Kansas committee hears background on two housing tax credits as lawmakers weigh sunset proposal

Eric Adel, a policy analyst with the Legislative Research Department, briefed the Kansas Senate Committee on Commerce on the background, mechanics and fiscal impact of two housing tax credit programs enacted in 2022 and administered by the Kansas Housing Resources Corporation (KHRC).

The two programs are the Affordable Housing Tax Credit, which matches the federal low-income housing tax credit on a 1-to-1 basis, and the Housing Investor Tax Credit, a separate state credit for qualified investments in housing projects. Adel told the committee that the affordable housing credit was established beginning in tax year 2023 and that "the credits are non refundable which means they can be used against any outstanding Kansas tax liability that qualifies but not more than that." He said both credits are awarded through competitive application processes administered by the KHRC.

Why it matters: Committee members focused on the programs' long-term fiscal exposure and how a proposed House bill would affect projects already awarded credits. Adel and senators discussed the timing of credits, who claims them, and statutory caps and carry-forward rules that could commit state tax expenditures for years after an allocation.

Key provisions and…