The Bath City Council unanimously approved a new tax increment financing (TIF) district and rezoning plan in mid-July that will allow a local affordable housing project to move on to next steps.

The approval of the TIF district will allow Bath Housing a 75% credit enhancement allowing for an additional $900,000 of debt toward the Anchorage South project. According to Bath City Manager Marc Meyers, Bath Housing will receive the 75% property tax rebate, estimated at $62,257 in the first year, for 30 years. The housing project is expected to cost around $17 million, according to Bath Housing Executive Director Debora Keller.

Bath Housing can leverage these funds for additional debt service for the project and help the nonprofit compete for Maine Housing low-income housing tax credits.

“I have staff who cannot afford to rent here, and they can’t afford to commute here either,” said Claire Berkowitz, president and CEO of Midcoast Maine Community Action, during last month’s City Council meeting.

The remaining 25% of TIF revenues will support infrastructure investments, such as intersection improvements outside the district but related to the project. The rezoning for Anchorage South allows for the mixed commercial and residential districts.

The city will retain 25% of the property taxes for the Anchorage South project, estimated at $20,752 in the first year, with these funds being used for infrastructure improvements.

In May 2024, Bath Housing announced plans to redevelop a portion of Congress Avenue with a new four-story building with 48 apartments at the northeast corner of Centre Street and Congress Avenue. According to the Bath Housing website, the Planning Board approved the Bath Housing site plan and subdivision plan on July 2, allowing Anchorage South to replace the Anchorage Apartments.

The new building will have approximately 10 more units than the existing one, which has been having issues with water in the basement.

According to Bath City Council member Miriam Johnson, about 56% of Bath is rent-burdened, which is higher than the state and Sagadahoc County averages and is one of the reasons why Johnson voted yes on the project.

The Maine Housing Facts and Affordability Index, which came out in 2020, showed that 52.8% of renters were unable to afford a two-bedroom rent in Sagadahoc County.

Bath Housing is setting aside 10 acres for conservation with the Kennebec Estuary Land Trust.

Bath resident David King spoke out against Anchorage South Affordable Housing because he felt the city was “handing away money” when the tax rate was going up. He argued the building’s design did not meet the historic building standards surrounding it.

“This project is vital for our community, and I share the opinion of some constituents and Planning Board members with this design, [which] is largely unimaginative and notably inconsistent with some basic standards of urban planning,” said Bath City Council member Louis “Roo” Dunn.

Bath’s Planning Director Jenn Curtis dismissed the opposition to the building design.

“I feel that the effort to derail the project based on design is not about the design; it’s really about derailing this whole progress and leading the project to death,” Curtis said.

Correction: An earlier version of this article misstated the name of the housing development, which is Anchorage South.

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