House amends CHIP in S.127, adding cap and new affordability rules; committee flags limits on eligible infrastructure

The House passed S.127 on third reading May 27 and replaced the Community Housing Infrastructure Program, or CHIP, provisions with a floor amendment that would broaden what counts as housing development while narrowing which infrastructure projects can use the program's tax-exempt financing.

The committee on Economic Development, Housing & General Affairs met May 27 to review the amendment and discuss options for a committee-level response. "The house has just passed on third reading, S-one 27, which includes, quite a few changes to, the CHIP proposal that we sent them," the committee chair said. John Gray of the Office of Legislative Counsel reviewed the amendment and its key changes for the committee.

Why it matters: the amendment changes who can use CHIP and what they can build with it. Committee members flagged potential impacts on municipal flexibility, the amount of property tax increment that will be retained statewide, and administrative burdens for small projects.

Key changes described to the committee

- Definition of housing development: The amendment expands "housing development" to explicitly include renovation and rehabilitation, not only new construction. "They've added rehabilitation and renovation so that if you are taking a building and turning it into, a habitable, place that previously wasn't a habitable…