Impoverished communities around America would be reinvigorated under bipartisan legislation introduced on Jan. 28 by U.S. Sens. Rob Portman (R-OH) and Todd Young (R-IN).
“The Neighborhood Homes Investment Act provides a tax credit to rehabilitate blighted homes and help revitalize neighborhoods across America and Ohio,” Sen. Portman said. “As we continue to battle the ongoing COVID-19 pandemic, this tax credit will encourage opportunity and investment in neighborhoods that are often home to vulnerable populations and marked by stagnant housing markets, foreclosures and blighted or vacant homes.”
S. 98, which Sen. Portman cosponsored with bill sponsor U.S. Sen. Ben Cardin (D-MD), would establish a federal tax credit that covers the cost between building or renovating a home in such areas and the price at which they can be sold. The bill also would help existing homeowners in these neighborhoods to renovate and stay in their homes, according to a bill summary provided by Sen. Portman’s office.
The measure would specifically be targeted to neighborhoods with poverty rates that are 130 percent or greater than the metro or state rate; have incomes that are 80 percent or less than area median income; and have home values that are below the metro or state median value, according to the summary.
Among several provisions, investors would receive the tax credits only after rehabilitation is completed and the property is occupied by an eligible homeowner. The U.S. Treasury Department would be required to report annually on the program’s performance, according to the text of the bill.
“By providing a tax credit to remove and redevelop abandoned buildings, we can incentivize more affordable housing to be constructed in areas that are in need of rehabilitation,” said Sen. Young. “This legislation will benefit many struggling communities in Indiana seeking to revitalize amid this pandemic.”
The legislation has garnered support from numerous organizations, including the Center for Community Progress, Habitat for Humanity International, the Low Income Investment Fund, the Mortgage Bankers Association, the National Association of Affordable Housing Lenders, and the National Association of Realtors, among many others.
“I urge my colleagues to join me in supporting this new incentive, which will work in tandem with the New Markets Tax Credit, Opportunity Zones, and the Low-Income Housing Tax Credit to help Ohioans by providing desirable housing and generating new opportunities for their residents,” Sen. Portman said.