SPRINGFIELD — Lawmakers are considering bills that would create a new tax credit for affordable housing, referred to as the Build Illinois Homes Tax Credit.
The legislation, contained in the identical House Bill 2044 and Senate Bill 1737, would mirror a federal program — administered by the Illinois Housing Development Authority and Chicago Department of Housing — that helps finance affordable housing across Illinois.
The Illinois Housing Council, a nonprofit membership association comprising more than 260 businesses and nonprofits, has been advocating for the measure’s passage.
“Our state is facing an affordable housing crisis, stemming from years of housing underproduction,” Allison Clements, executive director of IHC, testified to a Senate committee. “Our state’s housing deficit has grown 64% since 2012, meaning we have more people needing homes than are available.”
A 2023 IHC report shows Illinois still has a deficit of low-income housing despite the federal program. According to the report, Illinois has lost 13% of its low-rent units since 2011. Additionally, while there are more than 450,000 extremely low-income renters in Illinois, there are only about 150,000 affordable and available rental units, creating a deficit of about 288,000.
“The dollars have actually filled a critical need, but they are only a short-term solution to build affordable housing in Illinois,” Rep. Dagmara Avelar, a Bolingbrook Democrat and lead sponsor on HB 2044, said in a House committee hearing Thursday. “The long-term, permanent solution is a state tax credit, the Build Illinois Homes Tax Credit, that can sustain affordable housing construction over the next 10 years.”
If passed, the Build Illinois credit would cost the state $35 million annually for 10 years, which advocates say would help increase the number of housing units by 3,500 each year. Once investors construct the housing developments, they would be eligible for an income tax credit based on the development area.
Clements emphasized that the state tax credit would only be issued after the construction of a unit is complete and qualified tenants move in.
“Private sector investors, not taxpayers, are going to bear the financial risk of a project not being completed or successful, and they closely monitor and oversee each development where these credits are involved,” Clements said to the House committee. “Because the state tax credit is not claimed by an investor until the affordable housing is successfully built and completed, passing this state tax credit this year would not result in any budget impacts to the state until 2026.”
According to the IHC report, more than 20 states currently use tax credits to attract private equity for building more affordable housing. Lawmakers in Kentucky and Ohio also are considering measures to enact such programs.
Gov. JB Pritzker proposed additional funds for housing in his budget address. The program, referred to as Home Illinois, would provide a $50 million increase in homelessness services, including for emergency shelter, short-term rental assistance and the development of new permanent supportive housing units. If implemented, Home Illinois would bring the total funding in that area to $350 million.
In his budget address on Feb. 15, the governor estimated more than 120,000 people experience homelessness annually and more than 76,000 children live in overcrowded, shared housing.
“The faces of Illinoisans with no home to go to are not homogenous,” Pritzker said in his budget address. “They include single parents with infants and toddlers, sixth-graders trying to complete their homework using toilets as a desk in temporary shared housing, and LGBTQ+ high schoolers who were kicked out of their homes by their parents.”
• Capitol News Illinois is a nonprofit, nonpartisan news service covering state government. It is distributed to more than 400 newspapers statewide, as well as hundreds of radio and TV stations. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.
Ino Saves New
via rk2’s favorite articles on Inoreader https://ift.tt/MqPbk40
March 27, 2023 at 06:52AM