Kansas committee narrows, then preserves parts of Affordable Housing Tax Credit program; bill advanced

The House Committee on Commerce, Labor and Economic Development on Friday advanced House Bill 2,119, which would discontinue the Kansas Affordable Housing Tax Credit Act going forward but preserves existing awarded credits and imposes limits on newly authorized credits.

The measure initially drew a motion from Representative Clayton to replace the bill with compromise language that would cut the program in half and cap credits at about $12,500,000 a year — roughly $8,500,000 for 9% credits and a $4,000,000 cap on 4% credits. Representative Hsu seconded Clayton’s amendment, but the committee rejected it.

The committee then approved an amendment, offered by the chair, that protects deals already issued or awarded under the program. The amendment preserves $750 million in commitments for previously authorized years (described in committee as covering 2023–2025) while stopping any new allocations after those awards are fulfilled. Vice Chair Turk later moved that the bill be passed out favorably as amended; the motion carried.

Why it matters: Committee members argued over the program’s fiscal impact and its role in addressing the state’s housing shortage. Opponents told the committee the original program lacked guardrails and had grown into a large ongoing fiscal obligation, while proponents of retaining some funding stressed the program’s role in producing housing units.

Committee debate focused on fiscal trade-offs and program design. The chair told members that the program had matched federal credits in prior years and cited committee figures that the state had spent $750 million alongside $750 million in federal credits over a recent multi‑year period, producing what he called a large cumulative investment. “We can’t continue to throw good money after bad,” the chair said as he urged members to reject the larger cut. Representative Hsu warned that reducing the program could slow housing production and increase homelessness, citing testimony heard during the committee’s initial hearing.

Representative Turk and others urged a longer review of the program and noted concerns about guardrails for future allocations. Representative Clayton, who offered the failed compromise amendment, later recorded a “no” on the final passage; Representative Melton also requested her vote be recorded on an earlier item. Multiple members described a housing shortage in Kansas and questioned whether the tax credit’s structure needed a full redesign with new guardrails and a rural focus.

The bill as amended preserves existing awarded credits and stops new awards after the preserved commitments are fulfilled; committee members said the committee will continue to examine housing programs as the bill proceeds through the legislative process.

Votes and formal actions recorded in committee are summarized in the article’s actions field.