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Housing commission delays tax credits

Housing commission delays tax credits

Decision comes after Boeing incentives passed

December 7th, 2013 in News

A state housing commission held off Friday on approving millions of dollars in tax credits to build apartments for low-income residents in what appears to be the first ripple effect of a separate incentive package for a Boeing airplane facility.

The Missouri Housing Development Commission's decision to delay its tax credits came shortly after the House gave final approval to legislation authorizing up to $1.7 billion in tax incentives for Boeing over two decades.

The housing aid and Boeing incentives are two distinct programs. But they were linked informally as part of the negotiations between Gov. Jay Nixon and several Republican senators who had indicated they might obstruct passage of the Boeing incentives in a special legislative session.

The senators have been pushing unsuccessfully for several years to pare back the amount of tax credits awarded to developers of low-income housing. They also want to cut back tax credits for the renovation of historic buildings. Those two programs comprised about $223 million of the $513 million in Missouri tax credits redeemed in the 2013 fiscal year, according to state data.

Lt. Gov. Peter Kinder, a member of the housing commission, was the only one to vote against the tax credit delay. He said Nixon's chief of staff spoke at Friday's meeting and asked commissioners for the delay in order to fulfill an agreement the governor made with the senators.

A Nixon spokesman declined to comment about the housing commission decision.

Sen. Rob Schaaf, who was part of the negotiations with Nixon, said he was pleased with the tax credit delay.

"It sounds to me that the governor is following through on what he said he'd do, so that's good," said Schaaf, R-St. Joseph. "Hopefully, the players in the tax credit market will start supporting getting caps on the tax credit program."

The resolution passed by the housing commission delays a vote on the tax credits until at least March 13 - about midway through the annual legislative session.

The delay affects about $14 million annually in state tax credits for 32 developments that would have 1,654 housing units.

State Treasurer Clint Zweifel, who is on the housing commission, said a staff member who attended on his behalf voted for the delay because of the request by the governor's office.

"My view is that you have to give time for the Legislature and the governor to be able to work out a compromise that allows us to compete for these jobs" with Boeing, Zweifel said. But he added: "This is not a precedent that should be set for the future."

Kinder said he saw no reason to be bound by discussions between the governor and senators and said it was "ludicrous" to suggest the Boeing incentives would not have passed the Legislature without a side deal affecting the housing tax credits.

"I think (housing) developers would tell you that any delay gums up the works," Kinder said. "They have financing commitments, they have lenders, they have institutions - large banks - that buy the credits."

Schaaf and other senators have said Nixon agreed to aggressively pursue a tax credit overhaul in the 2014 legislative session. In past years, the House has been reluctant to make cuts as deep as those the Senate sought.

House Speaker Tim Jones, R-Eureka, said Friday that he welcomes continued discussions about a tax credit overhaul and hopes Nixon will lay out specifically what he wants to see in a bill.