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Reforms Championed by Treasurer Fitzpatrick Result in Improved Efficiency of Low-Income Housing Tax Credit Program

Friday, December 17, 2021
Treasurer's name

Jefferson City, MO – Missouri State Treasurer Scott Fitzpatrick today announced that because of reforms he championed with other members of the Missouri Housing Development Commission, the efficiency of the Low-Income Housing Tax Credit program (LIHTC) improved significantly when compared to last year. Because of these reforms, the value of the credits continues to increase which is resulting in more low-income housing being built with no increase in state spending.  


The average price per tax credit with standard pricing improved to $0.634 this year versus $0.58 last year, an increase of more than $0.05. For the first time in the history of the LIHTC program all projects which received an award included pricing of state tax credits of at least $0.60. Additionally, under the accelerated redemption program some credits were priced over $0.70 for the first time ever.


“Over the past three years I have worked alongside the other members of the commission to improve the efficiency and transparency of the LIHTC program and it is great to see the impact of this work,” Treasurer Fitzpatrick said. “Increasing competition for credits, like any marketplace, drives the efficiency of the program up. The accelerated redemption model I championed has no doubt led to increased competition for these tax credits and I am gratified to see the first significant price increase in years. I remain committed to protecting Missouri tax dollars and maximizing their impact.”


At yesterday’s MHDC meeting, the Commission voted to approve the Rental Production Recommendations for Funding. 


In September, the Commission unanimously expanded the availability of accelerated redemption for LIHTC to up to 50% of state LIHTC, an increase from 20% of total projects in the 2020 pilot program. This expansion followed the recommendation of a study committee, chaired by Treasurer Fitzpatrick, which evaluated the impact of accelerated redemption on pricing for LIHTC. The committee found accelerated redemption increased the value of state LIHTC over $0.10 per tax credit dollar from the 2017 standard pricing, representing an increase of 18%.


MHDC was created by the General Assembly in 1969 and administers and provides financing for the construction of affordable housing in the state. 




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