Tax Credit Authority sets new restrictions on mixed-use development projects

On March 12, 2025, the Ohio Legislature introduced Senate Bill 145, a significant piece of legislation aimed at reshaping the landscape of transformational mixed-use development projects across the state. This bill seeks to establish a framework for tax credits that incentivize investment in urban development, but it also imposes strict limitations that could impact future projects.

The primary purpose of Senate Bill 145 is to regulate the allocation of tax credits for mixed-use developments, which combine residential, commercial, and recreational spaces. Under the proposed legislation, the tax credit authority will have the power to certify projects but will be restricted from approving any new applications after June 30, 2025. This deadline raises concerns among developers and local governments about the future of urban revitalization efforts in Ohio.

Key provisions of the bill include a cap on the total amount of tax credits that can be preliminarily approved each fiscal year, set at $100 million for 2022 through 2025. Additionally, projects located within ten miles of a major city are limited to $80 million in credits, while individual projects cannot exceed $40 million. These restrictions aim to ensure that tax credits are distributed fairly but may also hinder larger, more ambitious development initiatives.

The introduction of Senate Bill 145 has sparked notable debates among lawmakers and stakeholders. Proponents argue that the bill will streamline the tax credit process and encourage responsible development, while critics warn that the limitations could stifle growth and deter investment in urban areas. Some experts suggest that the bill may disproportionately affect smaller communities that rely on such projects for economic revitalization.

The implications of this legislation extend beyond the immediate financial aspects. By capping tax credits and imposing a deadline for new applications, Senate Bill 145 could reshape the future of urban planning in Ohio, potentially leading to a slowdown in development projects that are crucial for job creation and community enhancement.

As the bill moves through the legislative process, its fate remains uncertain. Local governments and developers are closely monitoring the discussions, as the outcomes will directly impact their ability to pursue transformative projects that could revitalize neighborhoods and stimulate economic growth. The next steps will involve further debates and potential amendments, as stakeholders advocate for a balanced approach that fosters development while ensuring fiscal responsibility.