Workforce housing tax credit remains GMNP’s top legislative priority
Workforce housing continues to be the GMNP’s highest priority this session. We are supporting legislation that would create a workforce housing tax credit, managed through the Department of Employment and Economic Development (DEED), to incentivize investors and developers to build middle-income housing in Greater Minnesota communities where there is currently a shortage. Under the proposal, investors would receive a 40 percent state tax credit (up to $1 million) for contributions made toward eligible workforce rental housing. We are seeking $45 million in funding for the tax credit for the 2017-2018 biennium, which is estimated to create approximately 1,125 units. More information about the plan can be found in this informational handout.
The Senate included a version of the workforce housing tax credit legislation in its tax bill last year, and it currently remains in conference committee. Senate author Sen. Dan Sparks (DFL-Austin) and House author Rep. Rod Hamilton (R-Mountain Lake) both plan to release updated versions of the bill that will call for increased funding from what is currently in the Senate tax bill. The updated bills will seek $45M over the next biennium (the current Senate tax bill calls for $40 million over a five-year period) and some language changes that aim to make the bill more straightforward and easier to understand.
There has been some debate as to whether a workforce housing grant is preferable to a tax credit. However, we believe the tax credit is the most efficient way to start to address the problem in Greater Minnesota. It will unleash large amount of private investment dollars and direct the investment to the areas that need the assistance.
We encourage GMNP members to contact your legislators and urge them to support the workforce housing tax credit legislation. Let them know that workforce housing is important to your business and community! Go here to find out which legislators represent you.