BANGOR – A vacant building on the campus of the Dorothea Dix Psychiatric Center will become the site of a new 14-unit low-income veterans housing facility, making it the first state-owned building to be transformed into veterans housing in the nation, officials said.

Gov. John Baldacci signed LD 1984 into law Monday afternoon on the lawn in front of Hedin Hall at the psychiatric center on the city’s east side, a resolve that authorizes the sale or lease of the building to the Veterans Housing Coalition of Maine. The veterans group will renovate the building, making it handicapped-accessible and constructing the 14 individual units that will house senior, retired or disabled veterans and their spouses or dependents.

“This is a beneficial reuse of the building, and it’s a great way to show our respect for those who stood in harm’s way for our state and country,” Baldacci said in a brief ceremony before he signed the resolve.

The Veterans Housing Coalition of Maine was founded a couple of years ago by a number of veterans who were concerned that affordable housing was difficult to find for low-income veterans.

After looking at several sites, including the former Maine State Prison in Thomaston, it was decided the former dormitory for Bangor Mental Health Institute’s staff provided the best location for veterans housing because of its proximity to shopping centers, health care, bus routes and veterans services.

“Locationwise, this was the most ideal property in the state,” Rich Cromwell, treasurer of the Veterans Housing Coalition of Maine, said before the signing ceremony.

The coalition board members expect that $2 million in construction needs to be completed before veterans can begin using the facility, but they hope to have it open within a year or a year and a half.

The construction will be funded by using low-income housing tax credits, a Community Development Block Grant, the Maine State Housing Authority, federal home loan bank grants and private funding from organizations such as the Veterans of Foreign Wars and the Disabled American Veterans, according to Cromwell.

Sen. Joseph Perry, D-Bangor, sponsored the bill in the Legislature earlier this year.

Baldacci emphasized his pride in the state for spearheading the program.

“I think by Maine creating a model for other states, it will jump-start them, and we can show them how we did it,” Baldacci said. “This didn’t happen all of a sudden, and we can encourage other states through the process. I think it’s very fitting that Maine started this model, because we have the highest number of veterans per capita of any other state.”

The facility will undergo a name change before it is opened to veterans and their families, but the new name has yet to be determined.

The coalition now has its sights on turning a Hallowell school to use for the same purpose.

“I think it’s wonderful that we can initiate a new kind of program like this,” Jim Friedlander, president of the Veterans Housing Coalition of Maine, said Monday.