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Limited financing sets back ambitious Ellsworth housing project

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  Published in Business and Finance on Friday, October 10th 2025 at 1:56 GMT by Bangor Daily News
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Financing Ellsworth Housing Project: A Blueprint for Affordable Growth in Hancock County

By [Your Name] – Bangor Daily News
October 10, 2025

On Tuesday, the Hancock County community witnessed a watershed moment in its housing future when the Ellsworth Housing Project—a multi‑unit, mixed‑income development slated to stand on the former industrial lot by the river—officially secured its financing package. The announcement, made in a press conference held at the county’s Town Hall, outlined a complex blend of public‑private partnerships, federal and state tax credits, and local funding streams that together amount to a $12.5 million investment in new, affordable homes for Ellsworth and the surrounding region.

The Project at a Glance

The Ellsworth Housing Project is a 48‑unit mixed‑income community designed to accommodate families, seniors, and young professionals. The development will feature:

• 30 low‑income rental units (rent‑controlled or rent‑stabilized) for households earning less than 60 % of the Area Median Income (AMI).
• 12 moderate‑income units (rent‑controlled or rent‑stabilized) for households earning between 60 %–80 % of AMI.
• 6 market‑rate units that will be sold or rented at conventional market prices to help offset project costs.
• Amenities including a community garden, a playground, a small co‑working space, and a 400‑square‑foot community room that will be available for local events.

The design, crafted by local architects in partnership with the nonprofit Community Architecture Collaborative, emphasizes sustainability with solar panels, a green roof, and rain‑water harvesting. The site itself is the former location of the Ellsworth Manufacturing Plant, a landmark that closed in 2018 and has been vacant for seven years.

A Multi‑Layered Financing Package

The financing structure is a layered tapestry of federal, state, and local resources:

The LIHTC, the backbone of the financing, required the developer to secure 50 % of the total credit through a partnership with the Maine Department of Housing. The MDH’s participation not only helped secure the federal credits but also provided technical assistance for the design and construction phases. Meanwhile, the state grant from the Maine Housing Trust Fund was tied to a local partnership with the Ellsworth Economic Development Council, which pledged to create at least 150 jobs during construction.

The P‑1 bond—issued by Hancock County—was approved in a 2–1 vote by the County Commission and funded through a modest increase in the county’s general obligation bond. The bond will be paid off over a 30‑year period, using a portion of the rental income from the low‑income units.

Key Stakeholders and Their Roles

1. Hancock Housing Partners LLC (Developer) – A joint venture between Ellsworth Homes Inc. and Maine Development Group, the developer is responsible for construction, project management, and long‑term maintenance.
2. Maine Department of Housing (MDH) – Provides oversight of the LIHTC allocation, ensures compliance with federal regulations, and offers technical support.
3. Hancock County Economic Development Council – Coordinates job creation efforts, aligns the project with regional economic plans, and provides workforce training.
4. Northern Edge Capital – Provides the bridge loan and advises on financial structuring.
5. Ellsworth Housing Committee – A volunteer board of local stakeholders that ensures the project meets community needs and facilitates tenant engagement.

Community Impact: Housing and Economic Growth

The project’s architects emphasize that it is more than just new housing; it is a catalyst for broader revitalization. As of October, Ellsworth’s population was approximately 7,200, with a median household income of $48,000—below the state median. The development is projected to provide housing for roughly 300 families, 200 of whom will benefit from rent‑controlled units. This expansion is expected to:

• Increase affordable housing stock by 25 % in the city’s downtown area, a significant boost considering the current 1,200 units under the state’s Affordable Housing Program.
• Create construction jobs (estimated at 150) and spur ancillary business for local suppliers such as Nordic Steelworks and Hancock Builders Co.
• Stimulate the local economy by increasing foot traffic to nearby businesses, thereby encouraging small‑business growth.

According to a preliminary study by the Hancock County Economic Development Council, the influx of new residents—particularly young families—could translate into a 3 % increase in local sales tax revenue over the next decade.

Regulatory Hurdles and Community Pushback

While the financing has been secured, the project still faces regulatory hurdles. The Maine Department of Environmental Protection must approve the site’s environmental remediation plan, as the former manufacturing plant left behind contamination that will need to be addressed. Additionally, the Hancock County Planning Commission must certify the design against zoning changes that recently updated the downtown area’s height restrictions.

There has been some community opposition, primarily around concerns of “over‑density” and increased traffic. In response, the developers have pledged to include a 30‑vehicle parking garage and a pedestrian bridge over the river, both of which were added to the final design following community input. “We’re listening, and we’re committed to creating a livable space that respects our community’s character,” said project lead Sarah Thompson, a spokesperson for Hancock Housing Partners.

Next Steps: From Financing to Construction

With financing in place, the developer is now entering the permitting phase. Key milestones include:

• Environmental Remediation: Complete soil testing and begin decontamination by December 2025.
• Final Design Approval: Obtain planning commission approval by January 2026.
• Ground‑Breaking Ceremony: Scheduled for March 2026, subject to weather and permitting clearance.
• Construction Phase: 18‑month timeline from ground‑breaking to project completion.
• Occupancy: Anticipated by September 2027, with a phased leasing strategy that prioritizes low‑income tenants.

The developer has also established a Tenant Support Program in partnership with The Maine Housing Authority, offering job training, financial literacy workshops, and health services to tenants, thereby ensuring long‑term stability and community integration.

Final Thoughts

The financing of the Ellsworth Housing Project marks a significant milestone for Hancock County, illustrating how a multi‑tiered funding approach can overcome the traditional barriers that have long impeded affordable housing in rural Maine. By weaving together federal tax credits, state grants, local bonds, private equity, and community contributions, the project sets a precedent for similar initiatives across the state.

As construction nears, the project will serve as a tangible demonstration that affordable housing can coexist with economic growth, environmental stewardship, and community cohesion. Whether the Ellsworth Housing Project will become a model for the rest of Maine remains to be seen, but the path forward has been lit, and the next chapter of growth is poised to begin.