South Portland’s Housing Dilemma: Why the Mahoney Center Wins Over Homes

South Portland’s city council has charted a 2025 plan to transform the old Mahoney Middle School into a community hub while also pushing for more affordable homes for middle‑income families. The 2026 agenda reiterated the housing push and added a bond vote for city buildings slated for November.

The Mahoney Center Takes the Spotlight

• 2025 Decision: Fifty‑six new market‑rate apartments approved; no affordable units added.
• No Mandatory Inclusion: Unlike many cities, South Portland lacks a requirement for developers to embed low‑cost homes in projects.
• Potential Incentives: The city could have used incentives to encourage affordable housing but did not.

Deal with Ocean’s 170 LLC

• Tax Credit: Thirty‑year credit worth $11 million.
• Building Height: Allowed six stories instead of five.
• Parking Flexibility: Reduced parking requirements, saving tens of thousands per spot.
• Outcome: All 208 studio and one‑bedroom units near the center remain market rate.

Allocation of Time and Funds

• Mahoney Center Priority: A multi‑million dollar project that eclipsed workforce housing goals.
• Historic Preservation Plan: Offered by the South Portland Housing Authority, but rejected after $200k spent on a facilities study (including $30k from COVID ARPA funds).
• Council’s Decision: Approved $4.5 million (half from ARPA) for a new plan; the housing authority’s proposal to partner and avoid a $70 million bond was denied.

The Affordable Housing Committee

• Formation: “Mahoney Reimagined” committee created; early planning funded by public money.
• Funding Dispute: The affordable housing committee wanted to redirect funds into the city’s trust fund; manager and council rejected.
• Future: The committee may be dissolved due to lack of funding. One councilor noted a $194 million bond would overburden taxpayers already strained by deferred maintenance and costly replacements.

Bottom Line

South Portland’s leadership has concentrated on a single, high‑profile project at the expense of broader affordable housing needs. Residents remain with limited options, and future voters face a heavier financial burden.