11] Benjamin Grant: Thank you, Chair. I just want to make sure I'm not get in the way of other committee members that haven't gone yet okay [50:19] Wesley Pelletier: for me to go yeah go [50:21] Pious Ali: ahead i haven't seen any team members that's why i call you okay respecting my place in the [50:27] Benjamin Grant: pecking order here i want to pose this to any of the panelists who might want to stick their neck out on this it's more of the philosophical question that we hear from those who would seek changes to the iz that while we're we're very focused in this discussion on what units are being constructed and who they're for. There's also the theory proposed that increasing the supply of housing has a downstream effect on the affordability of other housing that already exists. In other words, if you build a bunch of market rate, housing market rate, families will go there and free enough space. So I'm just curious if any of you would like to opine as to the sort of the believability or validity of that theory, which is certainly underpinning a lot of what the folks who are seeking changes have been saying. [51:19] Laura Mitchell: Laura. And then Todd. I can defer to Patrick to go first if he wants to. [51:28] Todd Morse: Sure. I would just say in response, Councilor Grant, that at Avesa, we think that more housing is needed of all types. And so we've certainly seen the downstream effects that you mentioned. I think that's been studied pretty extensively throughout the country that providing more housing at various income levels, various price points helps supply more affordable housing of different types and sizes as the market continues to move along. long. So yes, at Avesta, we certainly talk about not just affordable housing for the extremely low and very low income neighbors that we have in our communities, but also just more housing in general is needed. [52:17] Laura Mitchell: Thank you. So Laura, go ahead and then Todd. Thank you. So there is a good amount of data that's particularly come out of some cities recently, like Austin and Minneapolis, where they've reduced barriers to building any type of housing and rents have decreased overall. And Pew Charitable Trust has studied that and seen this kind of ladder effect of people moving up and out and then it being more affordable at the bottom end of the income scale because of these changes. And actually, as more higher end apartments are built, the biggest difference in affordability that's created is at the lower end of rents. So there is data to that effect. The reality is Portland needs more housing of all types. The other genuine truth is that the market isn't going to build enough deeply affordable housing on its own. And that's why subsidy is required. And I think it's less about requiring it as it is providing the subsidy that allows it to happen. And that subsidy can look in a different form of zoning changes, increased density, tax exemptions. There's lots of different ways to kind of allow that to happen. [53:47] Pious Ali: Okay. Thank you. Todd? [53:51] Todd Morse: Yeah, I think Lauren and Patrick said a lot of it. The only thing I'll add is we talk a lot about building more homes, and I think that the data really does bear out that helps. We kind of just did an analysis on Portland and the surrounding towns, and though it's very hard to get data on these things, I think the patterns that we're seeing suggest that even here in the greater Portland area, supplies in places like Westbrook and Scarborough are at least helping to slow price growth. But I also think a big part of it is by allowing supply to happen where we can, it also frees us up to get one, generate more subsidy and to apply that subsidy to people who deeply need it. So I think that it also kind of hopefully can serve as a force multiplier for affordable housing instead of kind of thinking of it as zero sum, that having more market rate housing inherently means that we're going to have less affordable housing. And I think it's important that we hopefully move away from that mindset. [54:53] Heidi McCarthy: Thank you, Counselor Sykes. Thank you, Chair. I'd like to thank all the panelists that were here today. I think it's been really illuminating, and I think also I'm really encouraged by what I'm hearing. I think that this has been a really contentious issue over the last five years or so, and one that I think has created a lot of divisions in our community. And I think it's important to understand that what we really want here is more housing and more housing for people that can't afford market rate housing. And I'm not hearing any dissension from that. Certainly, we need housing at all levels of the income spectrum. But I think that we are largely united here tonight, anyway, on the idea that we have a value in Portland, that we would like to see mixed income communities, we want to make sure no one's priced out, we want to produce housing for people that work here. And so I think that's really encouraging. This is similar to the feeling that I've had over the last 12 months of being on the Social Housing Task force and really digging into this problem, digging into specifically why we're not able to produce housing for incomes in the kind of missing middle range. So that would be essentially from about 61% of AMI up to about 120% of AMI. So huge range, but that is the place where we're not doing a good job of producing housing. We have a lot of LIHTC and subsidy programs that are specifically producing housing at the 60% AMI and lower. And we're just not able to get that missing middle. And so I'm encouraged by hearing the concept of subsidy for helping to make feasible the IZ that we'd like to see or the affordable units that we would like to see, which I think we're saying we want about 25% of the housing that's built in Portland to be affordable to workers. I mean, that just seems pretty reasonable to me. If we're going to say 100% of housing can be unaffordable for people that actually work here, that just seems illogical. And so I think what we need to start, and I think Todd said this quite well, start with our value, figure out what housing we want to see, what that looks like, and then find out how to make that happen. There are a lot of different ways that we can do that. Social housing is one of them. That would be essentially bonding for housing, and actually the city retaining that public housing as publicly owned housing. There are other subsidy programs out there as well, but I think it's really important that we recognize that we really are aligned on a lot of the values that we hold, and it's just a matter of trying to figure out how to make that work. So thank you very much to the panelists for being here tonight and for your thoughtfulness. And I look forward to working with you in the future. [57:53] Pious Ali: Thank you, Chancellor. Mary, how are we doing on time? [58:00] Mary Davis: We're at 630 right now. So considering the state late start, we're just about where we should be. [58:11] Pious Ali: All right. So I'm going to assign 10 more minutes to this and then we'll move from here. I thought I saw a hand. Erin, was it you? Yes, sir. [58:24] Erin Cooper-Ryder: I wanted to just comment on Councilor Sykes. I wanted to say that I think it's wonderful that the city of Portland is thinking about financing for the Mincing Middle. And the primary reason why we have a lot of financing for folks at 60% of AMI and below is because we have a federal production program in the low-income housing tax credit, and there is nothing else like it. So for a municipality to be tackling this idea, you know, struggling with this idea, I think is really commendable. So it's hard, it's really hard to do. And if there was a federal program, it would be a lot easier. Year so I am in full support of that. I think that it's not really the number 10, 12, 25, it's subsidy [59:13] Pious Ali: for those units. Thanks. Thank you. Is there any other comment, question, seeking more clarification from committee members before I thank our guests and continue over the meeting? All right. Erin, Laura, Todd, and Patrick, thank you very much for taking the time of your busy day, afternoon, evening to join us. We are going to move on to the next agenda item. We will have two other meetings if there is the need for us to invite any of you. But hold on, don't go yet. Chancellor Phillips. [1:00:04] Regina Phillips: Lips. Sorry, my question has nothing to do with this. I just noticed that Greg Jordan is on the panelist side, and I didn't know if anybody, if he needed to be on this side. So sorry for that. [1:00:19] Pious Ali: All right. Thank you. All right. So have a wonderful evening. It's okay if you also want to stay and enjoy the rest of the meeting. All right. You cannot wait to leave. Thank you. The next item on the agenda, so just for those who are attending, we will have two other meetings on this issue before we take any vote on it. And we will also take public comment in a future meeting. The next item on the agenda is something that will also respond to some of the questions or some of the things that our panelists have talked about. I believe that this is one of the items that during the work plan for the whole council and also this committee, the issue of streamlining our building permit to make it easier and faster. And we had someone say that they are not building in Portland because of some of the way things are done in Portland. And to that I will call, is it Jessica? Yeah, she's here. Jessica, over to you. [1:01:48] Laura Mitchell: Thank you, Counselor. I wrote a memo which was in your backup material for this meeting. I'm just going to quickly review it and then open it up for any questions that anyone has for me. The memo really speaks to our current permanent processes and changes that we have made in the last five years. We have many codes that are applicable to us in both our city code and then our state building code, which is the main uniform building and energy code. The city of Portland, which was referenced in the last item on this agenda, we do have the energy stretch code, which is unlike other municipalities in the state, which is an added layer for people building in Portland. We also review our plans to NFPA, which is the National Fire Protection Association. Association. If you go over our statistics in there, you can see in fiscal year 24, 25, and 26, the number of permits applied for in this department is approximately the same. We average well over 100 permits applied for each week. So last fiscal year, we had 5,573 permits applied for. We're a very busy department with a lot of building going on here. I did a benchmarking project this past year. Can't compare us to anyone in Maine. That was also referenced last in the last item. There's no other municipality that is like us in size. So there's no one for us to really compare to in the state of Maine. So I reached out to 20 municipalities across the country that had very similar population sizes as us and some other issues. I did many different places around the country. Only eight were actually able to provide me with any comparative data. A lot of municipalities don't actually track how long it takes to review a permit or any of that. Based on the issued permits, Portland fell in the upper half of the amount of permits that we review each year. There's eight municipalities, and it was pretty consistent among the similar size municipalities for the number of permits that we do review. There was one municipality, Georgetown, Texas, which is greatly higher than the rest of us, but they also review for sidewalk permits, street permits, water permits, a lot of permits that are handled by other departments within the city of Portland. The duration of plan review was one of the items that I benchmarked, trying to compare the average number of days it takes for us to review plans based on what other communities had. Only four of those committees were able to provide an average for first submission of plans. So how fast and quickly they were able to review plans from the date that they received it until they sent it back out to the applicant. For residential permits, I broke it up to residential and commercial. Portland was tied for the lowest, 14 business days from when someone applies to when we send it back to the applicant for resubmittal or issue, depending on the plans. And for commercial, Portland was the lowest with 21 business days. And then no other community tracks the average for the complete review. So that's from application to issuance. In Portland, we do track that. And for residential permits, the average is 31 business days, and for commercial, it's 45, which I'll talk about a little bit later. I'd also note that 80% of our permits are issued on the first revision and 90% on the second revision. No other municipalities that I checked with were tracking that data either. So over the last five years, I became the director of this department in April of 2021, and we've done a significant amount of upgrades and improvements. Improvements we've updated all our checklists, and part of updating them is we review them every year to make sure everything is consistent. Especially when a new code is adopted, we go through them. We've created pre-submittal meetings on major projects, pre-construction meetings for major projects. We also offer permit assistance meetings for all types of projects, so even someone building maybe a shed or a deck in their backyard, we'll meet with them. All our steps and timelines are visible on the citizen self-service portal. So anyone can go on right now and say, oh, I'm building something at 389 Congress Street. Where is it? We created YouTube videos, instructional videos on how to register for citizen self-service. We've created a ton of videos, but one directly at how to register, which is very important. Updated all our permitting guides. We consolidated the reviews. So it used to be that a building plan reviewer reviewed a set of plans while a life safety plan reviewer while a zoning plan reviewer while someone from DPW historic everyone reviewed separately, so the applicant was getting multiple revisions sent to them. We've consolidated all those reviews so all those reviews happen on one document, so when the applicant gets it everyone's comments are on one page. More training for staff, we or reorganize the review team. We have seven plan reviewers, we had four building and three real life safety. It made more sense because of more projects that involve just the building code. We went to five building and two life safety. We provide guidance docs for our staff. So if there's a common, a new code and not everyone's sure how to apply it, we create guidance docs for staff so that we're trying to be as consistent as possible. When I started to, not all of our code officers received a complete set of code materials, so we now provide that. The state used to actually provide them provide so many copies to our department, we budget for that every time we have a new code update, and all of our staff receive their own sets, and we implemented last year yearly customer service training directed completely at our staff. We have one for people in the field, people that are like our inspectors, people that sit at their desk reviewing plans, customer service, intake staff. So what have these results shown, right? We've done these improvements. You can see that our average falls below for review time for other communities. So we compared it to what we had in 2021, which was our highest point. A lot of that has to do with COVID. We had a little uptick then of residential permit supply, and after the down it's about of 2020. So the first chart shows the average turnaround time for permits with a plan review, with and without. So there are some permits that don't require a plan review, and that would be like an electrical permit or a plumbing permit. They're attached to an actual building permit, so there's no review for that, and then a combination of it. The second chart breaks the permits down with a plan review into two categories, residential and commercial. So residential, I said earlier, our average is 31 days. As you can see, the highest it was 75 days four years ago, and now we're at 31 days average. And four years ago, commercial permits were over 100 days from when we take them in until when we issue them, and we're down to 45 days. Both of those review times have been cut in half, and we're always working to get better and faster and more efficient. We also started a survey. So every time anyone is issued a permit for a residential commercial, they receive a little survey at the end. How was it? Was your service excellent? Was it good? Was it fair? Or was it poor? So as of September 16th, I believe, when I ran these numbers, we had 29 responses. The majority of them are excellent. And we review that weekly,, sometimes twice a week, I'll look at that to see. People submit comments to us. Anyone that has been poor, we immediately investigated and seen if there were steps that we could take to make sure something like that did not happen in the future. So staff in this department is focused on team development and training. We periodically, like I spoke earlier, review our internal workflows, review our checklists, our help guides. We meet every, I personally meet every other week with all of our plan review staff, and we review the pendant permits that we have for all the major developments. We're committed to providing excellent customer service as we establish our own customer service training program, and we really want to commit to provide an excellent customer service to our citizens while ensuring that we permit safe, code compliant structures in Portland in a very timely fashion. That's an overview of the memo that I created and sent to all of you, but I'm happy to answer any questions or provide any clarifying information. [1:10:44] Pious Ali: Director, thank you very much for the update and all the good work that you guys are doing. So with all of these, we still hear people and you heard somebody from the previous item saying that is why we don't do this in Portland. Why do you think they have that assumption or what is, what is the reality from what they are saying? I think some of their [1:11:08] Laura Mitchell: comments were related to the cost of land and property here in Portland, which is unrelated to my position. I know they reference the Green New Deal, which is why we have a stricter energy code. We do hear some pushback on that. We hear there's, sometimes it's really hard to change a negative perception of a department. And I think we're also a regulatory agency. So there's times where people are just not going to like us because we have rules and regulations that people have to follow. It's a really challenging position sometimes to make sure that everyone's building something code compliant. And on top of that, making sure that they're happy while they're doing it. So we kind of walk a fine line at times with that. But we are working really hard to change people's impression of our department and make sure they have a good experience when they do work with us and based on i look today and we're actually up to 41 comments on our survey and it 's really nice to see the nice comments they whether they call out specific staff members or just talk about our department at all you know as a whole it's really nice to see the positive comments too, which we have 39 positive comments and two negative. So I think sometimes what we hear is not always what's actually happening on the ground. I don't know [1:12:28] Pious Ali: if that answered your question. Yes, it does. I want to ask one more question and then I will open it to my colleagues to also ask questions if they have any. Ludit said that from the survey that you took in the past, passed recently. There were some comments that were given that was asking for an improvement. Do you want to share some of those without necessarily mentioning names? [1:12:57] Laura Mitchell: The one comment that we had that we investigated, what the issue was, we've had two negative comments from our survey. So the survey went live in mid-May and it's live now. We're going to keep the survey up at least for a good year to get a really good feel for everyone. One of the comments was related to having to sprinkle a single family home, which is a policy, not necessarily something that staff here had done. And then another comment was about how long it took for their permit to go through because of certain technical questions that were asked. We reviewed both of those issues and talked with the plan reviewer and just made sure that we're all on the same page. The whole group of them are on the same page about what is required and what is not required for certain types of permits. All the other, I'm happy to read you all the good ones. I would happily read all of the good ones to [1:13:48] Pious Ali: you too. Yeah, you can share that with us. I thank you and congratulations on getting all the good comments. That is the way things got changed and improved. So thank you for taking that step and being vulnerable to the public because I know for sure that even those of us who are on this side of the aisle, it is not nice when we receive those nasty emails that we don't know what we're doing. So thank you. Chancellor Sykes. [1:14:17] Heidi McCarthy: Thank you, Chair. Jessica, thank you so much. I think that this is a great report, and I think it's really encouraging. I feel like we've seen a lot of improvement. I have been really appreciative of the kind of outreach that you've been doing. I'm sorry I didn't come to your open house. I really wanted to. I wasn't able to get there. But I is otherwise kind of an opaque process, really more understandable to the public. And I agree that a lot of people, you know, people don't like to be told what to do. They, you know, they like, they have a vision of what they want. And so it's easy to take it out on you, but you're just following the law and making sure people are safe. And so I really appreciate that. It does seem that we've seen an improvement in terms of the timeframe when permits are getting approved and the turnaround time sounds like it's really good. One of the questions I would just ask is, going forward, how are we going to continue to analyze this data? So like one of the things is, you know, that 31 day and 45 day, do we look at that and, you know, look at it not just like kind of as an overall number of days, but do we look at that and say, where are these things getting hung up? Where's, which stage of the process is kind of the bottleneck? You know, is it in our hands that we're unable to kind of get it to the next stage? Or is it that the applicant is kind holding onto it or unaware that they need to do something. So just one of the things I've heard from some developers is that sometimes they weren't aware that they had to do something. And so it may be sat in their handle a little bit longer. So I guess I would just ask, what are the plans to kind of look at that time turnaround and determine if they're still bottlenecks and if [1:15:50] Laura Mitchell: it's in our hands or if it's in the applicant's hands? So great question. And every year what we do is we talk to the permit technicians that take in all the permits and we say, what are people missing the most, what are the couple things that someone's always missing, and then that's when we start working on like what can we change in our permit applications, what can we change in our faqs, what can we change in our guides that really clearly states that you need this or you need that, and so that's being done every single year as we review all of our documents. We also started, we were finding that the person who's the contact on permits is usually the designer or the contractor depending on what the permit is, so a lot of times the developer or the homeowner wasn't aware of what was actually happened, so we created, we created a standard operating procedure for staff here that if you've had three, if you're at your third review of a permit, which is a little outside the norm, you're now going to contact the homeowner or the developer so they're aware of what the holdup is and stuff. So I think sometimes it's, it's like the game of telephone. We say one thing, the developer might not, sorry, the contractor might not express it clearly to the developer. And it kind of just goes around in a circle. So we did that with our staff that we think that is important, whether it's a homeowner, you know, someone's putting a deck on so they can be aware of what the concerns are and what the issues are. And then if it's a developer too, so that they're kind of looped into it, so that they're aware. I also started, whenever we have projects that are over a million dollars, which we have quite a few of, I'm sending an email, I started this like two weeks ago, that to the developer to give them a lot, you know, my direct email, phone number, and if they have any questions, they can reach out directly to me if they feel like there is an issue, and we can deal with it directly at that point too. [1:17:42] Pious Ali: Great, thank you so much, Jessica. You're welcome. Thank you, Councillor McEwen, and then the mayor. [1:17:49] Lori Paulette: Great. Thank you, Chair. Yeah, thank you, Jessica. This is a really great report. I'm actually not super surprised by the compliments because I've had some conversations with folks about projects they've been working on, individuals, you know, as opposed to an experienced person. But they've really said that you're a good department to deal with and that they feel like they're being treated well and but there's still a lot of confusion and then you know that's that's partly because it is a you know it's a there's a lot to put your head around so and you do have educational materials it sounds like a couple different folks they the way they put it was that you know you're really great at guiding them through their questions but they felt like they had more than they would have of light and that a guide on, you know, the whole process would be, would be helpful. So can you tell me a little bit about how that, how that does work, how you kind of walk people through what they need to do for different projects? [1:18:58] Laura Mitchell: Yeah. So I think there's a difference between like an experienced developer and a homeowner, right? So a homeowner, a lot of times we'll get applications that are not necessarily complete. And we recognize right away that the homeowner is the one actually designing the project. It's hand-drawn. It might not have all the code material it has. We tend to pass those through intake, even though it's not complete, and have the plan reviewer reach out directly to the person. We also created a guide for our plan reviewers. Very many, lots of different generations. Some generations don't like to talk on the phone, they only like to email. Some generations only like to talk on the phone, not to email. So kind of given all of our staff guidance on if you send an email and they don't respond in, you know, 48 hours, pick up the phone and give them a call. So some of it is just talking people through what they need to have, guiding them to the right codes of what they need to have. I know we had a homeowner building a deck the other day and was really confused about what a footer was and where to put beams and what he needed for support. And our plan reviewer walked them through it. The gentleman called her and said, you saved me thousands of dollars. I don't know how else to thank you. So they were going to overbuild their deck just because they figured the more wood they put under it, the better it was. So there's stories on both ends. Experienced developers, they tend to know. We have our biggest issues when we change codes. So if we're in the middle and we've adopted a new code, sometimes that when there's a little bit of gray area there where everyone's being educated with the updated codes, there aren't a lot of classes that people can take as a homeowner to learn how to do it. YouTube, people tend to look on YouTube for guides and things like that, but we do our best, we use it, we even do some site visits with some code officers, our building inspectors will go on site too and kind of help out. We've gone on site to measure setbacks for people, we've gone on site to do a walkthrough to say this is what you're going to need in this space, whether it's our housing safety inspectors or the building inspectors. We're, we're at a lot of properties every single week and some of that is the outreach that we do. It's not just always right here at our desk, we're out in the field to kind of guide in some people. We want, we want our staff to meet people where they're at, right, so everyone's in a different spot and that's really important to us and kind of changing that mind frame for everyone I think is [1:21:23] Lori Paulette: is important and we're working towards that. Great, yeah, thank you for that flexibility. I know people are often, they often fear the permit process and that can be what drives people to not even, you know, get a permit that they will then regret not having gotten. So yeah, I really appreciate the work you're doing. Thank you, thank you, thank you Amelia. [1:21:45] Mark Dion: Thank you, Mr. Chair. Jessica, I want to say this. Your team does really good work. Let's put that out on the table, okay? And when I have forwarded questions or complaints, when I get a response from you, I always go, I get it. And I support what you've communicated to me, okay? I may not run up the stairs and say, good job, but since I don't follow up and say, I don't get it with an exclamation point. You understand? Yes. Here's what I think. I think you do have a customer service challenge, right? I was telling the fire chief today, if he saves a birding foundation, they applaud him and they want to give him an award and he's my hero. If a police officer kicks in a door to go after an offender, we're in federal court trying to determine who actually was the offender or the occasion, right? You're kind of more like the police than you are the fire department. So often the feedback I get is people communicating to me, not a complaint about the code, whether it's life safety code or our own code. It's a sense that your team is organized to say no and not get to yes, all right? And that is not, and I want to underline this, it's a critique of your staff's work or your direction, but it's like a restaurant, you know, the consultant says, why don't you have any customers, my food's great? Well, maybe not, because there's nobody in the restaurant, right? So I'm really interested, and I don't need in an answer this evening, is to what your customer service strategy is. You know, I think one minor thing, if you're getting all this positive feedback, it should be posted somewhere. Because if I'm going to the inspections website for the first time, I want to see that other customers had a positive experience, because then I feel a little bit more confident asking my stupid question, right? Like, I know staff will sometimes say they ought to know the answer that, but they don't. Frankly, I don't. And I've had insurers show up at my house when I build something and they say, geez, that back is off. And by the way, do you have a permit? You know, and I did, but I didn't do it well. So I totally understand that you're dealing with a challenging population. So I would hope to see a fully developed customer service plan that somehow shares the positive so it builds confidence in our future clans. You know, I want them to know that not only we are the best at what we do, but they can expect the best outcome. It's like the email you sent me today, right? I was sympathetic to the complaint. It's about putting in a heat pump in a cottage on Peaks Island. And I perfectly understand why you had to say no. Know, you, the collective, you, the staff. So that's my job to explain to them. And I want them to get to a place where they can say, yes, I understand. So we all have a challenge. So I want to encourage you to move forward. I think a lot of value in the positive feedback. And when we engage a community engagement officer, that's one of the pieces I hope that individual attends to is to help you manage the customer experience so that we can communicate positive outcomes to those who might be standing in line for their first permit. It's really intimidating. And by the way, every time we can tell the client, not the architect, not the builder, not the handyman who's trying to do the work, but that client as to what's going on, then they can sort out how credible their service person is. You know, because I sometimes think someone's passing the buck in hopes it lands on your desk. So, and I think the counselors support staff as well. I've never heard them be critical of your team. It's just that we get that negative feedback. Because when other communities, I like going to Westbrook because they seem to organize to get to yes. They're enforcing the same codes we are. But somehow they've managed a different expectation and therefore outcome that makes everybody happier. So it's just an observation. You can take it for what it's worth. I don't do your work every day, but I want you to know I sincerely appreciate what you do and the others do. We just need to tell them more about the good stuff we do through the customer service agenda. [1:26:43] Laura Mitchell: Thank you for your feedback. And I do agree, like Mike, I send all the positive things we send to staff so at least helps build up their confidence at first, but sharing that with the public would be helpful and I'll find a way to do that in the future. [1:27:00] Mark Dion: I don't expect people to read the communications and say, I got to rush in and get a permit. I don't even know why. [1:27:08] Laura Mitchell: Well, one of the ways I- [1:27:09] Mark Dion: You know, but I want people to say- And it's not the big developers that complain to me so much. So, you know, Jessica, it's the homeowner that wants to put on a deck or a real simple extension, like a post porch or something like that. And they just feel frustrated and neglected. And if we can figure out a way to make them feel like, wow, we're so happy you want to be able to do this. This is a good thing for our city. You know, I think it's not getting paid. It's not a performance of the specialized work. Where it's the marketing of why you do what you do and so people can understand it and appreciate it. So I've used up my time. I apologize. [1:27:51] Pious Ali: Okay, thank you, Mr. Mayor, Councillor Phillips. [1:28:01] Regina Phillips: Thanks for this, Jessica. This is extremely helpful. As I was reading it before the meeting, I was jotting down some questions, and as you were going through it, I didn't really have a lot of questions to ask because you really went through it very well. I just really want to piggyback on to what the mayor was kind of talking about to some degree, which is, you know, the thing that we've been hearing in the past or the things that I'll just pick on myself that I've been hearing in the past is people go to inspections and they get different answers from different inspectors. And so when the mayor is talking about that customer service, I think that 's part of it as well, right? Right. And so I'm really happy to see or to hear about all the staff training that has happened and all the other steps that you've put in along the way in order to cut that, you know, to cut that communication down. Because the communication, again, I'll just speak for myself. That's the thing that I've been hearing for the last couple of years is there was no communication. It took us forever. The other thing Council Sykes said was that they didn't hear from anybody. They didn't know that they had done something wrong, that there seemed to be two and three and four steps that people had to go through before they got a permit. So I was really grateful to hear about the staff training so that people can be on the same page so that they can hear the same message. Because what it was reminding me of was, I hate to bring it up, was general assistance. When I worked for the city, literally you would go to six different people and you'd get six different answers. And so it's really great to see that there's that communication among staff and that training. And again, the outreach to the community. And I agree with my colleagues. I really hope that this can get better. I know you've put it out there. I'm flabbergasted at the fact that we're actually approving permits, even when they go back a second of time within 30 or 45 days depending on depending on what permit you're applying for so anyway kudos to you and keep up the good work and thank your staff i 'm sure they're not they're not listening to this but kudos to them as well thank you very much i'll pass [1:30:18] Pious Ali: that along. Thank you, counselor. Any other question, comment? Say none. Jessica, thank you very much for joining us and for the work that you do. We hopefully will talk to you soon. Yes, thank you. All right, the next item on the agenda is I think part of Finian, the interim housing and economic development director and Nancy Martin will take the lead on this. We are going to look at the purchase and sale agreement with Nordic Spa of condo lots number three and number five at city-owned Portland Technology Park. Once they are done, I will ask committee members if they want to go into executive session. But for now,, Pat and Nancy, over to you. [1:31:24] Anna Bullett: Thank you, Chair. And good evening, counselors. So in your packet tonight is a draft purchase and sale agreement. This is a result of feedback that we received from this committee in July regarding offers we had received at the Portland Technology Park. So the offers at Units 3 and 5 are planning to use the sites for a Nordic-style spa. And Corporation Council has reviewed the draft purchase and sale agreement that was included in your packet. it. So the purpose of this agenda item is to review and answer any questions you may have and then based on your guidance and review for a possible vote to recommend city council approval of the purchase and sale agreement with Nordic Maine for units three and five at Portland Blue Technology Park. So happy to answer any questions. [1:32:39] Pious Ali: Thank you. Is there any Komichi member questions or comments? Chancellor Sives. [1:32:58] Heidi McCarthy: Thanks, Nancy. This is exciting. I think it's a great business concept, and I'm excited to have it in Portland. I just have a question about, what protections, it looks like there's some protections in the, in the contract for what happens if it's, if it ever becomes a nonprofit. Can you tell me a little bit more about that? [1:33:28] Lori Paulette: [1:33:33] Anna Bullett: i think i may ask incorporation council michael goldman if you may have a response [1:33:40] Michael Goldman: on that question. Sure, that I think you're looking at the scrolling through the agreement, I think you're looking at language that's in chapter in paragraph 3D of the agreement, and we typically require you're talking about the requirement to make a basically a payment in lieu of taxes that the property ever becomes exempt. That's a term of provision that we include in pretty much all city purchase and sale agreements. When we sell property, we want to get it back. One of the one of our goals historically has been to get it back on the tax rolls. And so we do include this and we put it in our in the deed so if the property does ever become you know would otherwise be exempt or entitled to an exemption this provision which is in the purchase sale agreement and will also end up in the deed to the property will require [1:34:43] Heidi McCarthy: the owner of the property to continue paying taxes. Can I just have a round of applause? I love that. [1:34:51] Michael Goldman: Well thank you. I wish I wish I could take credit for it. I think I think it's been more consistently applied over the last probably seven or eight years that we've that we've done it, but it is something that city has included. I've seen it in older purchase [1:35:09] Heidi McCarthy: and sale agreements as well. So this may be the first one I've seen so all right well Pop my eye, and I appreciate it. So thank you. [1:35:18] Pious Ali: All right. Sure. Thank you, Councillor. Councillor Nickinowitz. Thank you, Chair. [1:35:25] Lori Paulette: Yes, to Councillor Sykes' point, I just wanted to mention this was, I think, the most recent example of where this was applied was the redevelopment of the public works parcels in Bayside. When they sold those parcels, there were a number of covenants on them, and that was one of them. So when one of the properties, 55 Portland Street, was proposed as offices and then it turned to a nonprofit office use, they're now paying a pilot for that. So we were able to keep it on the tax rolls. And so it actually it does work. [1:36:00] Pious Ali: Thank you. Is there any question, comment from committee members and other councillors? Consular Phillips thanks [1:36:14] Regina Phillips: this is just kind of an overall question maybe and maybe this is for corporation council what happens when we actually sell property like where is this 525 thousand dollars going is it going to i probably should know the answer to this but i don't so is it just going to our general fund does it go just to how it goes to the general fund [1:36:38] Michael Goldman: Yeah, it goes into the general fund and then, you know, through the budgeting process, it would get, you know, appropriated for whatever, for whatever purpose. It doesn't, it doesn't get, you know, there are, there have been times where, in the past, where purchase and sale agreements have been, you know, the proceeds have been, you know, sort of immediately appropriated for a particular purpose, but our general practice is not to do that. [1:37:05] Regina Phillips: Okay, thank you. [1:37:08] Pious Ali: Thank you. Before I take public comment or ask for a vote, do committee members or corporation council and committee members, do we, does anyone want to go into executive session, or we are all set with where it is? I'm [1:37:27] Michael Goldman: good. Yeah, I don't, I don't believe it's necessary at this point. I know, I think we, when we first brought this forward with, there was an executive session where we talked about the, business terms of the agreement, so I think it's probably unnecessary, but of course the committee is welcome to go in if you wish to. [1:37:45] Pious Ali: All right, so since we are going to vote on this, I'm going to take a public comment. If there's anybody who wants to comment on this, please raise your hand and you will be allowed to speak to it. Joe, yeah. [1:38:03] George Rowe: Go ahead. Yes, can you hear me? Yeah, we can hear you. Excellent. So, I have a lot of trepidation with this proposal. We've, you know, probably should have spent some time just reviewing the Portland Technology Park's, you know, 15 plus years of relative failure. [1:38:30] Regina Phillips: Excuse me, hold on. Chair, do we, can this person introduce themselves and tell them where they're from? I don't know who they are. [1:38:38] Pious Ali: Yeah. Yeah. Doug, please introduce yourself and the district that you are in. [1:38:44] George Rowe: Oh, yeah. Sorry. I think I might have goofed on my tagline. So my apologies. I thought I put something in there, but maybe there was a mistype. My name is George Rowe. I own property in Portland and Bayside since 2015. So I, you know, one of the things that's disturbing about this proposal is we don't know anything about the management team and the developer and what their track record is on, you know, anything really. But in particular, creating on almost three acres of land. I mean, that's a huge amount of land in the city of Portland for some kind of a hospitality business that is going to be a quote-unquote Nordic spa. Now, I don't know what the marketing studies have been for this business idea, why anyone would be coming off the turnpike, which obviously has some convenience associated with it, and be coming to this little corner of Portland versus a lot of other places in the world, you can have your Nordic spa experience like Canada and Scandinavia where it all started. But anyway, the point is this seems to be an enormous amount of land being given up for a boutique idea that, again, the management team, where are they and what track record do they have about pulling this off? A good example of this is the vertical harvest project in Westbrook, which was like growing, you know, salad greens in a, you know, sort of a big giant building vertically. You know, it turns out that those people really don't have a good idea what they're doing and they're probably going to go bankrupt. And the city of Westbrook has, and other partners have spent an enormous amount of money literally handing them this opportunity, and it wasn't ever a really viable idea. So this should be housing. The entire Portland Technology Park should never have been a biotechnology cluster, which is what it was pitched at about in 2010. That was a failure out of the gate. It was silly. It never had any real commercial basis for it, but it looked good on paper and we got some money out of the federal government to build a road and some electricity infrastructure, which is pretty much what it was used for. Three minutes. It should have been a new neighborhood that could have created possibly thousands of housing units that would have addressed the housing shortage that you all are still completely puzzled by, even though you continue to give three acres of land to a Nordic spa and completely ignore the fact that it could be a housing opportunity, even if you have to wait for these commercial restrictions on it, which may not even apply to a commercial residential rental housing development. I don't know. You'll have to talk to the Economic Development Association or a group or entity in DC, but I'm pretty sure that could have been worked out. And you also have three years in which to plan a giant residential project here in time for it when it's ready to start construction and has all its permits in place and everything, that commercial restriction would be gone anyway, because it probably takes about three years to get a major project off the ground. So again, I don't think this is ready for approval. I think it's probably a bad idea. And you're also giving this away, frankly, a half million dollars for three acres of land in Portland seems crazy with turnpike access just a few steps away. Thank you. [1:42:31] Pious Ali: Thank you, Mr. Rowe. Is there any other public comment? Say none. Is there any committee comment, questions? Say none. We have a motion and a second. I'm moved. Second. Moved by Councillor Phillips, second by Councillor McNewish. I am going to call the roll. So, Councilor Sykes. Yes. Councilor Phillips. Yes. Councilor McNeil. Yes. And I am a yes. All right. The next item and probably the last item on the agenda is for us to consider recommending to the city council for approval a resolution requesting that Director of Planning and Urban Development apply to the Planning Board for text amendment to the land use code to prohibit data centers in Portland. And, yeah. And Corporation Council, this is yours. [1:43:48] Michael Goldman: Thank you, Councillor. Yeah, I know there's been some discussion, obviously, in other towns as well as in this town, and concerns that have been brought up about data centers and the development of data centers with the sort of unknowns that are associated with them. And so I know that this committee, I think at the last meeting had discussed the potential for a moratorium in between that meeting in this meeting I had suggested because planning staff were already working on doing some research I don't know I don't think Kevin Kraft is here anymore but he and his staff have begun sort of researching potential regulations potential changes to the land use code to address regulation of data centers. And we were feeling that a moratorium wasn't necessary at this time. As far as I know, there hasn't been any interest expressed by developers in doing that in Portland. I know it's been, you know, there have been applications filed in other cities and towns that have more land available, I think, probably than Portland. But what this would do is, if it's approved by the council tonight, it would move to this, or I'm sorry, if approved by the committee tonight, it would move to the full council. Council, the resolution essentially requests that the city planner bring forward proposed regulations for discussion at the planning board level, which would eventually come to the city council for a vote. And they're already, Kevin, like I said before, is already in the process of doing this. So this is likely to happen anyway, but this will show council support for the concept. I'm happy to answer any questions, although I will say I'm no data center expert. [1:46:03] Pious Ali: Yeah. Thank you, Corporation Counsel. I have seen Counselor Seitz's hand is up. Counselor Seitz, go ahead. [1:46:12] Heidi McCarthy: Thank you, Chair. Thank you, Michael. So I just want to raise the obvious thing that I saw upon reading the resolution is that it actually doesn't ask us to ban data centers. It just says that we will address the development of data centers. So this resolution essentially does nothing so if that's what we want to do if you want to ban them we probably ought to consider a text amendment to this resolution i'm not sure we do but whatever we can figure that out at the council level on the floor or we can do it now but it does not do what the title of the resolution says that it does the other piece that i just want to flag is that today just randomly some new marketing materials for the Davis farm property out in Riverton, Riverside came across my desk and that property has dropped from the 11.17 million dollars that it was purchased for several years ago to about half that so and that property has a tremendous amount of electrical capacity already in the building. And it is poised to be snapped up for this purpose if that is on anyone's radar. So I don't think that we should rest on the idea that we don't have to consider a moratorium or that we should allow a kind of wishy-washy resolution to go forward. So I'm not going to come down on either side of this issue, but I'm just setting in the landscape that there may be things that we haven't considered yet with this. [1:47:47] Pious Ali: Thank you, Councillor. Any other committee member or councillors who are here comment, question? Say none. I am going to take public comment on this. [1:48:20] George Rowe: Mr. Rowe. George Rowe, Bayside. I actually am very curious about this because I, you know, where my home is in Hanover Street, there actually is a data center just about a block away. It's wedged in between Preble Street's former teen shelter building on the corner of Preble and Cumberland and Brown Street. It used to be an old moving storage building from, I think, literally the 1920s, where rich people would store their furs and their pianos and their expensive furniture when they were... Can you hear me? [1:49:13] Pious Ali: Yeah, we can hear you now. We missed you for a little bit. [1:49:16] George Rowe: So that, hopefully you heard about, I was speaking about the little data center that currently exists on Cumberland Street or Cumberland Avenue. And I know there's some big electrical generator or some, you know, emergency generators attached to that. Occasionally, I think for testing purposes, they have to go on and off every so often. And it's pretty noisy. And it's, you know, but otherwise, it's a pretty quiet, you know, no one really knows what goes on in that big white building across from the teen shelter. And so, you know, I think one of the things about this resolution is it should help the city of Portland and its citizens understand, you know, where are the data centers in our town? Because, you know, data centers are basically very important for our modern infrastructure. We are having this Zoom call in the Zoom meeting because there is an enormous amount of computing capacity that now exists that didn't exist before. And if we're just, you know, using that computing capacity to live our lives, but all the benefits or the burdens of it are happening in like Pennsylvania or Virginia, wherever this, you know, Zoom call is originating from, that to me isn't fair. We should, just like we burn our own trash in our own city, that the trash that we generate, you know, we should also so make room in our own community for the data center capacity that we need to live the modern life that we all, you know, believe that we all should be and all the benefits that we take advantage of. But the problem with this is definitional, right? There's different kinds of data centers. There's data centers for Zoom calls and Amazon, you know, cloud computing and Gmail and, you know, things like small businesses need. But also there's this giant AI infrastructure that is a very different animal than your quote-unquote normal data center. And so I think that our zoning code, if we really want to go down that road to sort of put a lot of burdens, extra burdens on permitting data centers, we should be very clear what kind of data center you want to be and put some guardrails around it. So there's a lot here to unpack. I don't think a blanket ban is the way to go, but that certainly, like your moratoriums on other issues in the past, we should be thinking deeply about this because this is major infrastructure that can have a lot of deleterious effects on those close to it and on the overall communities. Do real work and not just do political theater. Thank you. [1:52:11] Pious Ali: Thank you, Mr. Rowe. Let me see, is there any other hand? Oh, it's still Mr. Rowe. Well, may I have a motion and a second? So moved. Moved by I have a [1:52:34] Lori Paulette: second. Counselor Phillips has her hand up. [1:52:37] Pious Ali: All right, Counselor Phillips. [1:52:41] Regina Phillips: Thank you, Chair. I guess I'm wondering what we're going to do with Counselor Sykes' comments that she made a little bit earlier. I mean, looking at this, I tend to agree. I mean, it does say for the United Nations Code to prohibit data centers. And so I don't know if we want to change the language. going to, I don't know what we want to do at this point in time. If we just want to leave it, great. I think Councilor Sykes, I think, I don't want to speak [1:53:08] Pious Ali: for you. Can we discuss that after the motion? Cooperation Council. Yeah, I'll just address that [1:53:16] Michael Goldman: really quick. I think there's a bit of a disconnect between the description on the agenda and then what's included in the memo and the draft resolution itself. The memo and the draft resolution both refer to the, you know, drafting regulations for data centers, not necessarily banning all of them. And so I think that reference on the agenda was not correct. It's certainly something that, But, you know, if the council wants to consider a moratorium or, you know, suggesting an outright ban in here, that's something that the council can do. It's just the way the way the resolution is currently drafted, it was intended to encourage staff and the planning board to look into some sort of regulatory framework. [1:54:21] Lori Paulette: okay counselor making a voice yeah thank you yeah i that was my interpretation too is that you know pretty much all resolutions are it could be seen as useless in that they don't they don't create any specific outcome but they do create the forum and the directive to examine it so to me that 's the conversation that planning will that we'll be having when planning has worked on things we'll be able to have the public process and give our feedback and you know figure out what we want it to look like. Okay counselor Phillips. [1:55:01] Regina Phillips: Thanks chair. I mean i'm okay because it does look like, I agree with Corporation Council, it does look like the agenda item and the resolution do say you know kind of two things. And in looking at the actual resolution, that makes a lot of sense. So I'm fine with going forward with this. So thank you. [1:55:24] Pious Ali: Corporation Council, Councilor Pelletier, I saw your hand, you dropped it, but let me ask Corporation Council, if we move this today, before it comes to the Council, can we amend it and specifically say that we are banning this or that or that type of, how do we call it? [1:55:42] Michael Goldman: Data center. Sure, I mean yeah, there's nothing, there's nothing preventing any member of the council, any member of this committee or the rest of the members of the council from, amending this before or at the meeting that you know when i'm assuming this will be on the next council meeting, so certainly subject to amendment as any other order or resolution would [1:56:06] Pious Ali: would be. Okay. Thank you very much. You hear from some of us. Councilor Pelletier. [1:56:15] Wesley Pelletier: I can comment a second, but you still need a second. So we'll hold off. [1:56:20] Pious Ali: You want to, okay. A second. May I have a second? Second. Second by Councilor Phillips. All right, Councilor Pelletier, go ahead. [1:56:31] Wesley Pelletier: Yeah i will support this so that it can be amended to do something. Yeah i would like a little stronger language than in a resolution, but if this is the starting point for that you know i look forward to seeing it thank [1:56:55] Pious Ali: you counselor for joining us and staying true thank you all i mean i 'm gonna take the vote councillor phillips yes councillor mcnews yes councillor sykes yes i am also a yes may i think that is the last item them on the agenda. May I have a motion and a second to adjourn so that I can go have dinner? [Heidi McCarthy: So moved. Second.] Moved by Councillor McNeill. Seconded by Councillor Sykes. Seconded by Councillor McNeill. Councillor Phillips. Yes. Councillor Sykes. Yes. Councillor McNeill. Yes. And I am a yes. Have a wonderful, rest of your evening. I will see you when I get back to Portland. Thank you. Good night.