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April 29, 2024

House passes bill modifying housing tax credit eligibility

Contributed A sketch of the proposed apartments at Bel Air Circle, Rocky Hill
By Skyler Frazer

The state House of Representatives has passed a bill that modifies eligibility requirements for an apartment tax credit program by increasing the percentage of units that must be designated as “workforce” housing. 

What’s in the bill:

House Bill 5153, which was introduced by the Housing Committee, makes changes to a tax credit program created last year for “workforce housing development projects” through the Connecticut Housing Finance Authority (CHFA) and state Department of Housing (DOH).

The bill modifies the specifications of new projects eligible through CHFA’s Housing Tax Credit Contribution program, which provides tax credit vouchers for businesses that make cash contributions to nonprofits that develop, sponsor or manage affordable housing developments. The tax credits can apply against various business taxes.

Specifically, the bill increases the percentage of units that must be rented to the workforce population, such as teachers, police officers, firefighters or other eligible groups, from 40% to 50%. It also decreases the share of units that must be rented at market rate from 50% to 40%.

The remaining 10% of units must be reserved for affordable housing. That remains unchanged.

Who’s for it:

The Connecticut Business & Industry Association supported the bill, saying it would help the new tax credits established in last year’s law “operate effectively.”

“Our state is in a workforce shortage with over 90,000 jobs currently open. To help fill those jobs we need to ensure that there are affordable housing options available to our workforce,” said CBIA lobbyist Peter Myers. “This program will help to create more affordable housing options for our workforce.”
    
Who’s against it:

No one testified in opposition to the bill when it was in committee, but advocacy group Connecticut Voices for Children asked for the percentage of units reserved for affordable housing to be increased from 10%.

What’s next:

The state House of Representatives passed the bill in a 147-0 vote on April 25, so the proposal now goes to the Senate for consideration. If it passes both chambers, the bill will go to Gov. Ned Lamont, who can sign it into law, veto it or do nothing.
 

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