In 2022, the Maine Legislature took the rare step of requiring municipalities to adjust local zoning rules to spur housing construction, sparking a fierce debate over state growth targets versus local control. Four years later, the State House may have finally worked out the kinks from that experiment.
Municipal legal experts and town managers are hoping a new bill, L.D. 2173, signed by Governor Janet Mills a week ago, will be the last word on land use restrictions for a while. This bill marks the second major adjustment to zoning laws since L.D. 2003, the landmark 2022 legislation that required towns to remove regulatory barriers to encourage housing production. L.D. 2003 aimed to eliminate single-family zoning restrictions, make it easier to build accessory dwelling units, and support affordable housing development.
However, many towns worried about how the law would work in practice and criticized its universal approach, which they saw as infringing on community planning choices. Lawmakers have since tried to find the right balance, leading to frustration and uncertainty at a time when Maine needs roughly 80,000 homes to meet demand by 2030, according to a 2024 state study. The four-year debate highlighted the power of Maine's local control ethos and its influence on housing policy.
Initial Zoning Changes and Subsequent Adjustments
L.D. 2003 changed local housing density rules to encourage more development, allowing more housing units per lot and greater density for affordable housing projects in designated growth areas. Municipalities were also required to allow accessory dwelling units on the same lot as single-family homes and could no longer adopt ordinances limiting housing to one unit per lot. However, the bill did not address minimum lot sizes, which was tackled last year with L.D. 1829, requiring minimum lot sizes to be no greater than 5,000 square feet.
L.D. 1829 also made significant tweaks to accessory dwelling unit rules, changing sprinkler requirements, prohibiting towns from requiring owner occupancy for ADUs, and expanding where those units could be built. It allowed more affordable housing units per lot, reduced parking requirements, and permitted affordable housing projects to be built one story higher than zoning typically allowed. It also changed minimum lot size limits for tracts both in and outside designated growth areas served by public or special water and sewer systems.
Pushback from Municipalities
These last two provisions quickly generated pushback from municipalities, said Representative Amanda Collamore, the ranking Republican on the Maine Legislature's housing and economic development committee. The height exemption became an issue because some towns lack firetrucks with ladders, making multi-story developments dangerous. Limiting lot sizes for areas outside serviced water and sewers raised concerns that growth would be forced where towns did not want it.
L.D. 2173, signed by Mills last week, was conceived as a fixer bill to address these concerns. It clarified what counts as a public water and sewer system, limited density requirements to areas served by those systems, exempted environmentally sensitive regions from density rules, allowed communities greater flexibility in setting lot sizes and density ceilings outside growth areas, and made affordable housing height bonuses subject to additional review.
Balancing State Interests and Local Control
House Speaker Ryan Fecteau, who sponsored L.D. 2003, acknowledged towns' frustrations and said the process needs to have some “give and take” to ensure communities buy into the goal of providing affordable homes. “I realize this is a balancing act between a state interest — to have homes people can afford – and local control, which the state has always taken great stock in,” Fecteau said.
With the dust possibly settling on zoning law changes, municipalities that have not adopted the housing density and zoning changes in L.D. 1829 now have more time under L.D. 2173, which pushed back the deadline from July 2026 to July 2027. Municipal attorney Gray Louis said many of his clients will be relieved to have extra wiggle room, hoping it will be the last time they have to adjust their zoning rules. He noted that the four years of changes exposed how difficult it can be for smaller communities to update ordinances, which usually requires hiring legal counsel.
Measuring Impact and Infrastructure Challenges
The successive changes and deadline extensions have made it difficult to measure the effects of L.D. 2003, said Jamie Garvin, director of community affairs for the Greater Portland Council of Governments. Until recently, there was no standardized way to measure housing development across the state. That changed this year with a new law requiring municipalities with populations over 4,000 to report building permits annually, with data expected later this spring.
Garvin also noted that the push for zoning adjustments ignored the reality that growth comes with expensive infrastructure costs. Scarborough, for example, has seen consistent growth for decades, but Town Manager Thomas Hall said the town does not need help encouraging housing. Instead, it needs better local transportation options, calling traffic the “number-one issue” stifling the region’s viability. “We’re at capacity, and the cost and complication of the fixes is beyond any one community’s abilities,” Hall said.
Elizabeth Frazier, a partner at Pierce Atwood representing the Maine Real Estate & Development Association, argued that the idea towns were being forced to grow is “pearl-clutching.” She said the impact of L.D. 2003 is limited because it largely empowers communities to add housing in growth zones, which they ultimately control. She suggested the state should tackle limits on subdividing parcels of property, which is currently restricted to once every five years, to truly encourage housing.
Developer Perspectives
Zoning adjustments are far from the only factor developers face. In Ellsworth, a workforce housing project on Beals Avenue has active support from the city, but developer LB Ellsworth LLC cannot quite get it over the line. Partner Dan Black said the cost of developing 36 condominiums is estimated at $425,000 per unit, but each will sell for around $279,000. Development was delayed by a vernal pool study and a neighbor's zoning waiver appeal. However, Black said he never would have approached the project without the favorable zoning, which allows 10 units per acre under Ellsworth’s neighborhood zoning ordinance.
