Ohio Gov. Mike DeWine has signed into law a bill critics say will block affordable housing developments. The change prevents a project from receiving both Low Income Housing Tax Credits and Historic Tax Credits.
Ben Eilerman with Over-the-Rhine Community Housing says the law even seems to be retroactive, meaning some projects will have to return tax credits already awarded.
"Our Lower Price Hill project has over $900,000 in state [historic] tax credits and there's just simply not a source to fill those," Eilerman said.
Another OTRCH project could lose funding as well: about $350,000 for the Barrister project Downtown. Eilerman says it's common for affordable housing developers to seek historic tax credits when the project involves renovating an existing structure.
"It's a program that preserves buildings, but then also preserves communities by saving those buildings," Eilerman said. "And to just box out projects that also receive Low Income Housing Tax Credits — that just feels wrong to me. I don't know how else to say it."
Cincinnati Council and the Cincinnati USA Regional Chamber joined dozens of other organizations urging DeWine to veto that part of the bill. DeWine announced Friday he had signed HB 45 as-is, without any line-item vetoes.
"We will ask the General Assembly to establish a state Low Income Housing Tax Credit," DeWine said. "This is something that we have looked at, something we've been thinking about, it is something that a number of states have … I believe that it will be a game changer if the legislature does, in fact, approve that."
DeWine says it will be part of his budget proposal, coming later this month, which will include a "comprehensive approach to housing issues."
"The provision that was included in the bill that I just signed dealt with one aspect of affordable housing, but it was not a comprehensive approach to affordable housing — it was not intended, I don't think, by the authors to be that approach," DeWine said. "We believe it is time for the state to have a comprehensive policy to have a comprehensive program."
Asked why stacking LIHTC and state historic tax credits is a problem, DeWine deflected.
"I'm not the person who has brought that issue up, candidly," he said Friday. "In our process of government we have a legislature and we have a governor. And sometimes one is concerned about one thing, and sometimes another is concerned about something else. So this would — I'm not the person to be asking that question to."
The authors of this provision are unknown; it was one of a long list of amendments approved on the last night of the lame-duck session which were negotiated in private before being introduced.
Cincinnati Council Member Liz Keating, who authored the resolution urging DeWine to veto, said she's extremely disappointed.
"This hurts Cincinnati and adds more strain on our housing gap. Ohio needs housing at all levels to keep up with the demand as we continue to grow," Keating said in a statement. "I look forward to working with the Governor, Lt. Governor, and our local Statehouse delegation to address these issues in the upcoming budget."
A separate provision deals another potential blow to affordable housing projects: it allows county auditors to change the way they determine property value, which could mean a big tax increase.
Eilerman says accepting Low Income Housing Tax Credits means a property will keep rents at specific low rates. Until now, the property value would be determined based on the development's actual income. This change allows a county auditor to assess the value of the property as if those rent restrictions were not in place.
One other line-item veto requested by advocates was the deadline for $161 million for rent and utility assistance. The law says the money, which is part of the state's allocation of federal American Rescue Plan stimulus, can only be used for late payments incurred through the end of 2021.
Cincinnati Community Action Agency CEO Mark Lawson says more funding is desperately needed, but none of the families on the waitlist have bills that old. And the rule might even apply to the most recent $7 million the agency was awarded for rent assistance.
"We have to wait to hear back from the State Department of Development to see how they're going to interpret this bill and whether it does affect current money," Lawson said.
Until then, everything is on hold — meaning no applications for rent assistance are moving ahead.
"I've heard that efforts are underway to get a bill passed to make corrections, but I have no idea when," Lawson said.
DeWine signed the bill without changing that deadline. He did not address this issue during Friday's press conference.
