An Act To Provide Accountability in the Handling of Affordable Housing Tenants' Security Deposits
Maine Legislature, Session 126, LD 1072
Committee: Labor, Commerce, Research and Economic Development
Sponsors: CHIPMAN, CAMPBELL, GILBERT, HAMANN, MASON, NADEAU, VOLK, WINCHENBACH, PATRICK
Amends: 30-A MRSA §4722

Legislative Document 
No. 1072 
H.P. 765 
House of Representatives, March 19, 2013 
An Act To Provide Accountability in the Handling of Affordable 
Housing Tenants' Security Deposits 
Reference to the Committee on Labor, Commerce, Research and Economic Development 
suggested and ordered printed. 
MILLICENT M. MacFARLAND 
Clerk 
Presented by Representative CHIPMAN of Portland. 
Cosponsored by Representatives: CAMPBELL of Newfield, GILBERT of Jay, HAMANN of 
South Portland, MASON of Topsham, NADEAU of Winslow, VOLK of Scarborough, 
WINCHENBACH of Waldoboro, Senator: PATRICK of Oxford. 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1.  30-A MRSA §4722, sub-§1, ¶CC, as corrected by RR 2009, c. 2, §85, is 
amended to read: 
CC.  Encourage and provide incentives to individuals and entities that conserve 
energy; support and participate, with resources derived from sources except the 
conservation program fund under Title 35-A, section 10110, subsection 7, in markets 
that reward energy conservation and use the proceeds from this participation to 
support affordable housing programs under its jurisdiction; and create and administer 
programs that encourage individuals and entities to conserve energy; and 
Sec. 2.  30-A MRSA §4722, sub-§1, ¶DD, as amended by PL 2011, c. 453, §2, is 
further amended to read: 
DD.  Certify affordable housing projects for the purpose of the income tax credit 
increase under Title 36, section 5219-BB, subsection 3; administer and enforce the 
affordability requirements set forth in this paragraph; and perform other functions 
described in this paragraph and necessary to the powers and duties described in this 
paragraph. 
(1)  For purposes of this paragraph, unless the context otherwise indicates, the 
following terms have the following meanings. 
(a)  "Affordable housing" means a decent, safe and sanitary dwelling, 
apartment or other living accommodation for a household whose income 
does not exceed 60% of the median income for the area as defined by the 
United States Department of Housing and Urban Development under the 
United States Housing Act of 1937, Public Law 412, 50 Stat. 888, Section 8, 
as amended. 
(b)  "Affordable housing project" means a project in which: 
(i)  At least 50% of the aggregate square feet of the completed project is 
housing of which at least 50% of the aggregate square feet of the 
completed housing creates new affordable housing; or  
(ii)  At least 33% of the aggregate square feet of the completed project 
creates new affordable housing. 
(2)  An affordable housing project for which the owner of the property received 
the income tax credit increase under Title 36, section 5219-BB, subsection 3 must 
remain an affordable housing project for 30 years from the date the affordable 
housing project is placed in service.  If the property does not remain an 
affordable housing project for 30 years from the date the affordable housing 
project is placed in service, the owner of the property shall pay to the Maine State 
Housing Authority for application to the Housing Opportunities for Maine Fund 
established under section 4853 an amount equal to the income tax credit increase 
allowed under Title 36, section 5219-BB, subsection 3, plus interest on that 
amount at the rate of 7% per annum from the date the property is placed in 
service until the date of payment of all amounts due.  The affordability 
requirements and the repayment obligation in this subparagraph must be set forth 
in a restrictive covenant executed by the owner of the property and the affordable 
housing project for the benefit of and enforceable by the Maine State Housing 
Authority and recorded in the appropriate registry of deeds before the owner of 
the property claims the income tax credit increase under Title 36, section 
5219-BB, subsection 3. 
(3)  If the repayment obligation in subparagraph (2) is not fully satisfied after 
written notice is sent by certified mail or registered mail to the owner of the 
property at the owner's last known address, the Maine State Housing Authority 
may file a notice of lien in the registry of deeds of the county in which the real 
property subject to the lien is located.  The notice of lien must specify the amount 
and interest due, the name and last known address of the owner, a description of 
the property subject to the lien and the Maine State Housing Authority's address 
and the name and address of its attorney, if any.  The Maine State Housing 
Authority shall send a copy of the notice of lien filed in the registry by certified 
mail or registered mail to the owner of the property at the owner's last known 
address and to any person who has a security interest, mortgage, lien, 
encumbrance or other interest in the property that is properly recorded in the 
registry of deeds in which the property is located.  The lien arises and becomes 
perfected at the time the notice is filed in the appropriate registry of deeds in 
accordance with this subparagraph.  The lien constitutes a lien on all property 
with respect to which the owner receives the income tax credit increase under 
Title 36, section 5219-BB, subsection 3 and the proceeds of any disposition of 
the property that occurs after notice to the owner of the repayment obligation.  
The lien is prior to any mortgage and security interest, lien, restrictive covenant 
or other encumbrance recorded, filed or otherwise perfected after the notice of 
lien is filed in the appropriate registry of deeds.  The lien may be enforced by a 
turnover or sale order in accordance with Title 14, section 3131 or any other 
manner in which a judgment lien may be enforced under the law.  The lien must 
be in the amount of the income tax credit increase allowed under Title 36, section 
5219-BB, subsection 3, plus interest on that amount at the rate of 7% per annum 
from the date the property is placed in service until the date of payment of all 
amounts due.  Upon receipt of payment of all amounts due under the lien, the 
Maine State Housing Authority shall execute a discharge lien for filing in the 
registry or offices in which the notice of lien was filed. 
(4)  Annually by every August 1st until and including August 1, 2023, the Maine 
State Housing Authority shall review the report issued pursuant to Title 27, 
section 511, subsection 5, paragraph A to determine the percentage of the total 
aggregate square feet of completed projects that constitutes new affordable 
housing, rehabilitated and developed using: 
(a)  Either of the income tax credits under Title 36, section 5219-BB, 
subsection 2; and  
(b)  The income tax credit increase under Title 36, section 5219-BB, 
subsection 3. 
If the total aggregate square feet of new affordable housing does not equal or 
exceed 30% of the total aggregate square feet of rehabilitated and developed 
completed projects eligible for a credit under Title 36, section 5219-BB, the 
Maine State Housing Authority and Maine Historic Preservation Commission 
shall notify the State Tax Assessor of this fact.; and 
Sec. 3.  30-A MRSA §4722, sub-§1, ¶EE is enacted to read: 
EE.  Establish a process for verifying the proper return or retention of security 
deposits paid by low-income tenants who have received financial assistance for rental 
expenses under this chapter and by low-income tenants who qualify for admission 
into housing projects under section 4743, subsection 1.  The process must be used by 
the authority and by municipal housing authorities and must provide a system by 
which the authority verifies and documents the condition of the dwelling unit at the 
beginning of the rental term and upon termination of the tenancy and makes that 
information available to both the tenant and the landlord. 
SUMMARY 
This bill requires the Maine State Housing Authority to establish a process for the 
authority and municipal housing authorities to use to verify the condition of dwelling 
units rented to low-income tenants in order to provide documentation for the proper 
retention or return of security deposits.