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Committee hears testimony on SB 173 to simplify tax assessment of LIHTC properties
Summary
Senate Bill 173 would simplify how low-income housing tax credit (LIHTC) properties are assessed for property tax purposes, replacing a complex formula with a straightforward 10% of actual income approach; assessors, developers and housing groups testified in support.
Senate Bill 173 seeks to standardize property tax treatment for multifamily properties subject to long-term affordability covenants financed with federal Low-Income Housing Tax Credits (LIHTC).
Senator Murphy introduced SB 173 as a clarification to RSA 75:1-a intended to address differing municipal interpretations of the current statute. Supporters including developers, municipal assessors and housing advocates told the committee the existing alternative formula is administratively burdensome and sometimes subjective.
Matt Manning of Elm Grove Companies said owners currently undergo multi-page audits and complex inputs (cap rates, vacancy assumptions, equalization ratios) that are error-prone; he said the bill's approach of taxing 10% of actual property income would simplify administration and improve predictability for operators. Scott Bartlett, the assessor from Goffstown and member of the Assessing Standards Board subcommittee, testified that the Assessing Standards Board prefers SB 173's language and supported substituting the formula with the actual-income approach; he urged a minor drafting fix in the bill analysis ("assessed" vs. "taxed").
Representatives from NeighborWorks Southern New Hampshire and New Hampshire Housing described the operational realities of LIHTC properties: long-term affordability covenants, operating budgets that cannot raise rents to meet cost increases and frequent asset-management reviews. Jack Reuterman of New Hampshire Housing said the bill would provide predictability for owners of the roughly 400 LIHTC-financed developments the agency oversees. Betsy Patton, chair of the Assessing Standards Board, said the board voted to support SB 173.
Witnesses emphasized the difference between the two options currently allowed by statute and urged keeping the statutory language to "actual income", not "net income," because the latter could produce significant tax changes and unpredictability.
No formal committee vote on SB 173 was recorded in the excerpt provided.
