Conferees trade offers on low-income housing, data-center and film tax credits; disagreement over cap and sunset

Conferees negotiating Bill 2289 discussed a Senate offer to replace the bills current text with House Bill 2119s low-income housing tax credit language, add the contents of SB51 (qualified data centers) and SB52 (film tax credit), and apply a sunset, but did not reach agreement.

A Senate conferee, identified in the meeting transcript as Senator Owens, described the Senates proposal and the fiscal estimate behind part of it. "The amendment that passed, in senate commerce eliminated the 4% program and kept the 9% program of LIHTC," Senator Owens said. "It is estimated based on what has historically been used in that, 9% program that that is about 8,800,000 so that's where that 8.8 comes from is the historical context of, the 9% credit and eliminating that 4% credit." The senator presented the offer as removing the contents of Bill 2289 and inserting HB2119, and adding a five-year sunset.

A House conferee countered with concerns about fiscal exposure and the Kentucky Housing authority-like entity referenced in the transcript. The House conferee said "they're kind of fast and loose with money," and urged placing a hard cap on awards. He proposed language to limit awards "up to 8,800,000.0 in awards each year" and suggested shortening the sunset to three years. That conferee also asked that a technical fix included in House Bill 2096, regarding the transferability of a rural housing investor tax credit in its first year, be inserted into Bill 2289.

Participants discussed the origin of the $8.8 million figure. Research staff stated that Senator Owens explanation was "consistent with my understanding," and the committee noted that the $8.8 million figure reflects historical use of the 9 percent low-income housing tax credit program after removing the 4 percent credit.

Committee members did not resolve SB51 or SB52. One conferee said his leadership authorized negotiation on SB51 but not on SB52, and that proposed amendments to SB51 were still under review. The Senate presenter said the offer included SB51 and SB52 "as passed by the Senate," while the House conferee declined to accept SB52 at this time.

The committee recessed twice for short intervals to allow members to consult leadership and to await floor action on budget business. Members agreed to reconvene later after budget work to continue negotiations; no formal vote on the bill text or on inclusion of any offered provisions occurred during the recorded discussion.

Next steps identified in the meeting: conferees will prepare a written counterproposal delineating each requested change and any amendments for SB51; leadership will review outstanding amendments; and the committee will reconvene after the budget floor work to resume talks.