Keeley Crane Service lowers the second half of an accessory dwelling unit, or ADU, to its foundation in Topsham in May 2021. They are becoming increasingly popular as Maine’s existing housing crunch worsens. Ben McCanna/Portland Press Herald

Three years ago, Maine lawmakers passed a landmark bill designed to increase home construction and ease the state’s worsening housing crisis. Now, almost one year after implementation, some worry the law hasn’t lived up to its potential.

“I don’t think we’ve seen nearly that much uptake since LD 2003 passed,” said Maine House Speaker Ryan Fecteau, D-Biddeford.

Fecteau hopes to change that with a bill to patch some of the holes and confusion created with the original legislation, which makes up to two accessory dwelling units legal on all single-family lots statewide. 

Sometimes called granny flats or in-law suites, ADUs are small residences – usually 600 to 1,000 square feet – that share a single-family lot with a larger, primary dwelling. They’re often used as housing for family members or rented out for supplemental income.

“(The bill) seeks to make it more likely for a homeowner who is not independently wealthy to have the means or access to financing in order to actually build an ADU on their property,” Fecteau said during a public hearing on the bill Tuesday.

But others worry it introduces too many changes to the nascent law and could have unintended consequences.

REDUCING BARRIERS

The bill, LD 1272, would allow up to four units on a single lot and prohibit a municipality from adopting an ordinance that requires the owner of the lot to live in one of the units.

It would also allow for the accessory dwelling units to be “condo-ized,” Fecteau said, meaning the units could be purchased, rather than just rented — a move that could increase interest from developers. Homeowners could receive a portion of the sale.

The bill would also prohibit towns and cities from requiring ADUs to have sprinkler systems and expand the definition of “subdivision” from three lots to five.

The current occupancy requirement is ostensibly intended to prevent the units from becoming solely short-term rentals, Fecteau said, but removing it increases the “loan to value ratio” for the homeowner and unlocks critical access to financing, allowing more ADUs to be built.

“If both the existing home and the potential ADU can be rented, the property as a whole can be assessed at a higher value, allowing homeowners to qualify for loans they need,” he said.

Short-term rentals can be addressed in other ways, he added.

Other aspects of the bill, like subdivision and sprinkler changes, are designed to reduce what builders have complained are onerous and costly regulations and make construction more efficient and affordable.

“While LD 2003 unlocked permissions for homeowners to build ADUs, permission alone is not enough to guarantee that new housing will be built,” Fecteau said.

‘NOT A SILVER BULLET’

The bill was broadly supported by affordable housing advocates, who said reducing barriers to construction and financing will help address the state’s critical housing shortage.

Patrick Hess, director of real estate development at Avesta Housing, applauded the subdivision changes, which he said could encourage multifamily housing and development in areas that are already connected to municipal infrastructure.

“Overall, reducing unnecessary review can lower barriers to entry and streamline the municipal approvals process, thereby increasing financial feasibility for more developments and ultimately produce more housing,” he said in written testimony.

Max Rush, representing the Maine Affordable Housing Coalition, said the “modest, lower-cost homes” offer opportunities to first-time homebuyers and older people looking to downsize.

“ADUs are not a silver bullet, but they are a vital part of the solution,” he said.

Others, however, argued that some of the provisions undermine the hard-won compromises in LD 2003 and that loosening subdivision laws could have unintended consequences like sprawl and destruction of rural farmland.

Jennie Poulin Franceschi, Westbrook’s planning director, argued that the bill effectively renders the “accessory” in accessory dwelling unit meaningless.

“The point of an accessory use is that (it) is not more dominant than the primary use,” she said in written testimony.

Allowing up to four units and removing the owner-occupied requirement makes it moot while also giving ADUs flexible standards that don’t apply to other commercial-based residences.

Similarly, allowing ADUS to be purchased just creates another home — it’s no longer an “accessory” use, she said.

Ches Gundrum, director of advocacy for Maine Audubon, urged lawmakers to give LD 2003 more time to work out the kinks.

“As towns are still grappling with LD 2003 and that really important vision for our state, give them a moment to continue to work through that before we make really sweeping changes,” she said.

Developed land cannot be undeveloped, she added, so “we’ve got one shot to get this right.”