Cincinnati Council urges DeWine to veto law they say jeopardizes affordable housing projects
Cincinnati City Council is urging Gov. Mike DeWine to veto a state law change they say will prevent affordable housing developments. Without a veto, at least two local projects will lose funding.
The changes are part of a lengthy set of amendments to House Bill 45, which passed overnight on the last night of the lame-duck session. The changes prevent a housing project from receiving both Low Income Housing Tax Credits and Historic Tax Credits.
"What is most concerning to me is that there's also language in it that appears to instruct the director of the State Historic Tax Credit program to pull back credits that have already been awarded to projects," said Ben Eilerman, senior developer with Over-the-Rhine Community Housing.
That would affect two OTRCH projects: a $960,000 loss for the Lower Price Hill Thrives project, and another $350,000 loss for the Barrister project in downtown Cincinnati. Eilerman says the project in Lower Price Hill is especially in danger because it's so close to completion, without much time to secure other funding.
'It makes Ohio a hostile business environment'
Council Member Liz Keating authored a resolution passed in Council Wednesday. She says she's also reached out directly to the governor and lieutenant governor's offices.
"If the state goes back and claws back those tax credits that were always already promised on these projects that are already under construction, it's an unfair business practice and it makes Ohio, and particularly our region, a hostile business environment," Keating said. "I think it's going to have a long lasting negative impact on developers and lenders who want to come in and do projects here and invest in the region in the future."
Eilerman says developers often combine LIHTC and Historic Tax Credits to turn vacant buildings into housing.
"I think that the result [of this change] is we're going to see these buildings and these neighborhoods continue to see vacancy and to see disrepair," he said.
The Coalition on Homelessness and Housing in Ohio also is decrying the changes, which also includes allowing county auditors to change the way they determine property value of affordable housing properties, which could mean a big tax increase.
"Courts have long recognized that housing properties with rent restrictions should be assessed based on their actual income because these properties operate under state and federal rent restrictions that limit the amount of rental revenue they can generate," the organization said in a statement. "Nonetheless, the HB 45 amendment would allow these properties to be taxed at an inflated market value based on the hypothetical removal of these restrictions."
Executive Director Amy Riegel says this change resembles one in the biennial budget that was removed after pushback from hundreds of organizations. Riegel says it also contradicts a recent compromise between the Ohio Housing Council and the County Auditors Association of Ohio.
Cincinnati USA Regional Chamber President Jill Meyer also sent DeWine a letter urging him to veto the provisions.
DeWine has to sign or veto bills within 10 days of receiving them, not including Sundays or holidays.