Building a Better Tax Credit System
This year, I filed Senate Bill 28, which aims to reform Missouri’s tax credit system for low-income housing. For many years this program has been seen by some as inefficient. As your elected representatives, I believe state lawmakers have an obligation to be good stewards of public funding. That’s why it’s imperative we create a better tax credit system — one that actually achieves its intended purpose. Tax credits come off the top of our state budget, before any other priorities are funded. I believe we should be looking for any and all ways to save the state money and be more efficient with your tax dollars, which is why I was pleased to see the Senate take up this bill to discuss an appropriate funding level for this program.
Currently, the governor is keeping Missouri’s low-income housing tax credit program on temporary hold. Before reinstituting the tax credits, he has asked the General Assembly to address the program’s inefficiencies with new legislation. That’s where my bill comes in. Under SB 28, the amount of low-income housing tax credits authorized by the state shall not exceed 72.5 percent of the amount of federal low-income housing tax credits allocated to Missouri. This would save the state approximately $40 million a year. I believe this bill fulfills the governor’s goal of creating a more responsible tax credit system.
The 72.5 percent figure came about as the result of a compromise. Various senators, with a range of different opinions on the program, came together to find a good middle ground. Although I personally would have preferred a lower cap, I believe this amount has the potential to receive broad, bipartisan support from state lawmakers. In the coming weeks, I hope to see SB 28 advance even further through the legislative process.
As always, please feel free to call, email or write with your ideas or concerns. My Capitol office number is (573) 751-1415, my email is dan.hegeman@senate.mo.gov and my mailing address is Room 332, State Capitol Building, Jefferson City, MO 65101.