Committee debates House offer to cap low‑income housing tax credits amid concerns about program scope and impact

Senate Commerce members discussed a House offer to limit the state’s low‑income housing tax credit allocation for the current year to $20 million, a figure one committee member said would equate to $200 million over a 10‑year period. The proposal is part of a counteroffer intended to shrink a widely used tax credit program and redirect some funding to moderate‑income homeownership programs.

A member of the committee who presented the House offer said the state has spent “to the tune of at least $750,000,000 on that one program” over the past three years. The member proposed capping the current year’s allocation at $20,000,000 and then phasing the program back to a $25,000,000 annual limit in fiscal years 2030 and 2031 through staged allocations (two proposals were offered: $2.5 million per year for 10 years, or $5 million per year for five years). The offer also included funding reallocations to support moderate‑income housing ($3.4 million per year) and a Kansas homeownership income tax credit ($1.6 million per year), for a combined $5 million in redirected annual funding; all funding would remain subject to appropriations, the presenter said.

Committee members expressed divergent views. One member urged caution, saying the federal low‑income housing tax credit was not designed to promote homeownership and noting the program’s primary purpose is to create affordable rental units. That member said there are roughly 6,600 units in the pipeline and that some of those units could rent for as little as $500 per month. Another member framed the issue as a workforce‑housing concern, saying workforce availability depends on housing supply, and opposed the House offer.

The committee did not adopt a final position; members agreed to take more time to consider the House proposal and reconvene after the floor session. A committee member also asked whether leadership had changed its instruction to hold on SB 51 and SB 52; the response indicated SB 51 was planned to run across the floor and be negotiated there, while SB 52’s prospects were uncertain.

The transcript records debate over program design and the potential consequences of imposing steep caps. One member warned that eliminating or sharply reducing the tax credit for multiple years could “bring this to a screeching halt,” and another said the House’s original position had been to eliminate the program entirely.

No formal vote on the House offer was recorded in the committee transcript; members agreed to reconvene after the next floor session to seek further direction and possible agreement.