Some affordable housing projects will get tax abatements without council approval
Some affordable housing developments in Cincinnati will get an automatic tax abatement under an ordinance up passed unanimously at council Wednesday. The change allows city administration to grant tax abatements without council approval for any project awarded federal Low-Income Housing Tax Credits (LIHTC).
Previous policy was for developers to get a letter of support from city administration to include with their application to the Ohio Housing Finance Agency (OHFA). If OHFA approves the project, developers go back to the city for a local tax abatement, which requires a council vote.
Council Member Reggie Harris says he introduced the ordinance as a way to speed up the process and make local projects more likely to be chosen for the highly competitive tax credits.
"We had our partners do some research — I think we're the first city in Ohio to do this," Harris said. "So this is innovative, we'd be leading in this."
Projects awarded LIHTC have at least five units and require rents affordable to low-income households for 15-30 years. Units are typically made affordable to households earning 50% to 60% of the area median income.
According to OHFA's plan for 2022-2023 funding, Hamilton County can have no more than five awards in this cycle. Last year, seven projects in Cincinnati applied for LIHTC and four were granted with a total of 198 units.
The new policy is effective immediately and includes five development projects applying for LIHTC by the Feb. 10 deadline.
"I think this model is very important," said Council Member Jeff Cramerding. "I think it does streamline a very important process. And I think it gets council where it should be setting policy and parameters on the front end and lets the administration do its work on details."
OHFA scores applications on criteria like income diversity, housing need, resident amenities, and developer history and experience. For example, projects are awarded extra points for providing washer/dryer hookups in all units, and projects in a census tract with a high percentage of very low-income households will score higher.
Developers have to have a community outreach plan, energy efficiency or green building certification, and plans to build wireless broadband infrastructure in the development.
Other housing updates
Council also approved three motions asking administration to research and prepare a report on various housing topics:
From Council Member Greg Landsman: asking for an update on the study being conducted on the city's residential tax abatement program. An ongoing lawsuit alleges the current system discriminates against majority Black neighborhoods. Landsman's motion asks administration to "begin to prepare legislative options and any necessary procedural planning so that upon receipt of the results of the study, the pertinent governing bodies and department of the City of Cincinnati are able to get going on enacting reform."
From Mayor Aftab Pureval: asking for review of city housing incentives and zoning policies. "Topics of review should include zoning reforms to remove barriers to new, high-quality housing and to pursue policies targeting our most lucrative tax incentives to mixed-income, workforce, and affordable developments."
From Council Member Reggie Harris: asking for a report within 30 days outlining the number, neighborhood geography and Adjusted Median Income (AMI) range for new housing units that have come online in the city of Cincinnati for at least the last five years.
All three motions will get a final vote at council's regular meeting Wednesday.